Free Capitalist Network - Community Archive
Mises Community Archive
An online community for fans of Austrian economics and libertarianism, featuring forums, user blogs, and more.

The Subsistence Path

Man is an animal and can move around as he sees fit. Animals can follow their objects of desire whereas plants have to just sit and hope the environment supplies what is required. A man can follow whatever path he chooses in order to secure objects of desire. Primitive man would walk to the stream to drink fresh water, he would follow animal herds in order to hunt and secure game. All of these paths at a minimum required metabolic and caloric expenditure. In physical science thermodynamics account for energy flow and it tells us that in all activity a certain amount of energy is dissipated and lost from the reservoir available for useful work. Thus part of the metabolic expenditure and part of the caloric expenditure will be unusable and lost irretrievably to the environment. Fortunately the earth is an open system and the sun pumps massive amounts of energy from which all living things derive their reservoirs of energy available to do work to pursue the satisfaction from eliminating, even if temporarily, the mental tension from dissatisfaction.

Man can follow whatever path he desires as the surface of the earth is unbounded. However using his brain man will soon discover some paths are better than others. If thirsty going towards water has a better chance of success than going away from it. Stalking game when hungry has a better outcome than laying on the ground and waiting for food to arrive. Over time man builds up knowledge about which paths have better success than others.

A model of a subsistence behavior would be for a solitary man to follow paths in his environment in order to secure what is necessary for his survival. It is also possible that a clever might secure more than was necessary and decide to save the extra for the future. The excess between what he needed and consumed would form the first instance of a capital reserve. The path had yielded a profit. This profit would motivate him to follow that path out of an infinite choice of paths. This path might prove time and again to yield a continual surplus as compared against others paths. Who followed this path and when is lost in the mists of time, but it certainly did occur. The first capitalist was found. Capitalism is a behavior the focused drive using information about the environment to perform useful work to a surplus. Not immediately consuming the first surplus was the first instance of a low time preference behavior. The basic behavior that civilization was built upon.


Posted Mar 15 2010, 08:01 PM by George Giles