Steve KelseyA physics based economic model starts with a physical definition of wealth.
Wealth is the product of applying intelligence to base matter. This process raises base matter to a level of functionality that satisfies a need. Clay becomes brick, bricks build cities. Iron oxide becomes steel, the steel becomes machines. Our civilisation is based on trillions of transformations of this type.
We cannot measure intelligence as a physical effect, but we can measure the amount of intelligently directed energy employed to embed intelligence in base matter.
We can therefore define wealth in physical terms using
M = mass (kg)
E = energy (joules)
Where M defines the quantity of base matter, we will use 1 kg as a standard measure, and E defines the amount of intelligently directed energy employed to transform the kilogram of base matter.
Hence W = M x E defines wealth in physical terms .
For example, 1 kg of brick contains far less intelligence than 1 kg of CPU’s and this is reflected in the energy employed in converting base matter into these components of civilisational wealth. It takes 1,954 Kilojoules to make a kilogram of brick compared to between 1,000,000 and 100,000,000 Kilojoules per kilogram of CPU. A kilogram of CPU contains 500X the amount of intelligently directed energy of a brick.
We can define the intelligently directed energy applied to base matter as Applied Energy and this will produce a useful analogy for the amount of intelligence applied to base matter in a physically meaningful way.
We can take a further logical step and define the amount of intelligently directed energy applied to a kilogram of base matter as the Applied Energy Density. For example, the applied energy density of a kilogram of bricks is much lower than a kilo of ICUs.
Summary:
- Wealth is the product of intelligence applied to base matter.
- Intelligence is applied to base matter by the intelligently directed application of energy
- This energy has a physical reality that can be measured.