# Economy as computation Economic computation is the process by which an economic system defines, measures, calculates, coordinates, and distributes value and resources. It operates according to an underlying economic logic, often implicit in legacy systems. It’s more than data processing – it’s the very grammar of coordination, encoded in mechanisms that guide decision-making, resource flows, and relationships between agents. Every economic system has one, even if it’s invisible. We understand economic systems not just as social phenomena or resource allocation mechanisms, but fundamentally as computational systems. Every economy, from a local market to a global corporation to a decentralized network, is actively performing computation. Economic computation is the underlying logic by which any economic system defines, measures, calculates, coordinates, and distributes value. This isn't a metaphor. Economic computation involves the core processes that constitute economic life: * Defining: What counts as valuable? (Profit, utility, reputation, data, health of biosphere?) * Measuring & calculating: How is value quantified and aggregated? * Coordinating: How are actions between agents aligned? How are dependencies managed? * Distributing: How are resources, rights, and rewards allocated? Crucially, this computation isn't arbitrary; it operates according to an underlying economic logic or grammar – a set of rules, assumptions, and possibilities, often deeply embedded and taken for granted. Think of market price discovery as a specific, distributed computational process optimized for certain signals within a particular logic that prioritizes efficient allocation based on scarcity and individual preference. Think of corporate accounting as another computational logic, focused on tracking assets, liabilities, and ultimately, capital accumulation. Also blockchains perform economic computation, primarily focused on validating state transitions and asset ownership according to their specific consensus rules and often inheriting assumptions from legacy monetary systems. Recognizing economy as computation moves us beyond simply analyzing existing systems or accepting their rules as inevitable. It reveals that the "rules of the game" – the economic grammar itself – shape the outcomes, the limits of what can be valued, and the kinds of agency possible for participants. It opens the door to consciously designing and engineering new economic logics encoded in programmable protocols. This understanding is the bedrock upon which we are building – aiming to create protocols that enable more expressive, adaptable, and purpose-driven forms of distributed economic computation, pushing intelligence and agency to the network edge. When networks and their agents can define and compute value directly, they stop being “users” and become *economic subjects:* agents who coordinate together, express new forms of value, and compose their own economies. Computation shifts from a passive backend to an active, creative force within the network where we do it together. Coordination becomes internal, adaptive and expressive, not externally imposed. It is not just decentralization, but a new kind of *economic intelligence and agency*. --- ### Related context items (What is happening?): * [Evolution of economic computation](https://hackmd.io/@ECSA/H1-O2OGSgg) * [Distributed economic computation](https://hackmd.io/@ECSA/rJZYQFGSge) * [Protocols are political](https://hackmd.io/@ECSA/HJabbrHHlx) * [AI is forcing a fundamental rethink of economic coordination ](https://hackmd.io/@ECSA/SkzrBIHHgl) --- ### [ecsa thesis: Table of Contents](https://hackmd.io/@ECSA/BJNHpLfrxl)