Author Archives: Oren Litwin

And So It Begins—Camp NaNo, That Is

03 Friday Aug 2012

Posted by in NaNoWriMo, Writing

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Here I go again. It’s August, and that means that I’m indulging in more NaNo goodness. Yes, it is time for another round of Camp Nanowrimo, where a plucky community of writing addicts try to write 50,000 words in the space of a single month. As always, quality takes a distant second place to quality: the point of the exercise is to get words on paper (or realistically, on hard drives) and not to let your inner critic strangle them in the crib. Once the words exist, they can be edited; after all, that is the essence of good writing anyway.

This month, I’ve got an awesome group of “cabin-mates,” and they’re definitely making this a more fun experience. Special mention goes to Kimtsan, who I think is singlehandedly carrying the group forward.

I hope that this month will provide another supercharge to my writing; and perhaps it can generate some fodder for this blog. Stay tuned…

Standing, and Other Ideas for Promoting Public Health

25 Wednesday Jul 2012

Posted by in Health

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If you’ve been reading the internet at all in the last year or so, you’ll probably have noticed the sudden spate of articles and research studies about the perils of sitting down too long at a stretch. In a nutshell, our bodies were designed to be active; sitting down in one place for hours at a time, as most of us do for work or play, causes a whole range of ill effects, such as increased cholesterol, weight gain, changes in gene expression, poor circulation, and all sorts of goodies.

Since my focus for this blog is in restructuring your environment to make the world better, I’m most interested here in what you can do to change your situation so you can stand up more often. The most drastic change most of us can make is switching to a standing desk. That way, you can get your work done while also strengthening your back and circulation. (Needless to say, Talmud students have been way ahead of us.) It may sound like a lot of work to change your whole desk setup, but the health benefits are profound. (This has been widely discussed in the blogosphere, with examples here, here, and here.)

Sadly, I do not have a standing desk myself; I’m not ready to lay out the cash for one. Nor do I have the next step down, which is to use a therapy-ball chair like this one (blog discussions here, here, and here, for starters). It’s not exactly standing, but it engages your core muscles and your legs so it’s nearly as good.

Still, people looking for a quicker fix, without disrupting their workspaces or shelling out cash, may want to just focus on standing up at least once an hour, and taking a single step away from your chair (or more than one). Fortunately, there’s been an explosion of free productivity software that you can use to remind yourself to stand up every so often. I use a Mac computer, and my favorite software for this is called Time Out Free. At programmable intervals, Time Out will gray out your screen so that you can’t click on anything until the timer runs out. You are supposed to use that time to look up from the computer, stretch, or even take a ten-minute break to recharge.

This is one of my favorite health aids ever, because it is so easy to use. It’s free, and you can skip a given break if you want to. (You can also keep using keyboard commands even during the breaks, so long as you don’t click with the mouse.) So there’s no rigid constraints you have to obey, just a self-imposed structure to remind you to take care of yourself.

Some experimentation will be necessary to see what works best for you. The default settings are to have a ten-minute break every hour, with short breaks every ten minutes or so, which I found too disruptive. For a long time, the Time Out software languished on my hard drive, unused. Once I was clued into the benefits of standing, I remembered Time Out and reprogrammed it so that now I get 20-second breaks every half hour, and 20-minute breaks every two hours. This works for me, and it feels really good to stand up and stretch out my back when I’ve been working hard. I’ve noticed that I feel more alert and energized since I started doing this as well.

And now, permit me a short digression into current politics (not normally a focus of this blog). It’s exciting that a lot of people are getting into this whole topic; still, we need more. Especially since our health care system is increasingly funded with government money, the truth is that our personal health is now a public matter. Therefore, it seems obvious that the government should be mandating that employers take steps to get their workers to stand up more. Considering the dramatic health benefits, such measures as public subsidies for standing desks should be reasonable. On the flip side, there would have to be penalties of some kind for companies that insist on being somnolent and sedentary, instead of standing up as good citizens should.

Of course, it is true that some industries have an easier time getting their workers to stand up than others. Indeed, it may be quite burdensome to make some types of workers stand up more (including, of course, the disabled). But an easy way to solve that problem is with a cap-and-trade system, whereby some firms can make dramatic improvements in their sitting-to-standing ratio, and sell “Chair Credits” to other firms having more trouble. One can even imagine having public markets, where investment banks can facilitate the trade of such Chair Credits between companies. The advantages of this approach should be intuitively obvious to the most casual observer.

Fortunately, and in all seriousness, we needn’t wait for anyone to impose behavioral changes on us. All we have to do is put a little effort into restructuring our environment, so that actually developing a standing habit can happen without effort. That way, we can conserve our precious stores of willpower and use them for other things, even as we enjoy our improving health.

Random Fiction Excerpt #4

16 Monday Jul 2012

Posted by in Politics, Self-Promotion, Writing

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Bruce Leggett leaned forward intently, placing his hand on the other man’s shoulder. “So, Dave, can I have your vote?”

His neighbor Dave Crenshaw grinned. “Heck, Bruce, you don’t have to give me the whole song and dance. I know you’re a good guy.” He took out his smart phone and fiddled with it, logging into the centralized electronic voting portal. “I’m your man, Bruce.”

“Great,” Bruce replied, with a blinding grin of his own. He held up a piece of paper with his personalized bar code, and Dave snapped a photo with his phone. Within seconds, Bruce Leggett had been appointed as Dave Crenshaw’s official representative in the Voters’ House, and Dave’s vote transferred to Bruce’s control. That made a total of 73 votes for Bruce. When he voted on new laws, Bruce spoke with the voice of the people.

[UPDATE May 1, 2013: This excerpt is from an early draft of the short story “The Suffrages of the People Being More Free,” which is now published in a collection The Best Congress Money Can Buy: Stories of Political Possibility. You can read the first story for free here, and then buy it if you like. Enjoy!]

Random Fiction Excerpt #3

08 Sunday Jul 2012

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“Have you thought about how you will make your way in the world, child?”

Rafaela frowned. “I thought I would be like you, mistress,” she said. “Traveling around and healing people.”

“With your skill at healing?” Carlisa burst out laughing; a red flush rose in Rafaela’s cheeks. “No, child,” the sorceress continued, still chuckling. “You seem to be better at breaking things than putting them back together.”

“Well then, what? And stop calling me child,” Rafaela burst out suddenly. “I’m almost seventeen. I’m a full woman! I am your student, your servant even,” and oh how it rankled her to say the word servant, but she managed to spit it out without changing her tone, “but I am not a child!”

Carlisa sighed, an amused look on her face. “And how old do you think I am?” The question brought Rafaela up short; she started to stammer something, but the sorceress held up her hand. “Never mind. It’s not polite to guess at a woman’s age, mage or no. But believe me when I say that compared to me, you will be a child for years yet.”

Writing Interesting Characters with Transactional Analysis

02 Monday Jul 2012

Posted by in Better Fantasy, Self-Actualization, Writing

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By now, every aspiring author has been thoroughly brainwashed that to write a good story, you need strong characters. When you browse the web for resources on writing, you will commonly come across all sorts of checklists or creation tools for developing detailed characters. (Examples are all over the place, but some good ones can be found here, here, and here.) But I’ve noticed something interesting about 99% of these checklists: they focus on a given character, in isolation.

Yet think about yourself for a second. At all times, do you behave the same way? Or do you evince different behaviors, different emotions, different patterns of interaction depending on who you are with? I know that I behave very differently when I’m around my parents than I do when I’m around my professors, or my brother, or my friends in the community. Each of those patterns of behavior comes from a part of me, to be sure, but they are so different from each other that a single global “character sheet” would be unlikely to capture all of them.

Yet very often, we find fictional characters who always behave the same, because their authors seem to think that the characters must at all times be displaying their Traits with a capital T. There’s nothing particularly bad about this, when done well; character archetypes are a staple of mythic stories from time immemorial. But as writers we can expand our toolchest if we remember that people often act out different personas in their different relationships.

Fortunately, there is a tool we can use to make such characters. It is a heterodox brand of psychology called transactional analysis, first introduced by Eric Berne in his excellent 1964 book Games People Play. This book introduced a number of terms that have diffused into common speech, such as “stroking someone’s ego,” and so is interesting if only from a sociological standpoint. But beyond that, it provides a powerful lens for understanding how people might change depending on who they are with.

Briefly, Berne argued that people’s childhood experiences leave them with certain psychic needs that must be met, by subconsciously seeking out certain types of relationships that confirm preexisting beliefs about the world and one’s place in it. Think of the woman constantly complaining that all the guys she dates are losers, or the man who can’t hold down a job for more than a few months before lashing out at his boss. Berne provides examples of “games,” or scenarios that the multiple players in a relationship enact in order to fulfill their psychic needs.

For example, in “Why don’t you… Yes, But,” person A presents some problem that he or she is dealing with (“People annoy me at work,” for example), and persons B through Z then list off a series of solutions. “Why don’t you ask for a raise?” “Why don’t you wear earphones?” And so on. To each of these suggestions,  person A responds with an endless litany of excuses for why the solution could not possibly work. However frustrating and pointless the exercise might feel to an outsider, the participants are on some level satisfied. Person A gets to combine the illusion that he or she is trying to fix the problem with the true goal of the game, “confirming” that the problem cannot be solved and so no attempt need be made. The others get to feel as if they are being helpful, i.e. superior. And so it goes on and on.

Other games can be found in the book or summarized in the Wikipedia article. Some good ones include “I’ve Got You Now, You Son of a B****,” “Look What You Made Me Do,” “If It Weren’t For You,” and “Look How Hard I Tried.” The point is that these are recurring pathological types of relationships between two or more people, which meet the unspoken and perhaps unconscious needs of the players thanks to various kinds of emotional harm that has marked their personalities.

I should note here that I am not a psychologist, and am not necessarily advocating the use of transactional analysis for therapeutic purposes. It may work for you or people you know, or it may not. Additionally, modern TA has gone off in several different directions, so Berne’s book should not be relied upon as the last word. Still, I am focused here on TA’s relevance for writing fiction, and for that it can be quite valuable.

How can you use this technique? Remember when writing your characters to consider how they interact with each other. Grunthor the Merciless might be gruff and unsympathetic to Lewellyn the Delicate, but be a devoted kind husband to Helga the Bonecrusher. The same person, acting out different patterns of relationships, based on how his particular impulses line up with those of the other person.

Still, there is a unifying thread between all of a person’s relationships, and that is the psychic needs of the person. Explaining this in detail would take me far afield; but suffice to say that this can provide the continuity between all of a character’s different interactions, allowing you to build a larger theme around each character’s relationships.

In short, think of your characters together, and not just alone.

An Idea for How to Make Renting Homes Better

01 Sunday Jul 2012

Posted by in Credit, Economics, Finance, Investing, Real Estate

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Many fortunes are made in real estate. And, lured by those stories of success, lots of people have tried their hand at real-estate investing as well, with highly variable results. Meanwhile, many people who cannot buy homes of their own decide to rent instead.

But the present rental market has a lot of flaws in its structure. Take, for example, a common strategy used by new investors who don’t want to sink a lot of capital into a house. They will instead rent a place, perhaps for a long term to bring down their monthly rent, and then turn around and sublet it out to someone else for a higher price.

Now, these people are certainly providing a service of some kind. They are providing income to the owner of the property; if they chose a longer rental term, they are also providing a guarantee of long-term occupancy. But the eventual renter is paying a higher rate for his home than the owner is receiving. It’s possible that the renter has low credit and would not otherwise qualify, or perhaps would not have heard about the apartment without the marketing efforts of the investor-renter; but still, it seems that there ought to be more opportunities for mutual benefit.

One thing that’s always struck me about renting is that most landlords do not allow you to prepay your rent. There are good legal reasons for this, but it still seems to be a missed opportunity. The typical landlord carries a mortgage with an interest rate of more than 5%, sometimes much more. By contrast, 10-year Treasury notes are yielding around 1.6%. If a renter could sink extra cash into prepaying rent, with an annualized discount of (let’s say) 3%, and the landlord used the extra cashflow to pay down the mortgage, it would benefit both sides. All that is necessary is to create the appropriate legal structure.

When you think about the components of a property’s value, you could break it down into two parts: the right to live in a place for a given time, and the actual ownership of the property. Suppose you actually broke them into separate pieces. For example, I could have a house I wanted to rent out, but I wasn’t interested in collecting a rent check every month. Instead, I created a product: the right to live in my house for ten years. I then assigned that product a value, just like a piece of real estate. Say the house itself is worth $100,000; I then value ten years of use at, say, $40,000. If I find a buyer, I can get all that cash upfront and not have to worry about collecting rent every month. At the end of the term, I still own the house and can benefit from its price appreciation, tax depreciation, and so on.

Now suppose I’m a renter, or investor-renter. Buying a ten-year lease gives me a discounted price, compared to having to pay for it month by month. It also lets me lock in the price for the entire term, giving me stability. Plus, since I don’t actually own the house, I don’t have to worry about property taxes. But how might I come up with all that cash up front? If this becomes the norm, it ought to be easy to borrow that money from the bank—especially when you consider that a ten-year rental term is an asset like property is, and can be used to sublet the house in turn, or repossessed by the bank if necessary.

It would be easier for a bank to repossess rental rights than a full property, meanwhile. At all times, there is an actual owner who is interested in maintaining the value of the property, as opposed to home foreclosures that often sit vacant and get trashed, destroying massive amounts of value. And it is easier to rent a property than to sell it, and lots of managers that the bank can call upon to fill up their newly-repossessed asset. Finally, it ought to be easier to appraise use-rights than the actual underlying property, making underwriting easier. So from the bank’s perspective, this might be an attractive asset class.

Subletting a rental-agreement house will provide more gains from trade, in this scenario. I, the investor-renter, have provided the benefits of upfront capital, allowing me to get a good price. I can then sublet to a traditional renter, who does not have to provide upfront capital but can still pay a price comparable to the going rate. I make money from the difference between my discounted upfront payment, and the month-by-month payments of the renter, without having to “overcharge” as subletting investors must do today.

This all will need fleshing out, of course. Navigating the legal minefields alone will be an effort, not one that I care to undertake right now, and people would have to work out the practical problems involved with any new asset class. And this kind of structure will not be appropriate in many cases. Still, its mere existence would cause ripple effects out into the market that would benefit everyone. And perhaps someone more enterprising can see this idea and make use of it.

The Social Effects of Weapon Technology (and How to Use in Writing)

22 Friday Jun 2012

Posted by in Better Fantasy, History, Military, Politics, State Formation, War, Weapons, Writing

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Mao said that power flows from the barrel of a gun.  He also said (and this is less remembered) that therefore, the Party must control the gun, and the gun must not control the Party. In other words, the brute facts of violence are important, but so are the social arrangements that control them.

This has been true throughout most of history. Whoever has control of violence will tend to gain political power. In several times and places, the military did not actually rule, but submitted to a legitimate authority—the United States is a decent example of this, or most the the European powers in the last few decades. But more frequently, those with the means of violence make the rules. Recent events in Egypt and elsewhere bear this out, as if we needed more examples.

That said, it makes a huge difference what the state of military technology is. For that will determine if weapons are available to the mass of people, or if they are restricted to only an elite few. Samuel Finer argued that his monumental History of Government (now out of print, and sadly hard to get—inexcusable on the part of Oxford Press in this time of print-on-demand!) that when weapons were widely available, politics tended to feature mass participation and broad egalitarianism, if not outright democracy as in the case of ancient Greek city-states and their hoplites. (Or, one might add, early America.)

On the other hand, when specialized weapons gave advantages to those wealthy enough to afford them, power tended to be concentrated in the hands of a few. For example, the rise of powerful kings in Europe had much to do with the advent of cannon—fantastically expensive to make, requiring a large specialized infrastructure of foundries. Furthermore, with cannon French kings were able to reduce the fortresses of their rebellious nobles, consolidating their own power.

In an earlier age, the armored knight was the undisputed master of the battleground, able to crush unarmored opponents with ease. Thus, power tended to be held by the armored warlords of the feudal era, whose rule depended on their use of naked force. Then the free Swiss militias developed their famous style of pike warfare, which completely nullified the advantages of the knight.

So weapons technology played a large role in politics. When considering a given era, we must ask: how common are weapons? Are they easy to use, or do they require specialized training? Do the wealthy gain any particular advantage from their wealth, or can mass armies defeat them?

This line of argument is one of the bases of the American gun-rights movement (examples can be found here, here, or here, but there are many others). It was also argued by Max Weber that the rise of the Israelite kings (over a previously egalitarian society) was the result of advanced armor, which gave a significant battlefield advantage to those wealthy enough to buy such armor.

This reasoning can also help explain the rise of child soldiers. P.W. Singer argues that child soldiers are now more feasible because small arms are becoming more advanced and lighter. Children can now use weapons effectively on the battlefield in spite of their small size and physical weakness, which has not been true for hundreds of years if ever. As a result, child soldiers are becoming a frequent sight in war-torn areas, since it is relatively easy for a brutal would-be warlord to coerce children into fighting for him (or her, I suppose).

Similar issues are beginning to arise because of drone technology. Robots have often been used for fun by hobbyists; but it is only a matter of time before these can be weaponized, and made available off the shelf. Governments will be unable to stop the spread of drone weapons into the general populace, and the social effects of this shift are likely to be extreme.

******

So as a writer, how do you use this?

First of all, when you are world-building, be careful to compare the state of weapons technology with the social system. Kings and castles are unlikely when no one wears armor or carries swords, or if everyone does. Magic can also be a weapon, in this sense, so if powerful magic is rare, it should generally translate into considerable power (unless there are social reasons otherwise).

You can write an interesting story about social upheavals caused by changing technology. For example, I’m presently messing around with a story where magic previously relied on using decades-long mental training to draw sigils of power in your mind; but then someone figured out how to get the same effects with sigils carved into physical media, such as discs of wood, and then everything collapsed into chaos as weapons technology exploded into the populace.

A great example of this concept is in the early installments of the excellent webcomic Schlock Mercenary. A new means of transport allowing for functional teleportation is rapidly weaponized, and bombs are teleported into government offices across the galaxy. Chaos and war break out on hundreds of planets, and things only die down when scientists figure out how to block teleportation into protected areas.

I hope this piece proves useful. At any rate, it should be food for thought.

Tax Farming

17 Sunday Jun 2012

Posted by in Better Fantasy, Economics, Finance, History, Politics, State Formation, Writing

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April 15th is a date seared into the brains of most Americans—being the due date for us to turn in our tax returns to the Internal Revenue Service. In the modern era, most governments have wide-ranging powers to tax their populaces. Yes, you have problems with tax evasion here and there, but most urban dwellers are used to paying taxes as a matter of course (though we certainly aren’t happy about it).

When you think about it, though, the smooth collection of taxes requires a vast infrastructure of information processing, bureaucracy, and coercive enforcement if necessary. All of that came about very late in historical terms. In the United States, tax withholding from our salaries was only instituted during World War II, for example. (In a delicious bit of historical irony, the concept was developed in part by famed free-market economist Milton Friedman, when he worked for the Treasury in the early days of the war. For the rest of his life, he hoped that tax withholding would eventually be abolished.) The first income tax in the United States was a temporary measure enacted during the Civil War.

In other countries, the story was similar. The seminal work on this subject, at least in comparative politics, is Margaret Levi’s Of Rule and Revenue, a study of taxation systems throughout history. Levi’s basic argument is that rulers are constrained in how they can tax populations by their ability to coerce the people, the ease with which money can be hidden, and limitations in measuring technology. (I previously wrote of similar concerns behind the institution of English nobility.) In short, early rulers had a very hard time raising taxes directly, simply because it was next to impossible to extend their control over the populace.

So what did they do? The strategies of rulers were many, but in this piece I want to focus on a particular practice called “tax farming.” In its basic form, the ruler created some sort of tax or tariff—a 10% tax on salt, for example—but rather than collecting the taxes itself, the ruler would sell off the right to collect the tax to some private party. This was the tax farmer. The tax farmer would pay a large sum up front to the government, and in exchange would gain the right to ruthlessly apply the salt tax to anyone within his jurisdiction and pocket the proceeds.

This is not the same as modern privatized tax collection, where the private party must transmit collected taxes to the government. Here, the tax farmer is the direct beneficiary of tax revenue. In general, tax farming was incredibly lucrative for the farmer, while the state was forced to sell the future revenues at discount prices, simply because it lacked the capacity to collect taxes itself. (Here, we see another example of a principal-agent problem.)

A nice (free!) overview of tax farming in the 18th century can be found here, by the eminent scholar Eugene White. The French monarchy, for one, was heavily dependent on tax farming for revenue. This dependence was a major contributor to the French Revolution, for two reasons. First, royal revenues were always rather stunted because the tax farmers absorbed much of the take, weakening state power. Second, the tax farmers of France were notorious for harshly oppressing the populace in order to squeeze every last sou that they could. (Similar concerns were at play with the Publicans of ancient Rome; a nice overview can be found here.)

This is all very interesting, but why is it worth knowing? In fact, it is surprising just how relevant the principle of tax farming can be, even in modern society. Take casinos, for example. They pay a large sum of money to local and state governments, and in return gain the right to siphon vast amounts of money from willing gamblers. The voluntary nature of the transaction makes it more palatable, of course, but even then the addictive nature of gambling muddles things.

Even more striking is the history of the banking system. That subject is so fascinating that it deserves its own post, but for now, suffice it to say that for decades, many U.S. states raised nearly half of their revenue by selling monopoly banking charters. In return, a particular bank would be given exclusive control of its town, free to earn considerable profits from its residents.

Neither casinos nor early banks are really the same as tax farming, of course. But they are both indirect means of collecting revenue, in which private parties gain outsized profits compared to the government’s take. Other examples can be seen with only a little effort, and the idea of tax farming is a useful lens for viewing much government policy.

Aside from that, this is another opportunity to bang my hobby horse of more realistic fantasy writing. As noted, tax farming was often the cause of massive oppression of the people, and resulting political unrest. I’d bet my last cent that some budding fantasy author could spin a much more interesting story using tax farming as an ingredient, than the typical “Evil Overlord wants to oppress the peasants for the lulz.”

The key thing to remember is that a king turns to tax farming when he needs more money that he can easily extract with his own efforts. It is the hallmark of lands with difficult travel, poor communication, and weak and divided political loyalties. In time, the tax farmers can become extremely powerful in their own right, perhaps even rivaling the established authority in the same way that Italian mercenaries would often overthrow their employers. If that isn’t fertile soil for a good story, I don’t know what is.

Fantasy Fiction and Ideas for Writing Long Journeys

13 Wednesday Jun 2012

Posted by in Better Fantasy, State Formation, Writing

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I’ve said before that I’m not a stickler for realism in fantasy, per se; but neglecting how things actually worked has costs, because authors miss opportunities for more interesting stories. The long journey is a perfect example. Going back deep into the mists of time, epic heroes are expected to take long journeys. J.R.R. Tolkien codified the trope for modern fantasy writers, and now you can hardly swing a cat without hitting a dozen fantasy books wherein characters travel from one side of their world to the other. A few examples suffice: Terry Brooks and the Shannara series, the Wheel of Time, to a lesser extent George R. R. Martin’s Song of Ice and Fire.

The thing is that most of these depictions bear very little resemblance to how actual traveling tended to work in premodern societies. Again, that’s not necessarily a bad thing; if realism gets in the way of a good story, then by all means, let’s chuck it out! But understanding how transportation worked back in the day can help us create new stories, or put new twists on old stories.

The first thing to understand is that most societies do not keep track of distances between locations; they keep track of how long it takes to get there. This makes sense; it might be only a few miles from one side of a steep mountain to the other, but actually traveling that distance could take most of a day. On the other hand, two villages might be twenty miles apart from each other, but if the intervening space is a flat, grassy plain, then it would be a relatively easy journey of less than a day. Travel time becomes more important than distance as the crow flies—after all, we aren’t crows.

(James C. Scott, in his brilliant Art of Not Being Governed, notes that the upland societies he studied would describe distances in terms of units of time that are relevant to their situation. For example, you might say that a particular clearing is “three boilings of rice away.” Or, someone’s house might be “two cigarette smokings away.” In a society without clocks, such units of time make sense as well.)

Travel paths are guided by the contours of the land. This is particularly true for vehicles; the United States railroads, for example, were laid out where they were (along flat areas and valleys) because the heavy coal-freight cars could not climb up grades of more than a few degrees. In consequence, communities further up in the hills had no access to the railroad. Whereas American towns and cities had previously been spread across several kinds of terrain, once the railroad arrived population was inexorably sucked into the lowlands, where the new towns could access the national transportation network.

In the ancient world, the easiest and fastest way to travel anywhere was by water. This was especially the case when you had to transport a lot of cargo, such as grain. Scott writes that Chinese merchants transporting grain by ox-cart would only travel about 250 kilometers; any further than that, and the oxen would eat more grain than they carried. Charles Tilly notes that it was roughly as expensive to transport grain from one side of the Mediterranean to the other by ship, as it was to transport it across 100 miles on land. This had drastic effects; it was common for seaport warehouses to be filled to bursting with grain, while scarcely a few hundred miles away villages were starving.

It is no surprise that most cities are placed next to a river. Rivers were the highways of the premodern world. Roads on land were important too, but were typically a second-best choice. The greatest cities stood at junctions between rivers, where merchants needed to transfer from one river to the other, or between a river and the sea. Amsterdam is a classic example.

On well-traveled roads, you typically ran into a village every several hours of traveling. Often, these villages were little more than an inn and a trading post, meant specifically to cater to travelers. Conversely, in times of political upheaval, good roads meant an easy passage for marauding bandits; small villages tended to evaporate as their residents fled for defended cities, or up into the hills where they could escape danger.

Traveling cross-country was possible but unusual. There would be no guarantee of food or easy passage, and it was dangerous to go off the path. Wild animals, poisonous plants, treacherous footing, all gave ample reasons to stay in the well-trodden areas. There is a reason that African explorers carried machetes. Otherwise, you simply couldn’t make it through the jungle. The European forest was similarly impassible. Mountainous areas too were formidable obstacles; have you ever tried hiking up a mountain?

Now, how can you turn all of this into plot elements? First of all, I believe there’s not enough fantasy-traveling over water. (A good counterexample is Eric Flint’s and David Weber’s 1633, not surprising given the emphasis on military logistics.) To be sure, most fantasy stories will have the obligatory canoeing sequence, but it is usually a short sequence soon forgotten. But imagine if your main mode of transport were to go down the length of one river, and then make portage to the next one, and the next? There are possibilities there for new sorts of plot obstacles, hair-raising dangers, river pirates, and more. Plus, you get the benefits of land mere feet away from your boat, allowing detours off of the river and into untamed wilderness whenever the plot demands it.

Second, because travel tends to follow predictable paths, it makes ambush far more likely and realistic. This can work for and against the heroes. There’s no need for contrivance to make sure your heroes intercept the dastardly villain, when said villain can only pick one realistic path to travel on.

Third, a bit of research can help you depict just how hard it really is to go off the road. If our heroes need to avoid danger by leaving the main highways, why not emphasize how this makes them giant studs?

Finally, how many times have you skimmed over yet another paragraph describing the heroes’ journeys? With a little more realism, such passages can actually become interesting to read, precisely because they can be filled with unexpected details. For example: if it is so expensive to transport goods over land, what goods are being transported and why?

I hope that this post can help you restore a sense of size to your fantasy worlds. Again, I’m not asking for realism for its own sake; but use the ideas here to come up with new stories to tell, or new ways to tell them. Difficulties in travel impose constraints; how your characters overcome those constraints is a story, if you want to tell it.

Coordinated versus Liberal Market Economies

11 Monday Jun 2012

Posted by in Credit, Economics, Finance

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[Welcome! If you enjoy worldbuilding, check out my handbook for authors and game designers, Beyond Kings and Princesses: Governments for Worldbuilders.]

Capitalist economies (not the same thing as free-market economies, necessarily) depend on those with money providing capital to firms that need it. For most of human history, most actual investment was done by a small number of people, those with the skills and inclination to form relationships with businesses. Vast amounts of money was economically sterile, being hoarded as gold or silver treasures in the vault of some nobleman or other (just as today one might stuff hundred-dollar bills into a mattress). For the economy to grow and develop, somehow a mechanism needed to be set up to allow savings to be automatically channeled into investment.

This mechanism was the banks. When you deposit money in a bank account, the bank then turns around and lends it to someone who wishes to borrow. The bank serves as an intermediary between you, the saver who wants nothing more than a safe place to store your money (with maybe a little interest on top), and the borrower. Thus, savings that were previously useless to the economy are now being recirculated. (This can lead to systemic fragilities, of course, but those must wait for another post.)

Most bank-dominated systems work in a style called relationship banking. A company forms a long-term exclusive relationship with a bank, that will provide access to capital in exchange for a large degree of control over the company’s decisions—the bank wants to make sure that the company isn’t going to waste the money, after all. This sort of system relies on personal relationships and insider knowledge more than on things like a credit score, which only came into common use in the 1980s or so.

Some economies, such as those in much of Europe, take this logic even further and structure their entire economy around such long-term relationships between firms. Business contracts, decisions on who to hire and how to train them, and access to capital are all made through a close-knit network of powerful executives; insider knowledge and relationships are the key factors here. This is called a coordinated market economy, and you can read a fuller description of it in Hall and Soskice’s Varieties of Capitalism. (Amazon link here.)

Coordinated market economies have some advantages over the American/British system of comparatively liberal market economies. The system in general is more stable; you don’t get the day-to-day disruptions common in the US economy, for example, because everything is based on long-term relationships. In particular, new upstarts find it very difficult to break into such a system, because they can’t get access to capital and they can’t win contracts from existing businesses. While this may seem bad to the American ear, it has the advantage that firms in such an economy can specialize in extremely narrow niches of production, leading to incremental innovation. This is why German companies are known for their precision manufacturing, for example: because they have the luxury of intense specialization in their particular areas.

On the other hand, because it is so difficult for new firms to compete, a continuing hazard of such economies is that the whole system begins to stagnate. Disruptive innovations find it hard to survive in such systems, and instead gravitate to the more open liberal market economies like the United States.

In a liberal market economy, access to capital for big firms is usually gained via the public markets: the stock market and bond market. This means that the long-term relationships typical of Continental economies are less important here. Instead, decisions about who to invest in are driven by the release of public data, for example in annual reports or tax filings. Using such data, market participants decide who to channel their capital to.

There are drawbacks to this system. Particularly in the last thirty years, company executives can be driven to chase quarterly targets at the expense of long-term viability. The business environment is volatile and always changing, making it extremely difficult to plot long-term strategy and to pursue incremental improvement.

On the other hand, this system is much more hospitable to disruptive innovation, as we can see just in the last decade or two. While it can be gut-wrenching while you’re in the middle of it, overall it leads to a more dynamic and healthy economic system over time; stagnation is less of a threat here.

The main difference between these two systems is in the ability to get investment capital without sucking up to a bank. From that relatively minor difference, massive differences in total economic structure can develop. (More details in the Hall/Soskice link.)

Again, institutions matter. And seemingly small differences in institutions can lead to major differences in outcomes.