Exchanging Obligations: Accounting for All Forms of Capital

Abstract

Economics and engineering have much in common since both are concerned with making decisions to act, based on evidence from many sources including science. An analysis of financial trading from an engineering-systems perspective leads to a theory of obligations as a means of capturing natural, social and human capital. The treatment is based on an analogy between gravitational and electromagnetic fields of forces and fields of human interactions. An ‘obligation’ is defined as an underived unit of ‘stuff’ analogous to gravitational ‘mass’ or electromagnetic ‘charge’ in a field of interacting processes. Identifying the forces generated in the field of human obligations will help create new policy and practical interventions. These should be designed (as engineers’ design) systems to maximise net worth that includes a wide set of natural and social assets, such as biodiversity, air quality and reduced inequality. JEL: Q50, Q01, E00, E60, O11, O14, C60

Institutionalizing a Pluralistic Alliance between Economics and Engineering

“…Specifically, some areas are locus of conceptual migrations of which engineering has been the source or vector: bioeconomics, econophysics, quantum economics, agent-based and system thinking-based economics of complexity. To these are added ad hoc modeling where, from time to time, analogies are proposed between economic processes and others of an engineering nature, e.g., those relating to the fields of gravitational and electromagnetic forces (see the recent work of the civil engineer Blockley, 2022).…”