The Collapse of the System…

Ok so now to answer the question whether the system tends towards stability or not… the following graphs show the evolution of agents 24, 50 and 76 work and wages over 1,000 iterations…

Agent 24

Agent 50

Agent 76

So far so good, and it looks likely from the graphs that some sort of asymptotic behavior takes place… so lets run agent 50 over 10,000 iterations and see what happens…Disaster! After about 3,500 iterations wages converge to roughly the demand total of the agent whilst work converges to zero!… let’s see the stats for all the agents after 5,000 iterations:

The trend is the same, wages converge to demand with a few outliers and work converges to zero!

What is going on? Well the short answer is because there is always a corresponding increase in wages to someone for every decrease to someone else, the ability for agents to keep work in check is subverted… this is actually observed in the Soviet Model to some extent… however there are two reasons to remain optimistic about wikibudgeting… the first is that the model fails to take into account price fluctuations and the recouping of money through sales… in short it assumes that the pot from which the wages are drawn always remains the same… and similarly for prices… adding this into the model could have some effect… secondly, the model only allows for increase and decrease of wages, there is no option for investment… adding the ability to invest means that money can be withheld from those who don’t work through spending… I’ll have to think about this some more… my brother has suggested I read Kalecki to get a better idea about the relationship between investment and wage negotiation… finally it is still an open question, whether there exists some strategy that keeps wages in check even in the limited set up of Model 1B… my suspicion is that the answer is strongly weighted towards the negative…