Socio-cultural Ties and Economic Development

The search for new ways of economic development through the interpretation and properties of the continuum of social ties.

The author’s conviction that it is always productive to look for new possible points of view on subjects that seem to us the most familiar and ordinary, was the reason for writing this article. The search for new ways to interpret the existing arrays of knowledge and experience, as well as newly received data, can give us the opportunity to build new concepts of the world and, using them, try to extract interesting and useful practical results. Our article is an attempt to briefly describe the view of the structure of the economy as a function of social ties in the social space.
It can be said that the subject of the author’s reasoning are the following questions.
Is economics a natural phenomenon or purely social?
How is the processing of information in a group, its, so to speak, group Internet connected with economic reality?
What meanings of economics do we not yet distinguish?
In which direction is the economy moving?
Why was the USSR economy possible and what was it like?
Are the current methods of economic management applied in the world adequate?I spent my first third of my life in the USSR, completely uncritically perceiving it as a kind of rebus. The next part of my life was spent in endless movements between and inside the constantly discouraging wreckage of the USSR and the rest of the world: first of all, the rapidly changing China. And it’s not yet clear how the rest of my life will go.

Due to deep immersion in reality, in my case – in economics, a certain distance is always required for introspection and comprehension of one’s own and others’ experiences and views.

The economy is traditionally perceived by us as a part of human culture and all its concepts somehow offer interpretations of this area of culture as a kind of complex system consisting of other less complex systems, which in total gives some new qualities. However, different interpretations of economics used different primary single elements (systems) to describe the entire area and search for any patterns there. In the history of thought, such phenomena as: needs or economic needs, goods, decisions and goals of economic choice, economic resources, production capacity, dual oppositions or connections\contradictions in Marxism were used as such elements for example, economic agents\consumers and producers, and so on. And, no doubt, other tools of description and thinking will be used in the future.

In human thought before the beginning of this century, the question of whether the economy is an exclusive part of human culture or not was rarely discussed. Is there an economy outside of the human species? Now there are many studies showing that the principles of economics work in other fields, such as biology, ecology and even physics.

It must be said that back in the 19th century, the German biologist Ernst Haeckel (1869) defined ecology as “a field of knowledge that studies the economics of nature – the study of the general relationships of animals with both living and inanimate nature, including all friendly and unfriendly relationships with which animals and plants directly or indirectly come into contact – in a word, ecology is the study of complex relationships that constitute, according to Darwin, the conditions of the struggle for existence” [225].

Summarizing the views, it can be noted that the economy is based around the physical principle of minimizing costs and energy levels when choosing a stable state of the system. [1] Over time, the economy manifests itself as an area of behavior associated with various methods of reciprocity (from the Latin reciprocus — returning, reverse, mutual) with minimal costs. It is important to note that the economy, in the author’s opinion, does not aim to satisfy the material needs of a person, or to achieve profit or any other social values. Below we will show that the activities of economic participants do not always meet their real needs, although all these events often occur in the course of economic activity. I assume that economics cannot have any goals at all, and it, like the phenomenon of time, is a projection of physical dependencies and laws on human society. Our economic behavior, as well as the memory of the time of our life, is realized through our stereotypes and memes created by society, through the behavior of groups and individuals, but basically economic behavior can be reproduced without human participation. It can be shown that economic stereotypes, in most cases, rather force a person to do something that is completely unprofitable for him as a person, thus serving the economy itself as a social and natural phenomenon (a perfect example of this is parental behavior, certainly related to the economy and certainly unprofitable in today’s reality for the actor), and not at all individual human needs. I tend to think that economics is fundamentally inhumane and is linked to our civilization as a natural process.

Economics, intelligence, the behavior of higher animals, human behavior, society – all these phenomena often encourage their researchers to use the concept of emergence as a way of interpreting them.[2] Such processes can be represented as a function of communication between the elements of the included groups. If we consider the evolutionary descriptions of various systems – biological, social, as well as the history of the evolution of human knowledge, we can see that they all describe systems of constantly increasing in number, diversity and density of connections arising in the process of reciprocity (redistribution and exchange) of information or material objects or joint efforts in all developing systems, for a number of exceptions (the phenomenon of degradation of systems that have lost a particular fight for any reason on any field). This manifests itself in various spheres: economics, industry, writing, television, sound recording, money, computers, artificial intelligence. All these cultural and social phenomena have emerged as a tool and symbol of some kind of relations, their scaling and exchange, and, as a result, they constantly note an increase in the number of connections in a developing system or society.

In our efforts to give a new interpretation to our knowledge. We will try to redefine the concepts of the economy itself, value, subject-economic turnover, or, for example, such an important concept for the economy as a commodity, from the point of view of their emergence from the continuum of social ties (transactions). So you can redefine the product as a special form of ties, which is the primary relationship. A commodity in the economy is a form of service provision and, again, a mechanism for multiplying social ties. The descriptions of human social ties that we will consider in this article are related to one or another interpretation of the continuum of social ties in the field of human culture, which we used to call economics. In particular, we want to show that the density of such connections in time is ultimately directly proportional to the well-known concept of value.

In this context, emergence is the ability to choose ways and options for solving problems within a conscious continuum of ties, as you, for example, have different choices of roads from thousands of paths in a huge forest. Any economic production is a billion of such ties. As technology becomes more complex, the number of ties grows. This explains well to us the procedure of historical inflation, when money always becomes cheaper and goods are more expensive. This is because the number of ties necessary for the production and consumption of goods and services is increasing. But this is offset by the fact that the economy as a whole is also growing due to the growth of labor productivity, and each person gets more and more resources under his control. Now it is quite normal for a person to receive 3 thousand dollars a month for his work, and this is the equivalent of about 3.8 kg of silver. History knows that, say, in the 11th century, for example in Norway, this is the price of 30 good cows or 50 slaves, and this was the income of a hierarchically exalted person of a local king or a sovereign prince. Labor productivity can then be defined as the number of newly emerging ties per unit of time.

We should immediately warn you that the word emergence itself does not explain anything here. There are several types of words in the language. For example, there is the word cup. The cup, it seems to us, is easy to translate from one language to another because it is similar in its functionality in any culture. And this makes up one group of words denoting well-known and well-mastered objects. And there is another group of words that does not contradict the first, but it does not have a direct practical functional use, like the word cup. We use it to make us more comfortable, as our brain strives to verbalize everything around. And words such as information or emergence, for example, are words whose designations are not exhaustive. We do not fully know what they mean and what they are for. In fact, words are needed to name our ignorance. We use them when we see that the objects around us have similar abilities to each other, transfer something to other objects or accumulate this “something” in themselves. But the real content of this “something” is a mystery to us. Emergence is understood to us precisely as such a word.

One of the properties usually attributed to emergence is that the system of elements is not identical to the sum of the properties of these elements.[3] This is a certain property of a system of some objects that cannot simply be reduced to the sum of the functions of all these objects, as can be done in the case of simple words like “cups”. Emergence is the ability of system elements to make some kind of choice between several states. An example with the same cup. If we make a movement with our hand on the table, the cup may fall. There are three possible states of the cup. The cup will fall and break on the floor, the cup will crack, or the cup will survive this fall in integrity. But in the case of the behavior of higher primates and their social connections with each other, there may be much more than three possible scenarios, as was the case with the simple inanimate concept of a cup. Because we are more complicated than a cup. Moreover, primates and humans are also affected by a lot of surrounding factors of the past and future that affect the final result of the event. The conclusion here is that the more such variants of the outcome of an event, the higher the emergence in this system and the more it is close to the phenomenon that we call intelligence. This means that we can identify emergent properties with the ability of the intellect to make choices and make some decisions at a higher level. It’s just that the cup has a small number of choices of solutions that it will have after falling off the table. And in the case of primates or humans and their social connections, these choices are billions of times more.

Returning to economics, we see that in the historical perspective there is an almost constant expansion of the number of face-to-face and correspondence contacts of a person related to his activities as an individual or collective producer, market participant, producer of services or goods. This is not necessarily a purchase-sale relationship. And these connections are often not in the nature of economic benefits. These are connections aimed at ensuring reciprocity in the group so that it becomes stronger, but they may be unprofitable for an individual or their group.[4] The more social ties there are in a group, the more effective it usually is, the higher its group intelligence and the more stable the culture of this group in history. The more ties there are in a group, the higher its emergence in turn. Accordingly, its competitiveness is higher and, as a consequence, its value and even cost. The most stable cultures in history that have created the greatest values are civilizations that, for whatever reason, systematically maximize economic ties in their history. We see that the rice-growing peoples (China, Japan, Vietnam) with their own way of farming and economic relations, caused largely by the peculiarities of its cultivation, created most of the value on the planet before the era of industrial production, and have preserved the continuity of their culture traditions to this day. Unlike their contemporaries, the nomadic peoples, whose ties were simpler and from whom nothing now remains but forgotten mounds.

Let’s pay attention to how production used to exist.[5] Initially, everything was done inside one enterprise. If someone three hundred years ago received an order from the British Crown for guns for the navy, then he had to extract ore, clean it, make additives and coal for melting, melt iron, clean it, make a cast iron alloy, and cast guns. Next, the hired carpenters had to make gun-carriages, and then all this had to be brought and put on the ship. Who makes a cannon today within the framework of one economic enterprise? Nobody. Thousands of contractors are making spare parts, someone is making a project, someone is assembling the final product, someone is testing, someone is developing control devices, someone is making tooling for the assembly site, someone is supplying spare parts. It is more cost-effective to act this way, and this applies to almost all spheres of economic activity. Currently, narrow specialization prevails and, accordingly, the ever-growing division of productive labor.

Let’s go back to the example with the cup. It is interesting to note that the same things become completely different over time or in different cultures at the same time. For example, take the fate of a cup of vegetable soup in the last thousand years. In order for us to have lunch with soup, we need this cup or bowl and the soup itself. And if you look more closely, then a cup from the point of view of economics and social relations in England of the XI century and now in the XXI century are completely different objects as social phenomena, although outwardly and from the point of view of consumer properties they can both be exactly the same. In the Middle Ages, to serve soup in a tavern, the owner of the establishment had to grow vegetables himself or his family or his employee in his garden, collect them, when receiving an order, go for firewood, boil water, leave everything necessary there, boil, add salt, stir and everything is ready. Before that, of course, you need to buy a cup where to pour the soup. It can, like the cooking container, be purchased from a potter, who also did everything himself: dug up clay, soaked it in water so that it became homogeneous, then worked on a potter’s wheel, covered the dishes with glaze and made it impervious to moisture, then sold. As a result, when a visitor or we ourselves, if we could somehow find ourselves there, came to the tavern to receive a service in the form of a cup of soup, he indirectly became a participant in several transactions: starting with the one in which the owner of the tavern inherited it, this is a hereditary transaction, in that the owner himself grew vegetables, collected and cooked them, bought a cup and a pot made by a potter, someone else assembled a table. In general, several dozen real transactions were made so that someone could receive a single service. In more primitive communities, the same action could have been based on single transactions altogether.

Today, if we go to a modern restaurant and want to eat exactly the same vegetable soup, everything is completely different. If the institution belongs to some network community, then it can be a public company that has already made millions of transactions in order to exist. This company issued shares, hired underwriters and investment banks, bought equipment for cooking, which in turn was created by hundreds of companies, as well as furniture and building materials – these are all hundreds and thousands of different manufacturers. Even if the author of the soup is a family restaurant, the Products were still bought from a dozen different suppliers, from which the initial manufacturer is very far away. And it turns out that in modern society, a person of the middle ages, unlike primitive communities and not at all primitive in the field of culture, is dealing with a million transactions to eat the same soup. [See5] Such examples clearly show us that the economy is also a measure of complexity. The more complex a society is, the more economically developed it is, and complexity is measured by the number of ties reproduced within it. The more ties we have created, the more developed society becomes, and the fewer ties, the less developed it is. Our first thesis is that if we want to create a successful and rich society, we must first of all increase the number of ties in the economy. The value of the goods is directly proportional to the number of ties within and around the products of human activity, and in fact is the designation of their measurement. The value of an object, or its value, is a function of the number of ties that arose during the creation and handling of the object.

Almost always, home-made things – created by one or a few people – are more expensive in developed markets than similar industrial products, however, this is only a consequence of the peculiarities of the economy in developed markets. In their home markets, they are discouragingly cheap.

An example of the introduction of assembly line production of cars (in general, any industrial production is a concept of Fordism) perfectly illustrates such processes. When comparing the assembly of a car on a slipway (a single process) with the assembly of a car on a conveyor, you can notice that: 1) the number of parts for the assembly of the car (purchase of spare parts and equipment) is approximately the same, 2) the total number of operations during the assembly of the car due to a more efficient organization of labor with such an organization of assembly is significantly less, 3) accordingly, the amount of value created by the same number of employees for the same time on the enterprise with conveyor assembly is noticeably larger due to the higher efficiency of labor (the same number of workers will assemble more machines in the same time) and a greater number of ties per unit of time. This will make it possible to sell a single car cheaper than a car assembled on the slipway, and will provide a competitive advantage in the economy. This applies to the entire sphere of industrial production and is its essence: the increase in the value created by economic entities per unit of time leads to a decrease in market prices for their individual products. This well-studied phenomenon, described traditionally in terms of commodity production, looks different if we consider it through a continuum model of ties, for example: separating operations between contractors and subcontractors increases the continuum of ties and the value of products; and companies that produce nothing but a billion ties are expensive because ties are value; and so on.

That is, we see the impossibility of considering any economic objects as isolated, and consider them as continuums of ties in social space. Thus, we understand that tens of thousands of people made one cup. They did not make it directly, but were connected in the economic interactions that led to the appearance of this cup. This leads to the fact that in societies that differ in the development of sociality, exactly the same objects or processes are absolutely different. Therefore, a direct translation of meanings, or the transfer of phenomena and objects from one society to another without distortion is impossible. This is due to the fact that these objects are functions operating in different systems. Because of this, the products created, even outwardly identical in purpose and meaning, are completely unequal in different economies in terms of development. That is why very often attempts to transfer such products from the societies that created them and perceived them as part of their language and thinking, to societies with a different history and culture, lead to ridiculous and at the same time tragic results. For example, projects to introduce socialism or democracy in Afghanistan\Iran\Iraq, etc. Because, for example, democracy is not just the legal election of the president by the majority of the country’s population, it is the way of thinking and the language of people and the sum of their social relationships. That is why it is almost impossible for us to understand medieval Chinese and Japanese poetry or Vignon’s absentee poems. That is why the collapse of colonialism in Africa eventually led to the collapse of civilization there.

It is impossible to summarize all the important ideas in such a text, but, of course, an interesting aspect of any consideration of economics is the consideration of money and monetary policy in the economic interpretation of the world. The phenomenon of money itself is not inherent in the economy initially, and is unlikely to always accompany it. This is a coming meme, and most of human history, which is about 50 thousand years, has passed without the concept of money, although the economy existed quite well. Money arose in the course of the growth of communities and the resulting need to fix, and later depersonalize, ties during their verbalization. It is impossible to keep in mind all the diversity of ties in a noticeable community without any technical means of fixing them, due to biological and communicative limitations, therefore universal tools for fixing ties have emerged. Later they began to be used as units of exchange. With the development of technologies involved in the economy and the ability to record data on all the ties of individuals and economic agents, sooner or later money, as it exists today, will become unnecessary and disappear. Money is always a metaphor for social connections. The possibility of studying money as a matrix for metaphorical reinterpretation was pointed out by J. Lakoff, because money has some properties of language. [6] Ancient thinkers also often came to understand the interaction between economic and intellectual exchange, or between money and language. (“Sema” in Greek means “word”, as well as “coin”.) Plato, for example, criticized sophists and pre-socratics as mind merchants not only for taking money in exchange for useful or “honey” words, but also for being producers of discourse, the internal exchange of meanings of which was identical to the exchange of goods and monetary transactions. Here we see parallels with the sphere of services of consultants and therapists, noticeable for modern times. Plato feared the political orientation of their monetary words and presented their discourse in his dialogues as an audible symptom of an invisible intrusion into the language of a tyrannical form, destructive to wisdom. The multiplication of ties in culture has automatically expanded the space for the language of money. And mutually, the metaphor of money has expanded the space of ties, creating new ties where they did not exist before. We see that having a certain amount of cash dollars in the most remote African village, you can get a lot of useful services without speaking any local language. The language of money has had a strong effect on the perception of people, especially their educated part, which is forced to exchange the activity of the intellect for these metaphorical objects. This largely contributed to the fact that the economy began to be mistakenly perceived by the educated public and even by many economic researchers as an activity aimed at obtaining benefits [7] or creating added value (as in Marxism). We believe that economic behavior, at its core and at its beginning, was completely unrelated to benefit, and there was no concept of benefit itself. If it is considered holistically, it is not connected with private interests at all. At the beginning of history, this kind of interaction and contacts had no other meaning than survival, moreover, as they wrote above, the efforts of a person in a group seemed to be of no use to him. That is, a person often worked more in order not to get anything from material goods as a result of his work, rather he could get something social, for example, “moral authority”. Only gradually, with the growth of connections and the effectiveness of economic activity, there was an opportunity for the emergence of concepts of profitability and profit. The history of the economy of the USSR and the countries of socialism has remained unexplained, because its interpretation in terms of individual or social benefits and utility is impossible. It should be noted that the economics of socialism becomes more understandable in the context of the metaphor of connections. Equalizing communities have arisen before, but with advanced technologies they were unstable and usually did not live even one generation. The USSR existed for 3 generations. It can be suggested that the reason is that the Russian Empire was a rather archaic community, and the social process of the revolution and subsequent events significantly complicated this society and processes. The complications of society and the creation of new social ties (education, urbanization, industrialization, scientific revolution) occupied society, they maintained this whole system in dynamic equilibrium with destructive forces.

This is, of course, an extremely superficial judgment, but the emergence and long-term and relatively successful existence of an economy that ignores a number of principles that are fundamental to other societies suggests that fundamental economic factors also act outside of these principles.
This interpretation of economic behavior leads us to the conclusion that economic stimulation and management of economic agents, widely used in developed and developing countries, is now often focused on false goals, being, in fact, errors of thinking (stereotypes). They arise due to cognitive biases, on the basis of which such a perception and interpretation of events occurs, as a result of which assessments, conclusions are formed and decisions are made, and out of connection with the actual situation. The reasons for this can be both subjective and objective factors, and they are often associated with established stereotypical beliefs or social patterns associated with a lack or overabundance of information. It can be argued, and this is our second thesis, that the entire modern economy, and especially politics and history, are based on such errors of thinking. Let’s explain.

Stereotypes of thinking are created in early childhood and in the course of individual growing up, in the process of interactions between individuals as a product of their communication using technologies available to them at that time. In the social sciences, the concept of stereotype goes back to the definition of U. Lippman [8], which was later developed by G. Allport [9]. This concept of stereotype is based on the perception and processing of information about the social world, as well as on how these processes are socially captured (receive social consolidation). Stereotypes are some kind of figment of imagination, a fiction that helps explain the world around us. According to U. Quasthoff [10], a stereotype is a verbal expression of a certain belief directed at any social groups or an individual as a member of a group. A stereotype is expressed in the form of a judgment that, in an unreasonable, simplified and generalized form, with an emotional and evaluative tinge, considers any abilities or behavior peculiar (or, conversely, unusual) to a certain group of people. Social psychologists R. Bergler and B. Six [11] place a different emphasis on the definition of stereotypes. In their opinion, stereotypes are stable, widespread, erroneous cognitive formulas that play a key role in the processes of facilitating the solution of everyday life tasks.

Socially determined stereotypes, they are also errors of thinking, create all our social institutions and structures, services and products called goods. For the first time, cognitive biases were discussed in the 1970s, the theory of this was put forward by American-Israeli psychologists and scientists Amos Tversky and Daniel Kahneman [12]. Scientists in the course of joint research found that when performing any actions, a person is guided not by rational and logical constructions, in their case by statistical data, but by actions, especially in conditions of uncertainty, relying on intuition, template judgments and stereotypes, which led to mistakes.

There are many types of cognitive biases in humans. [13] Modern researchers present them in the form of four categories: 1) “When there is a lot of information” (problem: an overabundance of information), 2) “When there is not enough information \ meaning” (difficulty of understanding), 3) “When we react quickly” (the need for rapid response), 4) “When we memorize and recall” (the ratio of the remembered and forgotten). Among this number of categories in relation to economics, several typical errors can be distinguished, which in the general classification of such phenomena relate to biases associated with behavior and decision-making. The first of such cognitive biases associated with the economic policies pursued by countries is amplification. It belongs to the category of excessive concern for success. Amplification is an investment in achieving a goal of more effort than is necessary. A variant of this is too detailed planning in the absence of sufficient data and the presence of uncertain or random factors that strongly influence the result. If we look at government planning programs in many countries or similar development programs of large corporations, we will easily find signs of such biases of perception.
Many cognitive biases encountered in modern economic policy belong to the category of overestimation of their capabilities. Among them is the well-known Dunning–Kruger effect. It occurs when people with low qualifications make erroneous conclusions and make unsuccessful decisions, but at the same time are unable to realize their mistakes due to low professionalism and sufficient knowledge. Next comes the Overconfidence effect. It is understood as a widespread tendency to overestimate their own abilities. In the same row is the Illusion of control or the desire of people to believe that they can control or at least influence the results of events that they cannot actually influence. The Zero-risk bias helps to reduce the feeling of possible danger, which is based on the choice of moving towards a controlled, but potentially more damaging situation from the point of view of economic effect. In other words, choosing the least of the evils. The category of errors, called Overestimation of the significance of particular cases, refers to another type of cognitive bias, as a deviation in the direction of the result. This is making judgments about decisions based on their final results, instead of evaluating their quality of decisions based on the circumstances of the moment when they were made. It is possible to describe dozens of such cognitive biases and their inclusion in the fabric of social and economic life, but this is clearly beyond the scope of this article.

Back in the mid-1970s, the British evolutionary biologist Richard Dawkins proposed the theory of memes. By analogy with the fact that all biological information consists of genes, all information significant for culture and society consists of units called memes [14]. They represent any idea, symbol, manner or way of action, consciously or unconsciously transmitted from person to person through speech, writing, video, rituals, gestures, etc. The system of stereotypes represents the same social reality. And in this respect, it is the same to memes. According to Dawkins, memes, like genes, have the ability to replicate, can multiply and be transmitted vertically from generation to generation, becoming artifacts, and horizontally between people, and then, taking root in the environment, are some patterns and stable models of thinking and behavior. Depending on the conditions, memes can modify, interact, participate in the struggle for resources, survive or be destroyed, as well as mutate. Memes are behaviors, religion, various doctrines and political concepts. Based on this, to some extent, the economic reality, consisting of foreign exchange reserves, entrepreneurship, banks, offices, mass production, information processing, concepts of consumption, goods and consumers, ways of economic behavior, are also memes. At the same time, functioning for a long period in the same environment, they form habitual stereotypical behavioral mechanisms, which over time become distorted and become errors of thinking, since they are not always relevant to the real situation, not keeping up with the course of events. That is, the current thinking with such stereotypes guarantees us the inadequacy of our reaction to the events taking place.

Perhaps it is always necessary to test all economic solutions, if possible, in isolated economic systems, in a real economic environment, before relying on their effect. So, for example, the economic behavior of the state in China was built during the construction of the modern economic model. At the same time, it should always be remembered that memes are temporary constructions, they exist for a while, and then disintegrate under the influence of new technologies, the changing structure of human and natural connections in social reality. New memes appear in their place, and this is an ongoing process. Therefore, everything we are used to is also temporary phenomena. That is, any banks, offices, the very concept of modern entrepreneurship, the concept of investment and business are all coming phenomena that will disappear in some future, but it is not yet known in which. In addition, memes are almost always irrelevant to reality. They, to some extent, are reality itself, because we perceive from it only what we can perceive. For us, reality is very important, but it is coming, as well as the concept of our thinking, formed under the influence of the need to survive and manage stress, so in crisis situations you do not need to cling to formal tools, but you need to look for other ways, new scenarios of behavior and tools of reaction to events.

Economics in this way is an attempt at an emergent description of the continuum of connections and transactions in culture, including cognitive biases\stereotypes\memes. Memes can be services and products that are created and changed due to an increasing number of social connections. We should also note with regret that all of these cognitive biases of human thinking are living participants in state and corporate regulation and management. Usually, regulatory goals are aimed at stimulating and motivating the population and enterprises to consume goods and innovations, or to stimulate investment. However, we see that this is wrong. Some benefits are absolutely necessary in some places, but, by and large, they become unimportant, since the most important thing is to stimulate ties within society in the economic and cultural sphere. The more of them, the more information and opportunities economic agents have. The more ties market participants have, the more options they have to choose between different types of economic behavior. As a result, this directly affects the development of countries and economic growth. Hence the conclusion: the task of people who want to bring something new into their own and public life is to aggressively change memes that multiply public relations. Also, the systematic motivation of people to endless consumption of goods and services is dangerous for society, which challenges the very nature of human intelligence as a thinking being and turns his life into a senseless pursuit of objects he does not need.

Heraclitus said: “War is the father and king of all”, meaning not so much war as such, but confrontation.[15] Why? Because confrontation is the most effective form of interaction. In everyday human activity, it is often very indirect. The main character of the film “The Matrix” by the Wachowski brothers Neo says that you can only recognize a person in battle. This means that a person is fully realized in confrontation and in opposition, and only in this way can he understand how he himself is arranged. Economic struggle as a social elevator has replaced war as such, displacing it as a more effective way of competition of the human species. Also, it should be noted that economic behavior in its entirety is devoid of any substantial goals (success, wealth, capital, survival, recognition, and so on and so forth), and, in general, represents the implementation of the physical, that is, biological and ecological, principle of minimizing the cost of resources for any action. With regard to the economy, the basis of which is a set of various relations, an effective way of progressive movement in modern conditions can be the stimulation and multiplication of connections between economic actors by individuals to expand the possibility of choice and create optimal solutions.

The main provisions of such a concept can be described as follows: the emergent economy refers to individual acts of reciprocity of both human beings and any other objects involved in interaction with society, including plants, domestic and wild animals, and artificial intelligence. The concept space also includes the existence of stereotypes and memes in society, the training and retraining of people, the construction of new social elevators taking into account local cultural specificity, since economic wreckage opposes order in thinking, the stimulation of economically active behavior of all members of society (children, women, pensioners), a complete revision of school education in the field of economics with focusing on practical skills of economic activity and communicative activity. In the near future, drug therapy of social groups is possible to increase their economic efficiency, since such a social phenomenon as poverty can be considered as a mental disorder and it can be corrected by various pharmacological and educational methods.

Considering social ties as a discrete element of the economy motivates us to change the competence of artificial intelligence (AI) as an active actor of the economy. This, it seems to us, is an inevitable process in the near future. It is necessary to enable AI to make payments, take legally significant risks, create a system of liability insurance for its actions, etc. After AI will be able to buy and sell products themselves, compete and interact with each other, this will turn them into full-fledged economic agents. It is extremely important that the number of AI in the economy may exceed the number of people by several orders of magnitude, and this will give rise to a new exponential growth of the global economy. The national regulator and the economy that will make decisions on changes in the status of AI will win the fastest.

We see that since connections occur over time, their density (this is actually their cost) depends on the frequency of circulation (occurrence and termination) of ties. Accordingly, any reserves and provisions, any ownership of non-circulating assets and items in general bring down the value of the economy or companies, and the creation, for example, of reserves of currency or gold by Central Banks is also, in our opinion, another cognitive error described by us, a bias\stereotype of human thinking in the economy. It is important to involve all unused assets in commercial activities. In this sense, the sharing services of any economically significant agents such as Uber or AirBnB are extremely progressive. Any business concepts involving inefficiently used assets in economic turnover, as well as the entire world of smart things being created, will be extremely promising.

For development in any conditions, it is important to carry out maximum demonopolization, eliminate inefficient establishment and stimulate broad social elevators in creative spheres of human activity, eliminate inefficient public property unrelated to the functions of the state. Also, we need massive advertising of personal entrepreneurship and a rapid increase in the number of economic players in the national market.

The real development of the national economy cannot be achieved without an increase in commodity emissions or rapid growth in productivity and gross commodity output supported by demand, and there is every reason for this now in the world, for example, by replacing all existing things with smart objects. This is a reinvention of all things on a new theological basis, as smartphones have replaced phones. Massive but controlled stimulation of the creation of new industrial capacities is needed. An important condition is the maximum acceleration of money turnover, the stimulation of the creation of new payment platforms, the legalization of the use of a number of non-anonymous cryptocurrencies and the accelerated introduction of electronic money settlements, reducing the role of cash circulation in the economy.

From the point of view of the development of the economy, it is important to speed up the introduction of “smart” things and robotic means of delivery in all spheres of the economy, as this will lead to an exponential increase in the number of social connections. It is important that robots learn how to sell goods and services to robots. This will allow exponentially increasing the number and intensity of connections and the number of consumers and economic agents, as a result, to make a qualitative leap in economic growth.

I do not pretend that these ideas are entirely my own. I synthesized them from common themes and patterns of other people’s work in a variety of fields and industries, in which I incorporated my own ideas. Indeed, this ability to synthesize disparate viewpoints, datasets, and ideas is one of the abilities that is important to develop in this new era. The new is always sudden and it is important to have time to choose the right path. Currently, we are flooded with new systems and technologies. There is not a single area of human activity that is not currently subject to a multitude of ramifications of the future, each of which is represented by a new discovery, business model or invention. Another aspect of the present moment is stranger. A complex system, as mentioned above, is a system in which order can arise from chaos, and chaos from order. The behavior of the system cannot be reduced to the sum of the shares and the behavior of its parts. This is also the case when power and structure are created by the network, and not decreed by the hierarchy. In response to any actions, a cascade of reactions can follow, affecting each other in such a way that can suddenly transform the entire system into a new quality. Relatively simple rules govern all the individual components of any emerging system, but when they interact en masse, they can evolve into complex adaptive structures.

In the business world, this behavior of complex systems and their emergence explains why some tech startups may have a sudden explosion in their evaluation and a rapid expansion of their functions. It’s not the app or website that creates value, but the collective behavior of all the people connected to it. As of the end of 2016, Facebook has become so densely populated that it is no longer considered just a social network. Thanks to changes in the atomic content of its more than 2 billion users, the company has become a de facto political organizer, a major (albeit very problematic) news source, a global video distribution platform and a market for goods, and even jobs. The key to many of Facebook’s features is its size. As soon as any system becomes capable of exhibiting emergent behavior and demonstrating the presence of group intelligence, the rules governing it and the internal laws of work begin to lead to fundamentally different, and sometimes useful results.

Ants are a classic example from nature. As noted by the famous biologist E.O. Wilson [16], ants exhibit the most complex social structures after humans. However, these structures arise from simple behavior. In a colony, when ants trace and redraw the hormonal traces left by other ants during their wanderings, the result is anthills, efficient exploitation of all nearby food supplies, the ability to protect their homes and territory, migrate and survive a catastrophe. Some ants have no direction, but after reaching a certain point in their population, their collective intelligence and abilities become an order of magnitude higher. For ants, more means smarter. The resulting intelligence allowed them to survive relatively unchanged over the past 90 million years.

It may seem to residents of Europe and North America that this collective reorganization around the digital information flow has already taken place. But this is a misconception caused by the widespread popularity of the industries that were the first to digitize: music, finance and journalism. The reality is that digital transformation is just beginning. According to McKinsey, 82% of the US economy has not yet realized the full potential of digital technologies. And some of our largest industries, such as manufacturing and healthcare, are actually among the least digitized. The growth potential driven by digital technologies is even greater in developing countries.

A prodigious amount of digital transformation that is yet to come is staggering. It is predicted that in the next year and a half alone, the number of people online will jump from the current 3.6 billion to 5.8 billion, and most of this will happen through mobile devices. This is 1/3 of the world’s population going online for the first time in 18-24 months. Add to this approximately 50 billion machines that will continuously exchange information with each other over the same network by 2030.

For businesses, the environment created by this massive shift means that the most valuable companies for some time will remain those that lead the reorganization of existing assets and experience related to the flow of digital information. The two most famous Silicon Valley startups, Uber (worth $62 billion at the time of writing this article) and AirBnB (worth $25 billion), are exactly the types of companies I have in mind. Neither of them actually produces an asset whose services or utility they trade, but both provide a new flow of information that allows individual agents (people with smartphones) to react in a new way to the location of these assets in real time. User interaction en masse leads to the emergence of new behaviors and new markets built on them.

For heavy and specialized industries, changing the business concept may go in other ways, taking into account the peculiarities of their technological base. For example, through the expansion of additive manufacturing approaches. It is extremely important to have not only significant, specialized physical assets, but also deep knowledge about their production and operation. If you look at history, we have already faced similar periods of information instability, although not with the same scale and speed as the last two or three decades. The flood of information thrown out of European monasteries as a result of the relatively sudden rediscovery and translation of classical literature ignited the Renaissance. In the 19th century, the global economy spontaneously reorganized around new information flows generated by mass print literacy and the ability of information to move as fast as steamships, railways and telegraphs. The result was a century-long transition from monarchy to democracy, increased recognition of the rights of women and minorities, an end to the global slave trade and an explosion of technological innovation. The Internet of Things (the industrial Internet, as GE calls it) is the printing press of our time. It interweaves the flow of digital information with the physical world and promises to equip the physical world with adaptive emergent abilities that we observe in ants, neurons and digital systems.

There are those who see in the growing complexity of our connected machines the seeds of some future threat, but the global “nervous system” of culture is growing, using new technologies, and we are developing new relationships with it. We cannot stop development, but we can be aware of its consequences and possibilities. This is a frightening prospect, but at the same time it holds great potential.

Footnotes

1. Three figures made a significant contribution to the development of the economy: Adam Smith (1723-1790), Karl Marx (1818-1883) and John Maynard Keynes (1883-1946).
Adam Smith conducted a deep analysis of the world of business relations and came to the conclusion that every person in society acts in his own interests and can produce and buy goods and services that he needs. Smith called this mechanism of self-regulation the invisible hand of the market. It turns out a free market economy in action. Smith based classical economics on this conclusion. The main idea of classical economics is that the government’s attitude to the market is based on the principles of justice and allows the invisible hand of the market to guide everyone in their economic aspirations, create the greatest benefit for the greatest number of people and thereby stimulate economic growth.
Karl Marx looked at capitalism from a pessimistic point of view. Under the free market, Marx saw instability, struggle and decline. Marx believed that when a capitalist (a person with money and organizational abilities) creates the means of production, the value of goods is formed through the labor of oppressed workers. In his work Capital, Marx stated that the capitalist makes a profit through the exploitation of labor, without additional payments to labor for the value it produces. Marx considered the exploitation of labor to be the foundation of the class struggle and the foundation of capitalism, but he also argued that exploitation could be the death of capitalism. The economist was sure that as enterprises increase, the division and struggle will intensify.
During the Great Depression in the United States, millions of people lost their savings and jobs, the unemployment rate reached 25%. No one understood how the country could get out of the depression, many began to doubt the invisible hand of Adam Smith’s market and considered that time the end of capitalism. John Keynes suggested a way out: the government should start spending money on the private sector to restore demand for goods and services. President Franklin Roosevelt tried to put this theory into practice and launched a large-scale program of public works. However, at the same time, the United States entered World War II, which is why the production of weapons has grown to the highest level, and the experiment has ceased to be clean. Therefore, it is still impossible to say unequivocally what influenced the US exit from the Great Depression.

2. See Corning, Peter (2002), «The Re-Emergence of „Emergence“: A Venerable Concept in Search of a Theory», Complexity, 7 (6): 18-30; Campbell, Neil, and Jane B. Reece. Biology. 6th ed. San Francisco: Benjamin Cummings, 2002;
Anderson, Philip W. (2018-03-09). Basic Notions Of Condensed Matter Physics. CRC Press;
Girvin Steven M., Yang Kun. Modern Condensed Matter Physics. — Cambridge University Press, 2019-02-28;
Luhmann, N. (1995). Social systems. Stanford: Stanford University Press;
Arthur, W. Brian. (2015). Complexity and the economy. Science. 284. Oxford. pp. 107-9;
Smith, Reginald D. (2008), «The Dynamics of Internet Traffic: Self-Similarity, Self-Organization, and Complex Phenomena», Advances in Complex Systems, 14 (6): 905—907;
Valentin Robu, Harry Halpin, Hana Shepherd. Emergence of consensus and shared vocabularies in collaborative tagging systems, ACM Transactions on the Web (TWEB), Vol. 3(4), article 14, ACM Press, September 2009;
Etc.

3. See Steven Berlin Johnson. Emergence: The Connected Lives of Ants, Brains, Cities, and Software. 2001

4. See Frans de Waal. Are We Smart Enough to Know How Smart Animals Are?, 2016; Animal Social Complexity: Intelligence, Culture, and Individualized Societies, Edited with Peter L. Tyack. Cambridge: Harvard University Press, 2003; Tree of Origin: What Primate Behavior Can Tell Us about Human Social Evolution, Harvard University Press, 2001.

5. See the journal “Annals” — the historical scientific journal of the Higher School of Social Sciences of France, founded in 1929 by French historians Marc Block (1886-1944) and Lucien Fevre (1878-1956) (then professors of the University of Strasbourg). The publication in English has been carried out since 2012 and contains translations into English of the original French articles. In 2017, the journal formed a partnership with Cambridge University Press to publish both French and English editions of the journal\\http://annales.ehess.fr/index.php?228

6. See Shell M. Money, Language, and Thought: Literary and Philosophical Economies from the Medieval to the Modern Era. Berkeley: University of California Press, 1982.

7. See for example Karl Marx. On the Criticism of Political Economy. 1857; Capital vol. 1-4. 1867-1910

8. Lippmann W. Public opinion. N.Y, 1922

9. Allport G. The nature of prejudice. N.Y., 1958

10. Quasthoff U. Etnozentrische Verarbeitung von Informationen: Zur Ambivalenz der Funktionen von Stereotypen in der Interkulturellen Kommunikation // Wie verstehen wir Fremde? Aspe- kte zur Klaerung von Verstehen prozessen / Hrsg. P. Matusch. München, 1989

11. Bergier R., Six B. Stereotype und Vorurteile // Handbuch der Sozialpsychologie (2. Halb- band) / Hrsg. von C.F. Graumann. Göttingen, 1972

12. For more information about the activities of scientists, see https://www.newyorker.com/books/page-turner/the-two-friends-who-changed-how-we-think-about-how-we-think, https://www.vanityfair.com/news/2016/11/decision-science-daniel-kahneman-amos-tversky. Daniel Kahneman received the Nobel Prize in Economics in 2002 for studying human behavior in conditions of uncertainty and for research on how our brain deceives us.

13. See, for example, Baron, J. (2000). Thinking and deciding (3d. edition). New York: Cambridge University Press;
Bishop, Michael A & Trout, J.D. (2004). Epistemology and the Psychology of Human Judgment. New York: Oxford University Press;
Greenwald, A. (1980). «The Totalitarian Ego: Fabrication and Revision of Personal History» American Psychologist, Vol. 35, No. 7;
Kahneman, D., Slovic, P. & Tversky, A. (Eds.) (1982). Judgment under Uncertainty: Heuristics and Biases. Cambridge, UK: Cambridge University Press;
Judgment under Uncertainty: Heuristics and Biases / Daniel Kahneman, et al. — 21st. — Cambridge University Press, 2005. — 555 p;
Kahneman, Daniel, Jack L. Knetsch, and Richard H. Thaler. (1991). «Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias». The Journal of Economic Perspectives 5(1):193-206.

14. See in his book The Selfish Gene. 1976

15. Kirk G.S., Raven J.E. The presocratic philosophers. A critical history with a selection of texts. — Cambridge, 1971. — P. 182

16. https://www.britannica.com/biography/Edward-O-Wilson