How would supply/demand be worked out?

[Bitter Ashes]

Hiya. Me again :)
I've got another question. Forgive me if it seems a bit dumb, but the answer really isnt leaping out at me just yet. :blushing:
So, if all production is in the hands of the workers, how do we know what to make? Currently it's based on market prices, when something's in high demand and the price is high, the "bougelous" (is that right?) deciede to start producing more of that so they can get the most profit. When the market price is low, they cut back and sell up.
Obviously, what we're aiming for is for there to be no bougelous people and no market economy, right? So, what method would be used in order to stop us fumbling in the dark and ending up with a tonne of stuff we dont need and hardly any of the stuff that we do? Would there be some kind of agency involved monitoring what's required? And if we needed more of something, then how would we go about producing more and when we have too much of something, how do we reduce the production without workers suffering?
Actualy, that seems like quite a lot more than just one question doesnt it? :blushing:
Anyway, thanks for any help with helping me understanding this.
-Rachel

[thinkerOFthoughts]

Most likely via requests. I would assume that some sort of job could be created to help sort out what is really wanted by the community at large.

[Bitter Ashes]

That's intresting. Who would the requests be directed to?

[Bitter Ashes]

oh and how would those requests be dealt with? I mean, would it be like every household submitting a shopping list every week or something and then going to go collect it?

[thinkerOFthoughts]

I dont really know:lol: I'm not AS new as you are but I am still fairly new:) I think this could all be handled the same way its being handled now, only no money is involved...... but I dont know much about how this would be handled.

[Nils T.]

Currently it's based on market prices, when something's in high demand and the price is high, the "bougelous" (is that right?) deciede to start producing more of that so they can get the most profit. When the market price is low, they cut back and sell up.Do you mean "bourgeois" ?
Anyway, the current system is more complex than that. The market is not preexisting, before the commercial activity.
A large part of the activity of commercial companies is dedicated to the manipulation of the market : there's all the marketing and advertising activity, of course, but also manipulations centered on the distribution and on the communication of information about the demand and the offers.
The decision to increase the production is not always the best one in order to increase the profits. You can take for example the oil companies, that limits the production, and notably the capacity of the oil refineries in the consumer countries, to increase their profits during the fluctuations of the prices. There's also the example of most housing markets in europe and north america during the last years, where a large number of buildings were retired from the market to increase the prices.
There is also the planned obsolescence of the products, such as cars or domestic appliances and electronics. An oven built in the seventies could last twenty or thirty years, now they are built to last five to ten years.

The market in a primitive communist society or in a progressive socialist society will still function as it does now, just without requiring profit : the distribution industry (from the supermarkets to online shops) will be maintained, offering diverse products and requesting the producters for more if they are lacking from the shelves.
I think that this system will be completed by the development of the communication and of its means between the producers, the distribution and the consumers. Now, the communication with the consumers is mostly one-sided, and that should change. "New" technologies and their new uses will help this change, as well as the increased mobility of the individuals in differents positions of the social relations (a society where people are obeying a strict worker role from nine to five and a strict consumer role during the rest of their lives is not a communist one). The least creative parts of the innovation activity from most producers will probably suffer from the evolution, reducing the number of "new" products , but I don't believe that any diversity in the offers will disappear.
One governemental agency would be a far too rigid structure to organize the contact between the different stage of the commercial activity, but a number of organizations coordinated ("trade unions...") could do the job.

Overproduction will be a marginal problem, in the early times because work will not be coerced and because we are lazy. Unemployment will not have the same meaning, and will not be punished.

[Bitter Ashes]

The market in a primitive communist society or in a progressive socialist society will still function as it does now, just without requiring profit : the industry of distribution (from the supermarkets to online shops) will be maintained, offering diverse products and requesting the producters for more if they are lacking from the shelves.EPOS! lol. I feel so stupid now! :blushing:
I used to be a shop worker and I was eventualy doing parts of the manager's job (not getting paid for it mind you!) and one of those was the orders. I fully see what you're saying now :)
If anything, it's simpler! We knew exactly what people are buying and where thier buying trends are going from the little PC in the back office. No fuss with the markets. It'd actualy make it a lot less of guesswork and if we're not having to guess as much about what people will be wanting in the future. There's always going to be a slight element of unpredictibility though, but nowhere near as much. That means less wastage. Now, that would make up for a drop in production.
I'm still not entirely sure how, for example, a new production line would be opened up though. I'm guessing that when it's looking like more products need to produce an order would go out. Would it really be as simple as just asking the unions for construction workers to build a new factory and engineers to supply it with machinary for the factory workers?, getting them trained on any new machines and letting it go wherever it may from there?
It's wierd. The more I think on this, the more it all just seems so shockingly simple and I'm just wondering where the imperfections, you get with anything, must be and also why in such a good system, why things have ever gone wrong in the other countries that have tried this. Very strange feeling in my head right now and I'm not such what it is.

edit:
Yes, I think "bourgeois" was the word I was looking for. I wasnt sure if it was the correct word to use or not. I guess I should just double check it in the dictionary again :):)

[JimmyJazz]

Hiya. Me again :)
I've got another question. Forgive me if it seems a bit dumb, but the answer really isnt leaping out at me just yet. :blushing:
So, if all production is in the hands of the workers, how do we know what to make? Currently it's based on market prices, when something's in high demand and the price is high, the "bougelous" (is that right?) deciede to start producing more of that so they can get the most profit. When the market price is low, they cut back and sell up.
Obviously, what we're aiming for is for there to be no bougelous people and no market economy, right? So, what method would be used in order to stop us fumbling in the dark and ending up with a tonne of stuff we dont need and hardly any of the stuff that we do? Would there be some kind of agency involved monitoring what's required? And if we needed more of something, then how would we go about producing more and when we have too much of something, how do we reduce the production without workers suffering?
Actualy, that seems like quite a lot more than just one question doesnt it? :blushing:
Anyway, thanks for any help with helping me understanding this.
-Rachel

Market socialism (not to be confused with a mixed economy; all production is still planned, and the MoP are collectively owned, under market socialism):
Lange Model (http://en.wikipedia.org/wiki/Lange_Model)

Other models laid out in free online books:
Link (http://books.zcommunications.org/books/polpar.htm)
Link (http://ricardo.ecn.wfu.edu/%7Ecottrell/socialism_book/)

[Nils T.]

why things have ever gone wrong in the other countries that have tried this.Most countries that claimed to be socialist were imposing a heavy state control on economic activity, and a bureaucracy was in charge of selecting what was needed and who will provide it and under which conditions. That system is very limited.
The process needs to get everyone to participate in all its stages, using a system of direct democracy at first. (I share with some others the will to continue the revolution on a daily basis and in the doing eradicate democracy as the last avatar of authority, but most here seems to accept direct democracy as an ultimate stage).

__________________

"Ici, on spontane."

[revolution inaction]

It's wierd. The more I think on this, the more it all just seems so shockingly simple and I'm just wondering where the imperfections, you get with anything, must be and also why in such a good system, why things have ever gone wrong in the other countries that have tried this.


No country has ever tried this, all the so called "communist" countries actually operated/operate a kind of capitalism, called state capitalism, where the state acted as one giant capitalist business. Workers were still paid wages and goods were sold. But the prices and production quotas were set by a central bureaucracy rather than market mechanisms, this tended to make it less efficient then market capitalism because it didn't really deal with feedback about things produced vary well.

[revolution inaction]

Most countries that claimed to be socialist were imposing a heavy state control on economic activity, and a bureaucracy was in charge of selecting what was needed and who will provide it and under which conditions. That system is very limited.
The process needs to get everyone to participate in all its stages, using a system of direct democracy at first. (I share with some others the will to continue the revolution on a daily basis and in the doing eradicate democracy as the last avatar of authority, but most here seems to accept direct democracy as an ultimate stage).

__________________

"Ici, on spontane."

What do you mean be democracy?

[SocialismOrBarbarism]

Hiya. Me again :)
I've got another question. Forgive me if it seems a bit dumb, but the answer really isnt leaping out at me just yet. :blushing:
So, if all production is in the hands of the workers, how do we know what to make? Currently it's based on market prices, when something's in high demand and the price is high, the "bougelous" (is that right?) deciede to start producing more of that so they can get the most profit. When the market price is low, they cut back and sell up.
Obviously, what we're aiming for is for there to be no bougelous people and no market economy, right? So, what method would be used in order to stop us fumbling in the dark and ending up with a tonne of stuff we dont need and hardly any of the stuff that we do? Would there be some kind of agency involved monitoring what's required? And if we needed more of something, then how would we go about producing more and when we have too much of something, how do we reduce the production without workers suffering?
Actualy, that seems like quite a lot more than just one question doesnt it? :blushing:
Anyway, thanks for any help with helping me understanding this.
-Rachel

I found this post searching through the forums once, it offers a simple solution concerning shortages and surpluses:


We originally emphasized the market clearing price mechanism. I still think it should be the fallback mechanism, but would now say that the first order mechanism should probably be a simple stock in hand adjustment process. The output of a good should be adjusted to keep a certain number of days stock at current sales levels in the warehouses. Suppose the target stock is 20 days sales. One would try to adjust output to keep this constant in the face of varying sales. Only if stocks fell below some lower limit - say 8 days stocks, would prices be raised.

I came to this conclusion in the mid 90s after attempting to do some simulations of a multi-industrial sector model with the simple market clearing price system and found
that it was difficult to keep the model stable. One saw wild fluctuations of prices which
led to the whole economy eventually collapsing. The aim of the simulation was
not to study socialist economies, but to study the law of value in capitalist economies,
but the conclusion I came to was that even in a capitalist economy price adjustment
probably plays a lower role in economic regulation than economic theorists suggest.
Instead I think that the 'quantity channel' which focuses on the flow of quantative orders
between regular customers and regular suppliers is probably more important. I
think that the whole Hayekian school have over estimated a the role of the price
as opposed to the quantity channel in economic regulation. This was one reason
why their attempt at shock therapy in the ex ussr was such a no no.

If more of something needs to be produced to maintain the target stock, then more resource would be diverted to that product. If less needs to be produced, then the opposite will happen.

[Nils T.]

What do you mean be democracy?The collective and systematically instituted power to impose discipline upon a society. I make a distinction between anarchy and direct democracy.

[Bitter Ashes]

If more of something needs to be produced to maintain the target stock, then more resource would be diverted to that product. If less needs to be produced, then the opposite will happen.Actualy, I'm confused again now sorry :(
The "resource" that you meantion is workers right? :confused: So, like, if there's an excess of computer monitors, for example, but a lack of corn, how would you get those workers on the computer monitor line working in a farm? Anyway, I shall sleep on it as it's half 2 in the morning here. I'll see if I have any ideas in the morning and what other peoples' ones are. I'll probably feel dumb again.
Thanks and goodnight
x
-Rachel

[SocialismOrBarbarism]

Actualy, I'm confused again now sorry :(
The "resource" that you meantion is workers right? :confused: So, like, if there's an excess of computer monitors, for example, but a lack of corn, how would you get those workers on the computer monitor line working in a farm? Anyway, I shall sleep on it as it's half 2 in the morning here. I'll see if I have any ideas in the morning and what other peoples' ones are. I'll probably feel dumb again.
Thanks and goodnight
x
-Rachel

Workers, electricity, or even pay. It's not very likely that people will go from producing monitors to producing corn. They can produce something else like TV's or work less hours. If there isn't enough corn then agricultural workers producing something with less demand than corn like maybe hay can be told to grow more corn and less hay, since hay would have a lower priority. The world currently produces something like 12 times what is necessary to feed everyone, so a shortage of corn wouldn't be a big deal. If we have a shortage of something more important, like doctors, then we can always raise the amount they are paid.

[bobroberts]

It probably wouldn't function much differently than now. What would change is the reason why people produce things and the ability of private groups to manipulate supply and demand. If people stopped needing or wanting cars, there would be no institution demanding jobs or government bailout to protect the workers and CEOs since they would be taken care of and be able to move on to other pursuits without any of the horrible nonsense that accompanies unemployment. There would be no company flooding the streets and airwaves with advertisements trying to get everyone to buy their product because there would be no incentive for it. People wouldn't be forced to work some awful job to barely eek out a living, so places like fast food chains wouldn't flood every community on the planet with shitty fattening food. Most of the major reasons for waste and poverty in the current system would disappear.

[Yazman]

Scaeme:

The answer to this question greatly depends on your ideological leaning.. as a technocrat I put it to you that in a post-capitalist society there would generally not be such a need for "supply and demand" economics given that we have the resources today to eliminate scarcity in most sectors of society. Nearly all jobs today in the industrial and services sectors can be eliminated from the economy through automation with existing technologies.

Much of the time scarcity of a product is confused with waste. Eliminate wasteful practices and scarcity begins to disappear in many cases. Supply/demand economics is not really necessary given superabundance.

[ckaihatsu]

I'm still not entirely sure how, for example, a new production line would be opened up though. I'm guessing that when it's looking like more products need to produce an order would go out. Would it really be as simple as just asking the unions for construction workers to build a new factory and engineers to supply it with machinary for the factory workers?, getting them trained on any new machines and letting it go wherever it may from there?


Rachel,

Since the purpose of *any* economy is to supply to consumers, I would say that we should start there and find out what people's needs and preferences are. In a post-capitalist society *every* person would have a say as consumers -- thereby affecting the supply chain -- and also over the production process itself, as active workers in a worker-run economy. (Here's a one-page diagram that can serve as a quick overview: )


communist economy diagram
http://tinyurl.com/bom9ca





Perhaps there could be a forum on a board like RevLeft (or RevLeft itself -- whoo-hoo!) on which those who cared most about this issue would discuss * what kind of cereals * their local distribution center should stock. By default anyone who didn't participate in the discussion and decision-making process would have to go along with the decisions made by those who did. (This is the nature of politics, by the way.)


As far as economic authority goes, I think much of the determination would be made on the basis of material factors, such as how close resources (such as farm crops) are to a given production facility, to provide consumers at a relatively nearby location.

By contrast much production under capitalism is wasteful and inefficient because it is often non-local. If market prices favor production in factories overseas then that's what happens, thereby depriving local communities of work and wages while hyper-exploiting workers abroad. I advocate an orientation towards syndicalism as a preliminary step in the right direction:


Syndicalism - Socialism - Communism Transition Diagram
http://tinyurl.com/bgqgjw


Finally, I think we need to appreciate the hands-off, time-freeing aspect of automation that we could use to our full advantage in a post-revolution economy. In such a context it would not be so much about shifting workers to other tasks as much as it would be about the appropriate bodies of workers -- perhaps at a municipal, or regional level -- coming to a political agreement and then going to a website to shut down certain industrial processes while powering up other ones. (Consumers currently have access to a gizmo that can vacuum floors unattended -- think along *these* lines....)

Hope this helps -- take care,


Chris




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