Over-unity means above one; it's a phrase that perpetual-motion crackpots use.
If you have a power transmission system, it's probably lossy, and you compute your overall efficiency by multiplying together your losses at each stage. For example, in a locomotive, the diesel engine takes diesel and turns a shaft, the generator takes the rotating shaft and generates electric power across a pair of terminals, and the traction motor takes the electric power and turns a different shaft, the axel. If the efficiencies are a, b, and c then the total efficiency is a * b * c. If you could build a chain that starts and stops at the same kind of thing (e.g. rotational motion), and that multiplies out to over-unity, then you would have a perpetual motion engine.
Businesses and creatures often have transmission loops of value or energy that are over-unity if you neglect certain crucial interactions with the rest of the world. Accountants traditionally cut those value transmission loops at specific spots (revenue recognition criteria), and I'm claiming that this has a couple effects - one is that it obscures the real loop-shaped architecture of the business, and the other is that it causes accountants to denominate everything in currency.
By analogy, if you cut metabolic cycles at ATP, unrolling them into energy-transmission chains that start at ATP and flow down to ATP, then it would be natural to describe your long fatty chains as "holding 1234 ATP equivalents".
By shifting away from necessarily denominating things in cash, you can apply accountancy insights to things without clear markets or even multiple agents.
For example, there are many over-unity loops in, single-player Minecraft. Plant a seed, wait, harvest wheat plus seed, repeat. That particular loop is only over-unity if you assume that a hoe or hoed-earth is available. A hoe, for the minecraft wheat loop, is similar to oxygen and prey, for animal metabolic loops. If you assume oxygen and prey are available, then the animal metabolic loop is over-unity, which is useful to know, because it will correctly predict exponential growth, limited by oxygen and prey.
I think studying how accountantcy deals with this little model is valuable. What is the correct chart of accounts? What are the typical transactions posted? If instead of 'cash' and 'goods', the pools were labeled 'foo' and 'bar', what units would the accounts be denominated in?
Oh, fascinating (re over-unity definition and crackpots).
So if I'm understanding your overall point correctly, you're saying that there's historical and pragmatic reasons for why accountants denominate accounts in cash, but that doing so hides certain interesting aspects of the system. I'm less clear on -- so if not cash, then what can accountants use, for modeling aspects of the business? Isn't the whole point of cash that it's sort of a universal conversion, between many different sort of things / units?
Meters are a unit of length. Feet are a unit of length. Furlongs are a unit of length. All of these are interconvertible; none of them are any MORE a universal conversion than any other unit of length.
Dollars are a unit of value. Loaves of bread are a unit of value. Gold coins are a unit of value. All of these are interconvertible; none of them are a universal conversion.
In a business that has a metabolic cycle consisting of trades 1 Foo for 2 Bar, and 1 Bar for 2 Foo, which ought to be the unit of account? How do we break the symmetry?
If Foos have significant carry costs (e.g. perhaps Foos are big, bulky things and you have to pay for a warehouse to hold them), but Bars have comparatively insignificant carry costs (e.g. perhaps Bars are little seed-like things, and it's easy to carry lots in your pocket) then you want your growth to primarily happen in Bars.
If you want growth to primarily happen in Bars, and you use Bars as your unit of account, then in considering what to do next (like a chess algorithm looking forward at the tree of possible futures), you can cheaply approximate the total utility of a situation by the number of Bars you have in that situation. The reduced computational cost in not having to convert is what breaks the symmetry.
If you have a power transmission system, it's probably lossy, and you compute your overall efficiency by multiplying together your losses at each stage. For example, in a locomotive, the diesel engine takes diesel and turns a shaft, the generator takes the rotating shaft and generates electric power across a pair of terminals, and the traction motor takes the electric power and turns a different shaft, the axel. If the efficiencies are a, b, and c then the total efficiency is a * b * c. If you could build a chain that starts and stops at the same kind of thing (e.g. rotational motion), and that multiplies out to over-unity, then you would have a perpetual motion engine.
For example: http://en.wikipedia.org/wiki/Simple_Magnetic_Overunity_Toy
Businesses and creatures often have transmission loops of value or energy that are over-unity if you neglect certain crucial interactions with the rest of the world. Accountants traditionally cut those value transmission loops at specific spots (revenue recognition criteria), and I'm claiming that this has a couple effects - one is that it obscures the real loop-shaped architecture of the business, and the other is that it causes accountants to denominate everything in currency.
By analogy, if you cut metabolic cycles at ATP, unrolling them into energy-transmission chains that start at ATP and flow down to ATP, then it would be natural to describe your long fatty chains as "holding 1234 ATP equivalents".
By shifting away from necessarily denominating things in cash, you can apply accountancy insights to things without clear markets or even multiple agents.
For example, there are many over-unity loops in, single-player Minecraft. Plant a seed, wait, harvest wheat plus seed, repeat. That particular loop is only over-unity if you assume that a hoe or hoed-earth is available. A hoe, for the minecraft wheat loop, is similar to oxygen and prey, for animal metabolic loops. If you assume oxygen and prey are available, then the animal metabolic loop is over-unity, which is useful to know, because it will correctly predict exponential growth, limited by oxygen and prey.
You might enjoy this little model of space trading games like Elite: http://www.jorisdormans.nl/machinations/forum/viewtopic.php?f=5&t=201#p512
I think studying how accountantcy deals with this little model is valuable. What is the correct chart of accounts? What are the typical transactions posted? If instead of 'cash' and 'goods', the pools were labeled 'foo' and 'bar', what units would the accounts be denominated in?
Reply
So if I'm understanding your overall point correctly, you're saying that there's historical and pragmatic reasons for why accountants denominate accounts in cash, but that doing so hides certain interesting aspects of the system.
I'm less clear on -- so if not cash, then what can accountants use, for modeling aspects of the business? Isn't the whole point of cash that it's sort of a universal conversion, between many different sort of things / units?
Reply
Meters are a unit of length. Feet are a unit of length. Furlongs are a unit of length. All of these are interconvertible; none of them are any MORE a universal conversion than any other unit of length.
Dollars are a unit of value. Loaves of bread are a unit of value. Gold coins are a unit of value. All of these are interconvertible; none of them are a universal conversion.
In a business that has a metabolic cycle consisting of trades 1 Foo for 2 Bar, and 1 Bar for 2 Foo, which ought to be the unit of account? How do we break the symmetry?
If Foos have significant carry costs (e.g. perhaps Foos are big, bulky things and you have to pay for a warehouse to hold them), but Bars have comparatively insignificant carry costs (e.g. perhaps Bars are little seed-like things, and it's easy to carry lots in your pocket) then you want your growth to primarily happen in Bars.
If you want growth to primarily happen in Bars, and you use Bars as your unit of account, then in considering what to do next (like a chess algorithm looking forward at the tree of possible futures), you can cheaply approximate the total utility of a situation by the number of Bars you have in that situation. The reduced computational cost in not having to convert is what breaks the symmetry.
Reply
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