Digital money? I don’t know if you’re counting digital money as ‘real money’, or if you’re merely constituting that as physical notes and coins, but it seems to me that -if you don’t want a post-capitalism society that has forsaken money altogether- digital money is an easy way to go.

Attach an account to people’s ID cards, and use scanners to both accept wages by transfer and spend money on goods and services. This is both lightweight and doesn’t take up much space, and I’m assuming by that point technology will hopefully have advanced to the point where such chips and scanners would be minuscule. If you wanted, you could even have the chips embedded in people’s arms, a futuristic technology that we’re coming into already!

I hope this helps you out! xx

Welcome back, friendly anon! I originally nearly Rule of Reality’d you again, but the wonderful @scriptaccountant pointed out some ways I can still help you out. (Note: I’m still technically on hiatus but I’ve managed to scrape up a spare thirty minutes, so let’s see if I can actually answer some asks).

3% of 500k is 15,000 aliens, give or take a few for biological fluctuations. If each alien prints $1m a day they’re throwing around $15bn a month at the economy; after 6 to 8 months the money supply should stabilize as the disintegrating money is matched by more new money from the aliens, and they cancel themselves out.

However, in the short term, you’re likely to end up with some pretty hard core inflation. For one thing, if your aliens simply show up out of nowhere and start raining down bills like gangsters in a strip club, no government or financial institution is going to have preparations in place to prevent a hike in inflation. Whether you look at it from a Keynesian perspective (more money in people’s pockets means more spending which pushes up prices; basically, too much money chasing too few goods) or a monetarist perspective (increasing the money supply inherently causes inflation because of mv=pq), you’re going to wind up with some potentially massive short term inflation. For the absolute worst end of the spectrum, look up hyperinflation in the Weimar Republic and Zimbabwe -this should give you some ideas of the negative effects your aliens might cause via huge inflation.

The disappearing money is also likely to cause problems throughout the whole economy. Imagine if you wanted to sell your old school textbooks: would you accept cash for it, knowing that the cash might disappear two minutes after you made the transaction? Would a bank accept a cash deposit knowing that it might disappear three weeks after it goes into the vault? Would a corner shop or supermarket accept cash in exchange for your groceries? Money only works because we believe in it, and if that belief dries up, so might our common usage of money. If the destruction of faith is bad enough, we could end up back at a bartering system, because at least those tomatoes you traded for those eggs won’t magically disappear.

I hope some of this has (finally) helped you out. I’m afraid I can’t tell you exactly how much inflation there would be, because that’s a wild guessing game for economists much cleverer and more experienced than I. Nevertheless, I don’t think anyone is going to call you out if you guesstimate some hyperinflation, mainly because they have no way to prove you and your cash-generating aliens wrong. What are they going to do, start a study? Somehow, I think not.xx

I’m afraid, my dear Anon, that this is one of those questions that would have greatly benefitted from being asked off anon. I know that’s not really an option for some people, but I could really do with narrowing this down before I attempt to answer.

Is this a worldbuilding question for a fantasy/sci fi novel or are you asking about the modern day? Are you asking from a perspective of ‘big private corporations already have governments in their pockets right now in the real world’, or are you asking what would hypothetically happen if this occurred irl? (Disclaimer: I’m not willing to disclose my opinion on which one I believe because I don’t want to attract the resultant drama either way). Is this one big megacorp pulling the strings of lots of national governments? A conglomerate controlling lots of governments? Separate or rival companies controlling separate/rival governments? Plus, and perhaps most importantly, how deep does the control of the companies go? Are they blackmailing heads of state, or using legal methods such as lobbying or funding the campaigns of their preferred candidates?

Moreover, which aspects of the economy do you want me to talk about? Is it companies lobbying for fewer workers’ rights so they can pay less wages, pensions, sick pay and maternity etc. and make higher profits? Are they so in control that they can make governments legislate to outlaw their rivals? More importantly, what do these companies actually want? Higher profits? Political control? State-funded space travel and green energy in a belated attempt to save the human race?

This is a very interesting question and I’m very glad you asked it. You could base entire novels off this premise in a variety of genres, and I have hope that my incessant questions might spark off a few ideas. But as it is, I’m afraid this is all I can offer for now.

Good luck, and feel free to send a follow up question!xx

You have my apologies for this, dear anon, but on this one I’m going to have to borrow

Aunty Scripty’s Rule Of Reality

and say that if you broke it, you’re going to have to fix it. This is simply too far away from the real world for me to even have a guess at what might happen. Your story idea certainly sounds interesting, but I have to ask: 3% of how many aliens? 3% of 9 billion aliens is rather different than 3% of 90.

Moreover to that: how much money? How fast can they create it? How accurate is it, could it pass for real money or is it obviously fake? Why are they creating earth money? Which currencies are they creating? Do they even have a concept of money, or inflation for that matter? Are they creating it secretly or blasting pound coins at Margaret Thatcher’s face on national television?

I try not to invoke Aunty’s rule because I know a lot of writing questions for an economist are going to be far out of the usual range of supply and demand (and the rule also doesn’t belong to me), but in this case I have a) absolutely no idea and b) permission to borrow the rule.

I wish you all the luck with your inflation-creating aliens! (And trust me, if they’re creating rapid inflation in the UK or the US in the 1980s, Reagan and Thatcher are going to be after their extra-terrestrial asses so fast the poor blighters won’t know what hit them). Happy writing!xx

So this has taken a long while for me to get around to answering, for which I would like to apologise. To be honest, beyond the theoretical concepts and the basics, stocks and shares really aren’t my area of expertise. You can study a lot of areas under the banner of economics and maybe you can study this in more depth, but I’ve always been more of a big picture economist and I’m pretty (though not 100%) sure that this ask technically comes under finance. Nevertheless, I’ve cajoled and harassed some of my fund manager contacts into providing some circumstantial thoughts, though I can’t say that this is up to my usual fact-checked standards! I hope this can still help you out somewhat.

According to my sources, illegal information constitutes anything that can be conceived as giving an investor an advantage. This can be anything from the retirement/departure of an important employee, to a new product: I got a lot of rants about compliance being entirely unprintable words extremely inane about literally any information being shared. But as far as I can tell, you have to do something pretty bad to actually get arrested: you can google ‘insider trading’ for more detail on actual criminal behaviour in this area. Basically, leaking any information that could potentially affect the share price can be classed as insider trading, even if (for dramatic literary reasons) you probably want some big juicy piece of information, like say an Apple-equivalent company being about to announce a brand new product, for your MC to get involved with.

As far as I know, companies can buy stocks in the same way as an individual can. They can both buy shares in other companies (known as a stake; they can also use this method to take over other companies by buying a controlling stake) and in their own companies. The latter may especially be of interest to you, as a decision by your CEO to buy back shares in their own company should decrease supply and therefore push up prices -foreknowledge of this could make your character very wealthy if they could get away with buying the shares just before the company announces plans to buy the shares back themselves. Then, either your MC can sell her shares directly to the company for more than she spent buying them, or she can hang on to them as the prices increase and sell them later, again for a profit. 

As for stock exchanges, every/most countries tend to have their own stock exchange, with companies that originated in that nation being listed (i.e. where you buy shares in that company) in their country of origin. However, I understand that London, New York and Hong Kong are all considered international stock exchanges too, and so huge international firms from a smaller country may choose to list at one of these exchanges as well as the one in their home nation. Mergers between firms of different national origins can complicate matters, but let’s not wander too far down that rabbit hole. 

And as for predicting international share prices, it’s the same as with predicting domestic share prices: skill, experience and luck. There are massive sections of the financial sector dedicated to this practice, including fund managers, hedgefunds and many other obscure jobs I’m sure neither of us have ever heard of. I’m afraid there’s no surefire way or brilliant trick for predicting trends that your character can use: unsurprisingly, it’s a lot easier to make money through insider trading than legally playing the markets. On the flip side, if your character does make a lot of money through insider trading, they can always hide behind the excuse that they’re just very, very lucky.

I hope this somewhat vague answer can help you out, and if my followers have any suggestions or corrections, I am more than ever open to hearing themxx

To borrow a line from Hamilton ‘your debts are paid ‘cause you don’t pay for labour’. Slave labour is shitty, awful, and robs people of every right and freedom they deserve as human beings. But I’m not here to discuss that, I’m here to discuss the economics of the situation, so let us -for a moment- put our morals aside and dive down into it.

Slave labour was used precisely because it is largely free labour. There is the original purchasing cost, but that is negligible compared to the productivity of a slave across their lifetime. A slave will earn a great deal of money for their owner, more than any paid worker simply because the cost of their wages doesn’t take a cut out of the money they earn for the company.

If there is a mass liberation of slaves, their owners will have a sudden, massive lack of labour. Not only will they suddenly have to pay people to work in their fields/factories, which will take a big cut of their profits, but their former slaves might refuse to work for them at all. Would you work for someone that bought you, and had you whipped and beaten into compliance? I certainly wouldn’t.

If they don’t work, nothing gets produced until the bosses can get a new workforce in, which can take days or weeks or even months depending on how quickly they can hire and ship in new workers. If the ex-slaves do work but insist on being paid wages, the costs of producing any goods or services that once relied on their free labour is going to increase, massively in the case of labour intensive goods such as sugar and cotton. This will cause a big increase in prices, and will most likely lead to inflation. You’ve also suddenly got a lot more people with their own money looking to rent, buy clothes and furniture, so with a lot more demand and the same or less in supply, those prices are going to increase too, also leading to inflation.

I’m slightly confused as to how the slaves would be freed without their masters knowing, but they could and probably would be freed without their masters’ consent. Nevetheless, that part of your world isn’t up to me, so I hope this helped you out. Happy writing!xx

I’m afraid this answer might be a tad short because I’m really not sure what to tell you. Depending on how much money you have, living costs can continue to spiral on upwards forever: think £30million private jets. Are they a necessary living cost? No. But do they technically count towards that person’s cost of living? Yup.

However, let’s say our dear totally-not-James-Bond is an MI6 agent who’s been on duty for 5-10 years, and so is on a salary of £40,000 grand a year. Our dear not-Bond also seems to have quite possibly inherited some money from his family estate, but since I can’t currently quantify that let’s set it aside for now.

Let’s also assume -because there’s no way he can afford a house and cars that nice on £40,000 a year- that MI6 pay for his lodgings and transport. Rent and transport takes up a lot of most people’s wages, so I suspect he’ll have a lot of money left over for designer suits and martinis.

If you need this information for a fic, for registering his expenses or whatnot, I have a sneaky tip: make it up. As long as it’s within the realm of reason I doubt anyone would notice. Call it £36,759.67 and have someone make a joke about his expensive taste in Armani suits, have him retort the cost of his suits is nothing compared to the martinis he drowns his sorrows in. I suspect -though obviously I don’t know- that you might be overthinking this: I severely doubt anyone is going to start fact checking your expenses calculations!

Apologies that this took so long, and I wish you luck handling that neverending supply of Aston Martinsxx

This is a difficult one. While your guy is a certified Cool Dude™ and I applaud them wholeheartedly, if your characters can do stuff like this on a whim, I think they’ll end up at least partially breaking the economy.

The problem can be explained through one of the very basics of economics: supply and demand. Ignoring complicating factors, infinite free supply of a good or service means no-one is going to be willing to pay money for the same product. So if your infinite housing is of good quality, absolutely no-one will be willing to pay money for housing. However, since you’ve said that the rooms are small, people may be willing to cough up more money in the traditional housing market for more space/rooms/nicer facilities etc.

Now, obviously this isn’t something that could happen in the real world, so everything I’m suggesting is educated guessing. But I’d say it wouldn’t be unreasonable to see two parallel markets forming: your guy’s free but small rooms, and the bigger fancier suburb-style houses of the rich. After all, it would save governments a lot of money if they could refuse to pay for council housing/rent benefits by funnelling people into infinite free housing. I suspect you’d get the middle/upper classes living in their own homes, with a great deal of poorly paid single mothers/students/homeless people/working class families in this magical housing. As a result of this poor quality, shoddy and over-priced but grim housing will probably have no market, as people will simply move into the free housing.

And if people who usually struggle to make the rent suddenly have a lot of money to spend, that should give a big boost to other areas of the economy. Thousands of extra pounds per family could go to new cars, nicer clothes, better quality groceries, more toys and gadgets etc. etc. all of which will help consumption and economic growth.

I’m really struggling to argue that this would greatly affect the housing market for the average Joe that can afford his own accommodation that’s nicer than the free stuff. It might make it a little cheaper due to slightly less demand, but I honestly don’t know. Your world, your rules I guess.

I hope this helped you out somewhat! Good luck in your writing pursuits, and high five your Cool Dude™ for me!xx

Okay, you guys are really into destroying the digital economy! Which –disclaimer– is something I’ve never studied. All those ones and zeroes, that binary code that binds the world together? I’ve no got a clue how it works. Nothing, nada. I can’t even code well enough to edit a tumblr theme, so the complexities of the computers that run the digital economy are a total mystery to me. Plus, the complete destruction of digital money? Not something I can research here, either.

But! This is where the magical, beautiful majesty that is the rest of the ScriptFam steps in to help out, in this case namely @scriptaccountant and @scripthacker.

Hacker says (paraphrased by Econ):

Likewise, most governments will have protected electronics, to prevent against an EMP-style attack from a foreign nation if nothing else. Remember, a lot of big banks, corporations and governments trade on the back of their credibility: would you give your money to a bank you thought might lose it? I certainly wouldn’t. So these big organisation likely have very well protected electronics, and paper back-ups to boot.

Accountant says (again paraphrased by yours truly):

So in summary, I’m afraid we’ve rather sat on your idea. I know it sucks when you come to an advice blog and they tear down your idea, but if you’re going for realism it looks like your situation is very unlikely. You could find some way to also destroy the digital backups if your villain is clever, or incorporate the backups as a way for the government to get everything rolling again after the crash. I’m sure if all credit cards stopped working and the banks had to manually sort out the hard copies of everyone’s finances there would be a lot of frustration and quite possibly riots etc. to provide the chaos you’re looking for, and it would probably take quite a while to sort out. As for people who would benefit, I suppose those with a lot of cash on hand or goods to trade and barter (if the situation gets that desperate) might be better off than your ordinary Joe, but off the top of my head I can’t think of many people who would benefit from the total collapse of the digital economy other than hedgefunds massively shorting on banks shares and government bonds (and if you want me to explain that concept, feel free to send a follow up ask but it’s currently a topic for another day). But if your villain wants to make money from this, betting against banks and other businesses with a lot to lose sounds like a good plan; I’d definitely suggest they sell any Bitcoins they might have!

So while I fear that this might not be what you wanted to hear, I hope that it helps you out somewhat. Good luck with your writing!xx

Disclaimer: I’m not American. I have been to Aamerica once or twice, but I’m not entirely convinced I’ve ever held a five dollar bill.

Pretending to myself that this was about a British five pound note, I concluded that a good way to go about this would be to look at security features. Security features on notes are added to make counterfeiting more difficult, and they get more and more complex with each new release of new notes in order to stay ahead of the fraudsters. This: http://currencyguide.eu/usd-en/5usd-en.html seems like a reasonable website to jumpstart a few ideas, but I’ll list a few things you could change below anyway:

Hue/colour -this is a lot easier to describe than some of the more complex security features, and it could be subtle enough not to be immediately blindingly obvious, but evident upon closer inspection.

Lincoln -now, I’m not sure fully switching out old Abe for another, alternate universe historical figure would count as ‘subtle’, but you could change up Lincoln’s appearance. I understand he doesn’t have a top hat on the bill, so maybe give him one? Or scrap the facial hair. Or give him a stripey pink mohawk. Y’know, subtle.

Sigil of freedom -this one depends on how different your other world is. How American is America? Maybe they went for a wolf as their animal of freedom, instead of an eagle. Maybe the shield motif was never immortalised. But the sigil is quite small, so making it different could be a very subtle but ultimately universe exploring way of making the changes you after.

Of course, combining a few of these ideas will probably make for a longer and more complex realisation process. How similar is similar in terms of two different universes? I think you could have a lot of fun with this, and indeed I hope you do!xx

Okay, so in all honesty before this ask I'd never heard of the ASSA/AEA Annual Meeting. Now, I really want to go, if only to go heckle the 2017 Presidential Address to said convention.

Otherwise, I know nothing about economic conferences, especially huge American ones like that where I'm guessing only well-respected professors are asked to present. So unfortunately, I can't help with that. I have, however, utilised a very useful contact, so here’s a very helpful interlude from guest mod M:

A big thank you to guest mod M for her help!

If you really need a conference for your plot, I would suggest you either a) do a beforehand to afterwards transition focusing more on the emotions of your character(s) so you don’t have to somehow gain a PhD level understanding of public/labour economics, or if you really need to show what's going on in there, you can come back to me and we can try to BS an academic paper/panel discussion together. As M said, it will probably be helpful to limit the breadth of your conference massively, so you can limit your own research. One talk topic to research versus the whole of public economics should save you a lot of time.

As for what economists do: well, pretty much everything. But since you mentioned a professor/PhD student before, I'll focus on academic study, specifically on labour or public economics. Professors will be taking undergrad lectures and seminars, and while I don’t know exactly how postgrads and professors interact, I do know that (in the UK at least) postgrads often help out by taking some seminars. Both professors and postgrads will also have their own research projects, professors because they need the money and postgrads to get their masters or, in your case, PhD.

What they teach and indeed what they’re researching will depend on the institution. Some universities will have an economics department that specialise in labour or public economics, which means that your professor can teach a very small, specific area of their discipline (which would probably mean less research for you, as you could just go very in depth into one area). A postgrad will usually target an institution that is somewhat renowned for or specialises in their chosen topic of study too, so they can benefit from the extra knowledge and expertise. If your professor worked at a university that doesn’t specialise in those disciplines, they might be one of two or even the only professor of their subject, which means they’ll probably teach a very broad base course touching on just about everything about their topic, and not much else.

After the long wait for this response, I really hope it helps you out. I can only apologise for the wait, and to everyone else that’s waiting. All I can say is that I take too many classes, run too many blogs, and have too little time. Again, my apologies, and I hope this helps!xx