Having heard for the first time about the possibility of introducing the same prices all over the world in the framework of a new format of society – the Creative Society, any person with little or no background in economics, not to mention professional economists, may consider it as something fantastic. No wonder.
Today’s generally accepted economic theory states that the price is formed at an equilibrium point between supply and demand. Ideally, everything is simple: if demand increases, and the goods or services are scarce, the price increases. Conversely, if there is an oversupply of goods and services and stable demand, the price goes down.
In reality, of course, everything is more complicated because of the imposition of a whole group of so-called psychological factors, when the real needs of people are some, and artificially or spontaneously caused frenzy or negative information about the goods or services offered can cause sharp fluctuations in demand.
But for the first time in 6000 years, that is how long consumer society has existed, let us ask ourselves the question: what can be done so that prices are stable and gradually decrease over time, but never increase?
As in mathematics, let us try to find a contrary proof. That is, let us imagine that it is possible a priori. Since history and archaeology confirm the existence of stable economies of advanced civilizations, it really can be. And if we aim to move to a new stage of evolution, it will not be superfluous to find the prerequisites now, when the apogee of the consumer era is coming to its end.
Factors influencing prices
First of all let us distinguish between two main categories of goods and services: mass-market and unique arts of work which exist in a single copy and are almost impossible to standardize in terms of price. This is why we will be interested in equal prices for mass-market goods and services, which form the necessary basis for life.
The first thing we need is their stable production and uniform stocks. This becomes possible if we can plan everything in advance. Twenty years ago such a task would have been difficult to accomplish. But today, thanks to huge amounts of data and artificial intelligence, everything is possible. That is, we need a modern and improved version of planned economy, not of the Soviet type, of course, where there was a deficit, a black market and hidden inflation, but a realistic calculation of how much food, water, clothes, housing, services people need for a good and prosperous life.
The next task is how to ensure equal prices throughout the world, so that a kilogram of apples would cost the same everywhere. It is clear that in order to achieve this it is necessary to reduce the cost of transportation to zero.
Is it possible? At first glance it does not seem so. Today transportation costs often amount to two, or even three times the price of the goods.
Equal prices around the world
There are two possible solutions. The first is that the global community decides to make all transport free, i.e. to finance it independently. All transport flows are optimized as much as possible. Numerous intermediaries will be eliminated. Reasonable logistic chains with hubs will be built in such a way, that it is efficient and optimal for all participants of trade.
The second option – with the development of technology there are more efficient modes of transport, allowing almost instantaneous movement of goods to any given point in the world. The cost of transportation will be negligible. Would you say it is impossible? From the point of view of a person from the past, say, the nineteenth century, today’s speeds would also be perceived as beyond the limits of imagination. But they do exist.
And there is another important factor. Regional characteristics of goods or services are very important to us today. But let us imagine that the contingent technological industries of the near future allow us to simulate any conditions for the cultivation or reproduction of goods. In this case, we need not expect coffee from Brazil or bananas from Africa. They may as well grow in a conditional modern greenhouse somewhere beyond the Arctic Circle, no different in taste from the original. And a quality haircut or the preparation of a gourmet meal can also be safely transferred to artificial intelligence.
Moreover, some of the goods and services will have advanced properties – they will be tailored to the individual characteristics of the buyer. Artificial intelligence will remember what dishes you like and will cook exactly the way you liked it a month or a year ago, and your clothes will fully correspond to fashion trends and at the same time emphasize your individuality.
Such an economy of stable prices has another undeniable benefit. Instead of creating disposable goods with planned obsolescence, the whole society can finally switch to the production of super-quality goods that will honestly serve their owners for a long time, instead of being thrown away after a couple of months in favor of new trends in fashion. We will not have to spend huge resources, and then do not know where to dispose of the mountain of garbage, and deal with the pollution of the planet. After all, a diligent owner should have everything in its place in the household!