1. Services are definitely a bit more abstract. This was actually brought up by someone elsewhere - the example of household production was used. Let's suppose Bob wants to do a job that's going to produce $5 in GDP (has a cost of $5). Now Bob decides to pay Joe an additional $2 to do the job for him. Joe accomplishes the job and gets his $2 but only produces $5 of GDP under my model. It definitely means that the model is able to pick up production and capital. I will say, somewhere in that $2 costs are captured (let's say Joe is actual an Uber Eats driver, there's costs in there of fuel, opportunity costs, etc). So I guess my highly theoretical response is that "if the market is perfectly competitive and prices clear then the model still captures all GDP - Bob has an opportunity cost of >=$2 afterall or he wouldn't have paid Joe to do the delivery". But I know that's a bit overly idealistic.
2. If the two things had absolutely no cost of being merged and they were just poofed together, then no we wouldn't account for that. But presumably it costs the player some sort of resource in order to combine those things. Or they had to spend a bunch of fuel/ammo/food etc in order to achieve that thing (those costs would be accounted for in GDP). That said, my model doesn't really value people's "time" all that much. That's intentional though. If you've got 1000 players moving around a space doing absolutely nothing and spending no money... then it's not really an economy and there isn't a whole lot of production. We wouldn't slap a wage on someone's time just for the fun of it. It's got to be something that's paid by players/users/investors. That all said, if the economy has an explicit cost structure in place (for example, an NFT rental program), I could see very easily incorporating that into the GDP model very easily.
Thanks for these questions, I found them very thought, provoking!
I envy that you get paid to think about this haha. One of the most fun things I've read in a while.
Appreciate the clarity. I like the idea of service margins shrinking over time as markets become more competititive and as services become more commoditized. Yeah agree there's probably very little meaningful service markets enforced onchain (let alone in autonomous worlds) not least because legal contracts that enforce service standards aren't available.
This is very, very cool. Using market prices for non-fungible assets seems very unreliable so I love the approach to look at inputs.
Couple of questions:
1) How do services feature in this context? E.g., a Sablier stream that would be paid to hire someone to support a guild.
2) What happens when multiple non-fungibles are merged to make a new non-fungible? Are we assuming 0 added value in this context?
Such a fun thing to explore. Looking forward to the day DeFi Llama has a GDP dashboard for autonomous worlds or at least some Dune dashboards.
1. Services are definitely a bit more abstract. This was actually brought up by someone elsewhere - the example of household production was used. Let's suppose Bob wants to do a job that's going to produce $5 in GDP (has a cost of $5). Now Bob decides to pay Joe an additional $2 to do the job for him. Joe accomplishes the job and gets his $2 but only produces $5 of GDP under my model. It definitely means that the model is able to pick up production and capital. I will say, somewhere in that $2 costs are captured (let's say Joe is actual an Uber Eats driver, there's costs in there of fuel, opportunity costs, etc). So I guess my highly theoretical response is that "if the market is perfectly competitive and prices clear then the model still captures all GDP - Bob has an opportunity cost of >=$2 afterall or he wouldn't have paid Joe to do the delivery". But I know that's a bit overly idealistic.
2. If the two things had absolutely no cost of being merged and they were just poofed together, then no we wouldn't account for that. But presumably it costs the player some sort of resource in order to combine those things. Or they had to spend a bunch of fuel/ammo/food etc in order to achieve that thing (those costs would be accounted for in GDP). That said, my model doesn't really value people's "time" all that much. That's intentional though. If you've got 1000 players moving around a space doing absolutely nothing and spending no money... then it's not really an economy and there isn't a whole lot of production. We wouldn't slap a wage on someone's time just for the fun of it. It's got to be something that's paid by players/users/investors. That all said, if the economy has an explicit cost structure in place (for example, an NFT rental program), I could see very easily incorporating that into the GDP model very easily.
Thanks for these questions, I found them very thought, provoking!
I envy that you get paid to think about this haha. One of the most fun things I've read in a while.
Appreciate the clarity. I like the idea of service margins shrinking over time as markets become more competititive and as services become more commoditized. Yeah agree there's probably very little meaningful service markets enforced onchain (let alone in autonomous worlds) not least because legal contracts that enforce service standards aren't available.