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One of the reoccurring concepts in my worldbuilding has been the existence of a caste based meritocracy. The castes being Guardians, Engineers, Scholars, Administrators, Artisans/merchants.

While brainstorming an idea came to me: What if people in this society were not paid in cash but in some manor of redeemable acknowledgement of their contribution and value to society. Something like the whuffie, only tied to one’s societal contribution instead of to popularity as in a reputation-based economy.

It would be awarded by the state at regular intervals based upon a citizen’s performance of their duties. Aside from that I haven’t a clue how this might work, if it could work at all.

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    $\begingroup$ Let every citizen of your economy register on Stack Exchange and let the public rate their contributions, they will be paid in reputation and badges! $\endgroup$ – Hightower Feb 26 '15 at 20:58
  • $\begingroup$ How is this money (redeemable acknowledgement of contribution) distributed - as in who actually hands it out or decides how much to give out? Basing this on a person's contribution to society presupposes an objective quantitative measure of the value of that contribution - by whose measure? Without an objective measure, this is purely a measure of popularity or conformity to group. $\endgroup$ – pluckedkiwi Feb 26 '15 at 20:59
  • $\begingroup$ @pluckedkiwi As this society is quite statist in nature. The people are paid/awarded by the state. every job with in each of the castes has something equivalent to a pay-grade. A citizens performance is contently tracked and evaluated that is how their contribution is measured. As for how it's spent they simply take talent-card to a merchant caste outlet and procure what they want and need. $\endgroup$ – Trismegistus Feb 26 '15 at 21:22
  • $\begingroup$ you may want to look at David Graeber Debt for some sorta-kinde moneyless economies that worked for while. Also you could aks at the sister SE for history if something resembling a meritocracy has ever existed (my hunch is no, but I could be wrong). $\endgroup$ – mart Feb 26 '15 at 22:35
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    $\begingroup$ Those who decide how contributions are allocated will find that their job is the most valuable of all. $\endgroup$ – Oldcat Feb 27 '15 at 0:17
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The Way It's Supposed To Be Working Now

We live in a society that is supposed to be a meritocracy - rewarding those who work hard with better paying jobs. The issue here is that those wo already have better-paying jobs can pay for their children to get better paying jobs from the start, without earning it through merit. The means by which we reward merit becomes the means by which merit is rewarded.

Ideally, every society should work such that those who work harder are rewarded for their hard work, but the exchange of any type of currency or thing of value throws that out of balance, because someone who stockpiles that which is valued, or 'games' the system to earn the most of those things regardless of the value of their work, is working to break the system as it is meant to function.

Arbitration

One way this could be prevented is by selecting people to arbitrate what tasks are of real value, and handing out either the means to redeem that work, or the products that are due to that work as they see fit. In smaller societies, this can work quite well as we've seen in the past with Native American societies being ruled by a Chieftan who would distribute to the tribe that which is needed.

In larger societies, it tends to fall apart. A single leader cannot organize a large society on their own, so they must appoint delegates to run smaller sections of society. They then delegate their own delegates, and so on and so forth. A single deligate who is corrupted can then spoil what is supposed to be a fair and equitable society.

Not An Economy

What about a world where we don't have an economy at all? A post-scarcity society that doesn't have to concern itself with the distribution of vital goods? Under an ideal situation, all of life's necessities would be provided for, and luxury items would be the only thing separating individuals by wealth, which could be made trivially in any case.

But as I said, this would be an ideal, and runs into many problems - how would society provide goods to everyone? How would they be distributed along a large and complex set of political boundaries? How would society ensure that no individual is bereft of their basic needs? How would luxuries be distributed? Would there even be a need for work if this distribution is perfect?

Answering these questions is the exercise of writing a utopian work of fiction, or sometimes a dystopian work of fiction if society hasn't solved these problems. We're still working on the problems ourselves, so barring technology that eliminates scarcity, that can distribute needed goods to all of humanity's individual peoples, and that does not disproportionately distribute luxury good to some while others are left wanting, we will be stuck dealing with the logistics of trying to create a merit-based society.

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  • $\begingroup$ So basically this could work if these people had something analogous to nano-fabrication. The merit system would then determine a citizens right to withdraw resources from the system. This does leave the question of what is the role of the Artisan/merchant caste in such a society. $\endgroup$ – Trismegistus Feb 27 '15 at 16:40
  • $\begingroup$ @Trismegistus That's one of the issues that would arise - you would have others, such as who gets the nano-fabrication tool, what energy source you use to power it, who determines where the nano-fabricated items go, whether to use it for luxury goods if the number of nano-fabrication tools are limited...the ramifications are literally staggering. $\endgroup$ – Zibbobz Feb 27 '15 at 17:07
  • $\begingroup$ Given that this is a statist society,government controls the distribution of nano-fabricators and controls what they can fabricate;jail-breaking fabris is likely a major crime. I'm certain that every domicile has one it's a vital appliance. $\endgroup$ – Trismegistus Feb 27 '15 at 18:00
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How might a Merit based Economy work?

It wouldn't.

The problem is that people cannot agree upon what warrants merit, since some people will see one approach as deserving merit and others will see something else. Look at today's businesses - even within the same role, different people get different raises, even though they are "by merit".

Worse, once you start getting into specialties, and then into the higher skill levels, fewer and fewer people know enough of the specialty at that tier to evaluate merit at all. So you get fewer people being able to dole out merit rewards until there's a clique of a very few who wield the power.

Human nature would then take hold and it'd fall into reputation economy (at best).

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  • $\begingroup$ Part of my idea was encapsulate a persons salary and numeric representation of their rank/proficiency with a single concept. A group of elites at the top is absolutely fine, this culture is not meant to be without hierarchy. $\endgroup$ – Trismegistus Feb 26 '15 at 20:02
  • $\begingroup$ @Trismegistus and how do you put a number to "proficiency". Nonsense, just doesn't work. $\endgroup$ – o0'. Feb 27 '15 at 9:43
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    $\begingroup$ This is exactly what happens with pseudo science. The topics discussed are often so niche that nobody can rival the theories put forward. Instead, doctorates are awarded, monies paid, and people make their whole careers out of complete fantasy. In the UK, they've been spouting about meritocracies for years but in reality they are just pseudo-societies, ran in parallel with rather than instead of capitalism - which is what the OP proposes here. $\endgroup$ – csharpforevermore Feb 27 '15 at 15:20
  • $\begingroup$ @Lohoris Performance evaluations and other tests meant to grade a persons aptitude actually exist on earth. So there is away though it is by no means perfect to grade "proficiency". $\endgroup$ – Trismegistus Feb 27 '15 at 16:17
  • $\begingroup$ @Trismegistus - aptitude != application. I can be great at something without actually helping society. $\endgroup$ – Telastyn Feb 27 '15 at 16:21
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I am the government. You are an engineer. Your brother is also an engineer. You repair our first major Space station habitation, your brother repairs a nuclear reactor in a major metropolitan area. I, the government, reward your brother for saving countless lives. You are obviously quite ticked to say the least.

This is an example of why this economy wouldn't work. To make an economy like this work, you would need a few things.

  • Everyone devoutly supports the government

  • Universal acknowledgement of the governments' say as final

  • A pre-defined scale of importance that encompasses every single possibility, no matter how remote, that defines the rewards that will be handed out for the completion of each beneficial activity

The first two are extremely closely related. You could look at North Korea as an example of how to achieve those (some North Koreans disagree, but in the end those who speak out are executed or imprisoned). You would need the final bullet to stop major conflicts like the scenario above from happening. The conflicts that would otherwise occur would, as stated in a previous answer, quickly make it into a reputation deal. The scale would contain the possible rewards for every possible action performed by individuals in each caste. This obviously makes no sense, and therefore it would fail quickly, then: Back to using money!

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  • $\begingroup$ Part of my idea was to encapsulate a person's salary and numeric representation of their rank/proficiency within a single concept. Societies with structures that we would see as unconventional can work, the Inca come to mind who were perhaps the closest thing to a functioning socialist state that has ever existed. $\endgroup$ – Trismegistus Feb 26 '15 at 20:11
  • $\begingroup$ I was highlighting that it would be a hard change. I am assuming this is future Earth. Furthermore, there is a reason coinage and money has thrived and taken the world by storm. It was developed simultaneously across the globe. It is easier to say a loaf of bread is three pieces of silver, than define how much bread each individual gets for each and every thing he/she does. $\endgroup$ – JDSweetBeat Feb 26 '15 at 20:19
  • $\begingroup$ This is not earth,perhaps i should have stated that? While there was no"coinage" the people still use a medium of exchange. So their economy wouldn't be unrecognizable,unlike Star Treks. Would combining rank and salary really be that impossible. $\endgroup$ – Trismegistus Feb 26 '15 at 20:47
  • $\begingroup$ To have the salary and rank combined be fair enough for all parties to accept, yeah. Women in USA are complaining about doing the same tasks for less....I kinda figured they would have some kind of money. What you are talking about is basically the principle of Marxism.....which was abused by its first users-Russia. $\endgroup$ – JDSweetBeat Feb 26 '15 at 20:53
  • $\begingroup$ I hadn't realized that I'd stumbled into Marxism. All people of the same rank are supposed to be paid the same thing. A base rate perhaps similar to Pay grade; with bonus for exceptional performance,going above and beyond the call of duty. This seems to be drifting away from merit as money. $\endgroup$ – Trismegistus Feb 26 '15 at 21:07
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I think you need to consider exactly what you're defining here. I think you can do this, but your society will be problematic, and you'd have to embrace that.

There are three aspects. You want a

  1. redeemable reward that is
  2. allocated based on merit
  3. as evaluated according to contribution to society

Let's consider two out of three.

1 & 2 = Capitalism

Yeah, yeah, capitalism isn't perfectly merit-based, but whatever. Roughly, what your talking about is one party evaluating someone else's contributions to private ends and rewarding accordingly.

#3 would have to be pasted on by a central authority that redistributes based on corrections for private versus social returns. But most capitalist economies do some amount of this: funding scholars and teachers and police, taxing corporations.

1 & 3 Aristocracy, Caste System, etc.

If you have redeemable rewards based on contributions to society, than your society has a strong rankings of tasks according to how much each contributes. Those who function in this system do receive some sort of pay, i.e. redeemable reward, but it is often rigidly set by norms and typically one's place is assigned by heredity.

#2 must be pasted on, and how it is done depends on what you mean by merit. If it is overall merit at some central task, you assign caste or status based performance at this task, and status determines reward. This is similar to Lilliput (as in the case of a non-sense taks) or traditional Chinese bureaucracy, as in the case of a centralized exam. If you mean merit within a task, then you create room for rank, and cash wages are based on that.

2 & 3 Utopias

I think this is what you mean, and it really gets at the heart of what is described in Utopias such as Doctorow's Down and Out in the Magic Kingdom and Edward Bellamy's Looking Backward. You see, if you picture yourself rejecting cash because that's not the idea you mean, then what you are rejecting is the full redeemability of the reward. That is what defines cash. Anything that essentially differs from cash is somehow not fully redeemable. Doctorow has Whuffie, which is not fully redeemable because you do not deplete it, but rather use it to queue up for scarce resources. Bellamy has a fully equalized ration of goods that does not depend on work, but more difficult or perilous work is compensated by shorter hours, i.e. excess leisure, which is not fully redeemable.

The trick here is not thinking about how to paste on #1, but thinking about how to handicap #1 in such a way that the reward you speak of is not effectively cash. There must be things that money cannot buy that the reward can buy, unless you strictly forbid money altogether. Someone must decide what is valued; this can be a central government, but not necessarily. Maybe society as a whole has a long-lasting tradition of valuing some castes more than others, and castes have elders who recognize extraordinary individuals within the caste?

I hope that's an interesting framework.

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  • $\begingroup$ If you define merit by making things people are willing to voluntarily shell out their money for, Capitalism fits the merit definition very well. It is those that fail this definition that try and define merit by some higher, more noble rule that ranks them better. $\endgroup$ – Oldcat Feb 27 '15 at 0:20
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The Inca Empire had something in this direction. it was called Mit'a.

Every male hat to devote labour force to the government as part of taxes. It was also used to trade between members of the society. Something like: If you build my house I will craft you some nice statues for yours.

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  • $\begingroup$ That's actually a decent explanation of how it would work - exchanging services rather than objects of value. $\endgroup$ – Zibbobz Feb 27 '15 at 14:52
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I have an idea, though this may be quite a whole lot less realistic than the above answers, owing to my overactive imagination and general rejection of reality.

But basically, what about some kind of karma-tracker? I had previously bounced this idea off a couple of my friends when we were toying with potential designs for utopias. Imagine a system where every good deed you do adds a bit to your 'Karmic bank' but every bad deed subtracts from it. How would they know when to add or subtract? I don't know, magic or something.

Then basically, you do not 'pay' for goods with karma - you earn your goods with karma. A man with high enough karma could simply take what he needed - it would not subtract from his total karma. Karma is not a currency - its a measure of you as a human being. This system would be reliant on the fact that a person with good karma would not take more than what he needed, unless only to use it for good.

However, even as we discussed this, my friends and I realized how disgustingly utopic this is, so please mess it up a little if you decide to use it.

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  • $\begingroup$ "A man with high enough karma could simply take what he needed - it would not subtract from his total karma" -- so after earning enough Karma, one guy can just walk around, deciding to "need" an arbitrary amount of things? This would degenerate quickly. If not, then you need some super-entity that decides what goes and what doesn't. In the end, someone must control the karma giving and taking, and whoever that is becomes a supreme ruler. If "magic" is a wise, supreme ruler... well, then you've defined the problem away. $\endgroup$ – Vandroiy Feb 27 '15 at 11:29
  • $\begingroup$ This almost works as is. Especially if these people are nigh post-scarcity. The karma would serve as the valve on excess to abundance. $\endgroup$ – Trismegistus Feb 27 '15 at 17:00
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I think you have to define 'merit' better.

The society we have currently uses a meritocracy, with money as a token of reward for your efforts. Now, we all know that a banker is worth more than a nurse... don't we? Or do we? A banker uses his skills to generate much wealth that increases the tax coffers of the state which can then be used to hire more nurses, whereas a single nurse just does 1 person's worth of nursing.

Is the banker therefore more meritorious within society as a whole? And is that why he gets paid significantly more than a nurse?

In any case, even if you could define merit well, you'd still use money as a form of reward for people, only their pay would be tied to their merit rather than the 'evolved' or 'developed' version of it we have today.

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I very much appreciated the Admins and Merchants comment, in many it solves your merit based karma economy problem. Right now we have merchants and admins who determine value. Perhaps in your society you don't have A supreme person giving out merit or karma but representives people voted on to give out such. In such a society people who are considered fair and moral would be the ones you choose to give out merit or karma. The first kings would have been those who were more powerful or popular the problems came in passing their power to their children- in a merit based world you would need people to not pass power or wealth on and to have every citizen start at a zero point that is at least fairly equal.

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  • $\begingroup$ Welcome to the site Brent. You make some good points but may want to elaborate a little to discuss how it would function as opposed to a singular issue with the system. Check out the help center when you have a chance. $\endgroup$ – James Jan 20 '17 at 16:45
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Merit tokens as fiat currency.

Well, you did specify "in brief" in the question!

But fine, longer answer:

Some form of currency to exchange earned "merit" would have to happen. A black market would develop.

At that point, you're back to normal transactions, but with strange side-effects.

As an MMO programmer, one of the deeply ingrained things we learn when designing an economy is to consider our currency Sources, and Sinks.

All the Sinks in this system seem to be the merchant class: that's where the "merit tokens" get spent, so it's where they end up. Though like I said, there'll be an untaxable black market of merit tokens between other castes, in return for services rendered. Though you could pass laws taxing service provision, too, in which case, those taxes too become Sinks.

Admins are the ultimate Source, which distributes to other castes.

So the Admins & Merchants have all the power in this economy, everyone else is essentially at their mercy. Admins decide your worth, your Merit point earnings. Admins then give you those points. Admins also take the points away from merchants almost 100% in order to pay the others.

Through the black market, Merchants will become wealthy. However, Admins will become powerful, and by fudging the taxation numbers, will also become wealthy.

And I hadn't realized when I was writing this up, but this describes the fall from idealistic socialism/communism to the strongly caste-based, centralized-power-and-wealth Communism systems that we saw towards the end of the cold war. In this light, this feels inevitable, and I can't see any good methods to prevent such a slide.

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    $\begingroup$ You said "(in brief)"! Slightly longer answer: Some form of currency to exchange earned "merit" would have to happen. A black market would develop. At that point, you're back to normal transactions, but with strange side-effects. You need to consider your currency Sources, and Sinks. All the Sinks are the merchant class. Admins are the ultimate Source, which distributes to other castes. So Admin & Merch have all the power in this economy, everyone else is at their mercy. Admins will have to tax merchants almost 100% in order to pay the others. $\endgroup$ – Dewi Morgan Feb 27 '15 at 4:17
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    $\begingroup$ Consider adding that comment to the answer. $\endgroup$ – overactor Feb 27 '15 at 9:28
  • $\begingroup$ @overactor Nah, I'm OK with downvotes as a "joke answer", since they're quite correct: the comment's just a bonus. It's also perfectly visible, and I'm confident that the OP, Trismegistus can read it. Even if not, it feels like just the natural implication of the inevitable fiat currency in such a caste system anyhow. $\endgroup$ – Dewi Morgan Feb 27 '15 at 20:16
  • $\begingroup$ Hey, I hadn't realized when I wrote it, but the system described is basically idealistic communism/socialism, and my comment describes as inevitable the slide into the more realistic despotic caste-oriented communism that we see in real life. Huh. OK, this is getting past "naturally implied"... well bugger, there goes a perfectly good joke. $\endgroup$ – Dewi Morgan Feb 27 '15 at 20:19

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