Archive for June, 2009

Inputs and outputs: best in balance

It is important to note that the area of achievement (C – marked in red  in the previous blog) is more complex than initially shown. It is in fact a composite of interaction at two levels. First there is an area of achievement that represents the person’s contribution to well being: what they produce, what they give, what they share with others. There is a second area: what they get from society, be it material, emotional and so on. Of course one would assume they are additive and that can be the case. I enjoy my work. In the process of work I both hope I create benefit for others; I do definitely benefit myself. But the process can also be negative: a person can have constraints placed upon their ability to achieve, whether by law, lack of resources, failure to learn, lack of support, or sheer lack of purpose (the apparently brilliant person who simply wastes their talent for reason of having no idea how to focus it on anything). I won’t explore this aspect of constraint now. I mention it to make clear that the area of achievement is more complex than a matter of totting up a scorecard. The area of achievement is the combination of what are in effect outward and inward flows resulting in a compromise result.

The following diagrams illustrate this for the moment:

diag11

Here the red area is the person’s own desired achievement. But society pulls the person in quite different ways. This person clearly seeks intellectual achievement: society (the blue area) pulls them in the direction of material well being. This might be the academic who goes to the City. And it is clear that this person’s family attaches emotional reward to that material success. Neither society or the individual themselves is giving sufficient attention to the person’s purpose: they are in poverty here in both diagrams.

Combine the tw0 and you get an area of actual achievement something like this:

diag12

The intellectual achievement of this person has been muted: their material success enhanced. Their own conflict at the consequence reduces their emotional sense of well-being: they cannot respond to the input they receive because that input from others demands of them a response they cannot wholeheartedly give. They remain confused as to their purpose, and at risk in this area of feeling meaningless. The resulting conflict that means they neither achieve what they desire or what others desire of them, and as such actually overall are diminished in the benefit they secure from what they do compared to either input position might reflect that lack of purpose.

The key point is, once again, that balance is better. If those surrounding an individual can enhance what the individual has to offer and encourage it to flourish they will clearly be better off. If they (individually and collectively) cannot do that then the outcome detracts from the individual’s well-being. That may be obvious. I suggest the diagrams help make it clear.

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Balance is best

The reality is that  once a person has escaped relative poverty as described in the previous blog they are almost certainly going to be better off when their activities result in reasonably balanced achievements. I could do the maths to show why that is true: I won’t here, not now. These diagrams suffice. The person possessing the ellipse in this diagram (which are now smoothed for ease of presentation and with area C, the consequence of action, being highlighted in red) is better of than the person in the one that follows:

diag9

The first person may not have the peak experiences that the second one does with regard to both spiritual and material well-being but nor are they in relative poverty, or even life threatening destitution in any area of their life, but the second person is in that situation.

In fact, it is also possible to say that this person is better off than the person whose diagram follows:

diag10

Balance is best even when absolute poverty is avoided.

Plotting people

In the last blog a model of absolute and relative poverty was developed, leaving plenty of space over for varying states of prosperity to be recorded. All of which then begs the question, where am I on this diagram? Am I achieving, or not?

I think this can be plotted, but I would add straightaway that this plotting is subjective. It might be done by the individual themselves. It could be done by someone else. In either case the result is subjective because the criteria for assessment will always be subjectively chosen in the first place.

This plotting process is helped by a desirable characteristic of a circle, which is that it offers an infinite number of radii that can be drawn within it. The reality is that out of the enormous range of choices available we will choose a very limited range of options to try. That is one of the characteristics of being constrained, if only by time, which this model explicitly recognises. For each option that we try a radius could be drawn from the centre of the circle indicating the range of achievement we had reached. Analysis could be done on those choices. I am not pursuing that line of thought now. Instead, I want to draw a line joining a person’s achievements together. This becomes their area of achievement. It might look like this (and is described as C, the consequence of actions):

diag7

This is a person who is materially sufficient: they have enough to live on. They are largely emotionally satisfied. They have only two areas of relatively limited emotional concern. Their intellectual life is constrained, but only partly. They are however suffering a substantial lack of purpose and this is creating a serious threat to their well-being because they have moved into an area of absolute deprivation.

This situation is easy to translate to the reality of life as we see it. There are very many people who are materially well off and emotionally supported and who can apparently interact with society perfectly well who are nonetheless in crisis. The indication of this malaise in a person’s spiritual well being is relayed through anxiety, stress and ultimately the threat off or actual practice of suicide.

The importance of the model presented here is immediately easy to see. Conventional economic models only relate to material well-being. This model defines well-being in a very different fashion whilst (as I will show in due course) being able to handle the issues that a conventional economic model addresses. The implications will be explored later. The importance should be noted now.

What the model lets us do is assess relative well-being with comparative ease. For example, this person’s life is obviously unbalanced:

diag8

They are clearly materially well off. They have very poor social relationships despite that. It may well be that their sense of meaning is diminished as a result.

Adding values

Having created the quadrant model we can add some more depth to the model.

First there are two critical additional circles to draw. The first is tightly defined and will, for most people, be insignificant because of its remoteness. This is an inner circle which indicates absolute life threatening poverty. This might be caused by hunger, emotional isolation, an inability to communicate, the failure of your purpose: all can be life threatening (sometimes making people take their own lives). If a person’s level of experience is reduced to this level of achievement then they are at imminent risk, probably of death. Urgent action is needed.

This state of being is indicated by this inner circle, marked A for absolute poverty here:

diag5

Thankfully for most people most of the time this is not an issue: they are surviving at a higher level than this. But they can still be in what society would define as relative poverty; their well being is below that which it is generally considered to be necessary to achieve a reasonable standard of living. So this justifies the addition of a second circle, between that which represents absolute poverty and that which represents a person’s potential achievements. It is shown here marked R for relative poverty:

diag6

There are now three concentric circles. The innermost circle, marked A represents absolute deprivation. The area that surrounds it, marked R represents relative poverty. The area between poverty and a persons potential represents, for now, relative abundance

More about the quadrants

I stress that the allocation of space to quadrants referred to in the previous blog is an abstraction from reality. In practice most things most people will do most of the time will have some elements of more than one area of need contained within them. So eating in isolation may just be material satisfaction (although even then some intellectual curiosity about the food may arise). As soon as eating becomes a communal meal it has an emotional element too. Some meals are ritualistic: they are incorporated into the process of searching for meaning. I think my point is clear: don’t assume we single task. We never do, but it makes the diagram easier to think about things if drawn the way I have. This is what modelling requires.

I’m sure some will wish to challenge the choice of quadrants: all I can say is that based on much reading over many years in many cultural, faith and wisdom traditions these four seem to be recurring themes. They fit Maslow’s hierarchy of needs, for example (and don’t worry that he has five such needs and there are only four quadrants: this model will develop).

Representing need

The circle can by itself represent these ideas but that is not enough to take us very far forward. So I next recognised that each of us has real needs, and each of us has at the same time the potential to meet these needs in others. There are four of these needs. They split the circle like this:

diag3

The axes are deliberately diagonal: I hated the idea that we might be back on the conventional economist’s graph already. We’re not. Each of these quadrants has equal positive value for example, but by using horizontal and vertical axes this might not be obvious.

Each quadrant represents a type of human need. One is for material well being. We all need air, water, food, shelter, clothing, warmth, and more besides to survive. In our modern world we believe we need much more than that.

Another is for emotion. Just start with the needs inherent in a person’s relationship with their mother and move on from there: there is no one who can survive as a healthy human being without emotional relationships.

Next there is a need for intellectual development. We all need language. We must learn to provide for ourselves within the society in which we live. We are curious.

And, perhaps most contentiously (although it seems to me absolutely unambiguously), a person has a need for meaning. I call that their purpose. It could be called a spiritual need. I would be happy with that, but know that might alienate some, and I think purpose, in any event more encompassing. Either was, in I stress that it is definitely not religion. This is the quest for the answer to the question ‘why am I here?’ Unless that question is addressed it seems pretty unlikely to me that a person can achieve their potential.

You can lay them on the diagram like this (using M = Material, E = Emotion, I = Intellectual and P – Purpose):

diag4

The allocation of the quadrants is arbitrary. It’s just the one I use. Another would do just as well.

Living constrained lives

The unconstrained two axis graph cannot adequately describe the world we live in. It implies endless possibility. That does not exist.

Suppose for a moment we view ourselves as constrained in whatever we do. How might we represent that?

I would draw a circle around myself:

diag2

You could put a dot in the middle if you like to represent the centre of your being. I haven’t.

But what is clear from a diagram such as this is that the human being is constrained. There is a limit to their potential. This comes from limited ability, limited resources within the world, limited time (we all die, after all), constraints others impose on us, and so on.

It need not depress us. It seems apparent that human beings have, do and will continue to live goods lives in constrained circumstances. The question that economics needs to answer is how that is possible, and how the process of exchange enhances this possibility.

This is the focus of attention for my thinking.


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