Two DCIT Scenarios

by Juan

2 minutes • 241 words

Table of contents

Hunter-Gatherer Scenario
Advancing Society Scenario

Hunter-Gatherer Scenario

DCIT hunter society — Figure 1. A single hunter who consumes all the work of his industry

This scenario illustrates the DCIT model in the simplest form without trade. To meet the hunger (demand) of the hunter, he must gather his equipment and skill (capital) to hunt an animal (industry), which he will consume to satisfy his hunger.

Advancing Society Scenario

DCIT advanced society — Figure 2. A simple scenario illustrating how societies get wealthier through time

It starts with fixed capital (light blue bar), unlike the hunter-gatherer scenario which had none. The circulating capitals are then added:

new skills, new equipment, division of labor, etc are represented by the light green bar
labor, raw materials, finished products, money are the dark blue bar

The light green bar on slide 14 represents value that is in excess of what is needed to maintain fixed capital.

Every economy, regardless of paradigm, has the factors of demand, value (capital with industry), and trade which are balanced and spread naturally by human action. The more freedom and justice a society has, the faster the spread and balancing is, reflecting human dynamism. The lesser both are, the more barbaric the balancing becomes, unearthing the instincts of our animalistic past.

In Capitalist systems, excesses are balanced by crashes while shortages are balanced by demonstrations and riots. In authoritarian or Communist systems where freedom is almost non-existent, excesses are balanced by stagnation while shortages are balanced by revolution, civil war, or an exodus.