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Scarcity is the reason we require an economic system. Scarcity, in a sense, is related to the laws of nature that govern our existence. For example, if someone innocently asks: "why doesn't everyone have a yacht to cruise the seas? Why can't everyone have a luxury mansion?"
The fundamental reason why everyone can't have everything is scarcity: as producing a yacht requires the input of many resources; those producing yachts, rationally, require an exchange of value, higher than the value of the resources invested in the production of the yacht. The same applies to luxury mansions.
Why everyone cannot have a yacht, a luxury mansion, etc., is because we have a limited capacity of producing such items, yet many wealthy, value holding, individuals demand yachts and luxury accommodation. The demand is high, the supply limited.
The same applies to other valuable things, such as precious stones, precious metals, and other luxuries/some important necessities. Their production cannot be scaled, yet their demand persists, at times increasing. Goods & services in short supply yet highly demanded, i.e., not abundant, required a system, a mechanism, that would enable an efficient exchange and production of such goods.
After the decline of feudalism, capitalism, of course, has been the dominant system used for managing scarcity. Nonetheless, as wealth also works as units of capital for the wealthy, inequality has grown in recent years to all-time highs; incomes at the top of the income distribution have risen exponentially, yet median real earnings have not seen such increases.
Congressional Research Service (2021), in their report titled "The U.S. Income Distribution: Trends and Issues," state that "in 1975, the average income of households in the top fifth of the income distribution was 10.3 times as large as average household income in the bottom fifth of the distribution; in 2019, average top incomes were 16.6 times as large as those at the bottom."
Capitalism, thus, isn't a perfect system; exploring its flaws further, nonetheless, is beyond the scope of this work.
However, even if we disregard the problems of capitalism, if an improved mechanism for reducing scarcity arises, the world will naturally move towards it; It might even be regarded as a branch of capitalism. Thus, we can see that the core of this inquiry, i.e., what comes after capitalism, revolves around scarcity; scarcity is one of the primary reasons we need economic systems and, hence, the nucleus around which economic systems are based.
How can the problem of economic scarcity be solved?
Imagine a hypothetical country of '10 people. Let's assume that one person can produce a type of boat that the other 9 people want, and the other 9 people work in food production.
Which individual is most likely to get the boat? Of course, the individual that has a product that the boat maker desires the most in that particular period; if only one person can get the boat because there is only one boat produced, in a bartering society, the person producing the goods the boat maker desires the most, or producing goods that can be exchanged for what the boat maker likes, at the highest value, would be able to acquire the boat.
Now imagine an alternative: the boat maker makes a mechanism through which he can create more boats than anyone would require, the food producers create more food than anyone would require, and all items needed or desired are in abundance. In such a condition, we would have no scarcity, and thus, we wouldn't require an all-encapsulating mechanism for efficient allocation of resources or an economic system.
But how can such a condition ever be reached in the real world?
We are on a continuous path of progress in computing; this progress, in time, will open up an alternative world of quasi-material possessions, far easier to access and far less burdening on the system as a whole to produce.
Let's go back to the example of the yacht. What is the function of a yacht for wealthy individuals that motivates them to acquire it? Is it not the experience that it provides? Now let's imagine that the same experience, to the highest of degree and luxury, can be achieved while you are in the comfort of your living room. . . without any tangible resources or direct labor expended.
We can also use the example of other luxuries/highly demanded items: luxury foods grown or harvested without the input of any human labor, or luxury mansions built without human labor, designed by order of a commoner.
But how would this be achieved?
There are two important factors that would synergistically move us out of a capitalist system, as we know it today: the rise and progression of technology, and the decline of the human population; these two factors hold the key to the development of a new economic system. The fundamental societal realities would change due to these factors in the future, and thus, the mechanism society uses for the allocation of resources would change considerably as well.
The global birth rate per woman, which must be 2 for a population to remain stable, has seen a continuous decline in the last 6 decades; "the global fertility rate or birth rate per woman has dropped by 54% in the last six decades, at a rate of --1.28% (geometric mean) decline per year. As the birth rate falls below 2, the world will enter Sub-replacement fertility, with each new generation being less populous than the previous one (R.C., 2021; U.N., 2021).
At current rates, the global population would start to decline in about 20-to-25 years, around 2050, if current trends persist. Bricker & Ibbitson (2020), in their book titled "Empty Planet: The Shock of Global Population Decline," correspondingly argue that the global population would start to decline around 2050, or possibly sooner (R.C., 2021).
On the other hand, automation, machine learning, and robotics, are on a path of exponential improvement, similar to the exponential rise in power & availability of computers in recent decades. It is very likely that we would see a constant, exponential improvement & advancement in the implementation of these technologies; this implementation would significantly reduce the limitations of scarcity.
Most human tasks/functions required in agriculture, construction/development, transportation, health, entertainment, and other main sectors in economies, would be automated. In economic parlance, primary, secondary, tertiary, and even quaternary activities, required for the functioning of the economic system, would be eliminated.
The only activities that the majority of people would most likely be engaged in are quinary activities. i.e., activities related to idea generation, re-assessment & evaluation activities; essentially, only strategic "gold collar' professions would be taken up by humans.
Presently, if a person desires a very expensive luxury item, they can acquire it if they hold enough equivalent material value that the seller of that item would be willing to exchange it. But imagine a world where the lines between digital and physical reality are blurred; producing or providing new items in such a world may be as simple a task as a copy-paste command.
Other activities that are a requirement for human existence, such as agriculture, construction, health, etc., may become self-functioning in such a reality. As the marginal cost of production of food, housing, health care, once such a system becomes functional, would be zero, the world wouldn't need an economic system similar to capitalism presently, and as the utility of such a system is eliminated, it would no longer exist.
In such an age of opulence and abundance, there wouldn't be a requirement of risk-taking for economic gain, i.e., individuals rewarded disproportionately for their risk-taking so that they can be compensated for such behavior. Productivity would be abundant, with the marginal cost of new items produced practically being zero. In such an environment, with capital or factors of production themselves being so abundant that they are no marginal cost of acquiring further units of production, we wouldn't require a system that may be described as capitalistic in nature.
But how would such a system arise?
After a certain level of development of tech and robotics, a stage or a velocity of development that can be described as an escape velocity would be reached; at this stage, technology & robotics wouldn't need human intervention for further development/advancement but would require only a directional command by humans. The end of the capitalist system would most likely begin when this escape velocity is reached.
What that future system shall be called cannot be speculated presently; however, one thing that seems very probable: that future system would be based on abundance, and thus, can presently be described as the age of abundance, or 'Copioism' (from Latin—Copia, meaning plenty, and 'ism' from old English—forming nouns denoting a system).
Lastly, it is important to note that we presently know of only one practical system that can bring us closer to the technological escape velocity, as described in this work: that system, of course, is capitalism.
If we deviate and go back to the experimentations of the past, as conducted in the former Soviet Union, Laos, Venezuela, Yugoslavia, etc., we would prolong the period required to reach the aforementioned escape velocity and the end of the current system for the better. A considerable decline in world population is also a requirement for the discussed change, as we would never achieve an improved economic or societal system if the rate of population growth is higher than the rate of technological advancements.
Karl Marx famously said that "capitalism sows the seeds of its own destruction" This may be true, but not in the sense that he intended. The seeds capitalism sows may end it, not for the worse, but for the better, as capitalism is the only system that can practically provide us the 'passage,' if you will, to the age of abundance.
People acting in their own self-interest would continually create technologies that, in time, wouldn't require additional human input for further development and usher us in a new era, one in which scarcity is a thing of the past, for all practical purposes.
See also:
References
Congressional Research Service (2021). The U.S. Income Distribution: Trends and Issues. Retrieved from https://fas.org/sgp/crs/misc/R44705.pdf
Risk Concern (2021). Declining World Population & Property Prices. https://www.riskconcern.com/post/declining-world-population-property-prices-new-real-estate-developments-still-a-good-investment
U.N. (2021). Fertility rate, total (births per woman). United Nations. Retrieved from https://data.worldbank.org/indicator/SP.DYN.TFRT.IN
U.S. Bureau of Labor Statistics, Employed full time: Median usual weekly real earnings: Wage and salary workers: 16 years and over [LES1252881600Q], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/LES1252881600Q, August 1, 2021.
U.S. Bureau of Economic Analysis, Real Disposable Personal Income [DSPIC96], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/DSPIC96, July 15, 2021.
World Bank, Development Research Group. Data are based on primary household survey data obtained from government statistical agencies and World Bank country departments.