Economics is a study that is of course concerned with how resources are allocated in a society. There are many different “theories of value”, such as the well-known marginal utility theory, subjective value theory, labor theory of value, and less well-known ones, such as neo-Ricardian theory of value and energy theory of value. The latter two seem to me the most plausible, postulating that energy invested into resources forms a “long-run price”, or “price fulcrum”, around which the price fluctuates in the short term due to factors described by other theories, such as subjective value. These all seek to explain prices, which by most are viewed as the only viable method of economic calculation. In order to compare heterogeneous goods, relate utility to capital, and plan allocation coherently (there are other criteria that I’ve omitted since they are begging the question, e.g. “well functioning financial markets”), we must use prices, because there’s simply no other way to determine who gets what.
I would like you to take note, however, that there is a critical part of this problem that is overlooked: Markets determine what gets produced, by determining who gets what. It does so using the rationing function of money, which weights subjective preferences based on ability to acquire money, and therefore the preferences of those with more wealth are expressed more strongly. This is a receiver system of value (RSV), which controls allocation via the receiver’s perceived value of the resource. RSVs have several critical problems under several current economic conditions, most notably strong inequality, constrained natural resources, an excess of capital, the rise of automation, and the widespread use of electronic networks. It is for this reason that we are currently seeing starvation (in both the literal and computational sense), overexploitation of natural resources, a glut of advertising and unwanted products, un[der]employment, and low sharing of information.
A donor system of value (DSV), on the other hand, determines value by the investment put in to the resource. Emergy analysis (EMA) is a DSV that is more than capable of determining the costs of production. In doing so, the most sensible way to use EMA is to stay within the naturally-defined budget of our planetary boundaries. It would be childish and nonsensical to argue that we, as a species, should threaten our own existence so that a few people can have 20 mansions and 50 luxury cars all to themselves. While an RSV must be based on exchange, or bi-directional flow, a DSV allows for unidirectional flow, which greatly increases the flexibility of the resulting system.
In fact, a DSV is based on the premise that an individual contributes very little to the flow of energy and resources compared to solar, tidal, and geological processes. The idea that we must have a quid pro quo exchange with a person just because they contributed a little to a resource runs up against the fact that we only take from the Earth system, without giving back much of anything. Using durable products as services, rather than exchanging them as commodities, we increase the utilization of each, while reducing the number of copies needed. They can be allocated using queuing theory methods and either hypothesis testing or bayesian methods (I will admit I have not studied bayesian methods enough).
There is still the problem of resolving conflicts for resources when requests exceed the budget. This can be accomplished using a priority queue and a technique I will call “slack ordinal sorting” (SOS), which fits into a more general framework I call priority theory of value (PTV). Slack ordinal sorting quantizes products qualitatively first into classes (e.g. 300mL cup, single-engine turboprop plane, 1MW windmill, etc.), then into bins or priority levels (prios; my definition uses the module [rt,-20,…,-1,0,1,…120]). Some of the products that will be requested, such as food and water, are unequivocally necessary for survival and should be placed in a special prio (rt, realtime) that does not subject the customer to a lead time and automatically creates an emergency stockpile according to supply risk assessment. The capital required to produce these resources should be placed at a proportionally high prio to ensure that needed infrastructure expansions happen quickly. For others, especially luxuries, the customer is subject to preemption, which proceeds in order of the requested resource’s prio. As an example, if the conflict was between a notebook and a pack of cigarettes, it’s likely the notebook will pre-empt the cigarettes, because a notebook is used to create (and thus it has many more forward dependencies) while cigarettes are inherently destructive (and should therefore have a low prio due to their hazard).
The key here is that economizing is done by the donor; We are free to choose the things we want, but we cannot exceed physical, objective constraints that we are free to (albeit temporarily) exceed under a price system. It may be argued that this system is not optimal, but I would respond that there is no optimal system, and if there is, it is certainly not, according to all evidence, capitalism. I hypothesize that a DSV will create a strong personal and social incentive toward conservation, and highly efficient design, in order to stretch our budget further. I also conjecture that long-run growth will look like a singularity for capitalist societies, while DSV-based societies will grow logistically. A society based on NE principles will reach a critical point where it begins to grow very quickly, until it approaches its budget ceiling, where it will then innovate and reallocate in order to continue the slow/no growth trend after the second critical point.
Note, there is no central planner. There are multiple planning agents, and a distributed control system. This is a self-organizing system of different trophic levels of energy metabolism, much like the natural Earth system is. Hardcore capitalists argue their system is the only one that makes sense due to the evolutionary justification of competition; I argue that this system makes more sense due to observation of the actual function of resilient ecological systems. Some may argue that this is a restrictive or controlling system, but it certainly isn’t the case that it’s more restrictive or controlling than one which locks up all resources and demands a return for them. It will surely not be designed such that a starving person is denied food, or a homeless person is denied shelter. Nor will it be designed such that the fruits of our labor go primarily to someone whose name is on the documents but did not necessarily contribute anything.