Instituting NEO

▶︎ The first adopters of NEO are likely be belong into a particular group of people, who will make their products available only to recipients who will agree to reciprocate with their own labor. For example, an entrepreneur who today is offering his or her product under the freemium model can offer the free, or the first paid level to be purchasable with Chrons. This option should be attractive to the entrepreneur due to the Chron's intrinsic (albeit initially small) value. The potential buyers on the other hand should be willing to pay, because the "barrier of entry" in NEO is lower (for one, anybody can earn Chrons for work of their choosing). NEO also does not impose high transaction fees*, which together with the relative painless way people can earn Chrons, makes NEO an ideal micropayments platform. For that reason NEO could be adopted relatively early as a payment method also by content creators like newspapers.

The next adopters will be the buyers of products created by the "pioneers". As goods and services made by them will be available only for Chrons, people interested in using them will need to either earn them by creating their own products, or purchasing them instead. Many of the ones who will choose to earn Chrons by making their own products are likely to seek buyers, as only a sale of own products can earn Merit reward. The network of participants should be therefore "virally" expanding, aided also by Chron purchases made by the people not willing to participate in the NEO economy. This form of Chron acquisition will establish an exchange rate for the NEO currency, allowing all its holders purchase products not made in the NEO economy.

Over time, several additional factors should speed-up adoption of the economy:

  1. the increasing social reputation of the Merit score,
  2. the strong job-creating function of the economy,
  3. the growing exchange value of Chron.

▶︎ Due to automation, globalization and robotization, the pressure on governments to create jobs for citizens is increasing. In response, governments use several mechanisms to address the threat of unemployment. One of them is providing various forms of financial aid (tax breaks, building infrastructure,...) to attract firms, in return for commitments to create new jobs. This scheme has however its drawbacks: deformation of the competitive environment in which the firms operate, or opportunity for loss of taxpayers money due to corruption during the approval process. Investments into various education programs is another job creating tool, but its effectiveness depends on the correct selection of skills being taught and timing, as the well-paid employment opportunities of today might not exist by the time graduates are ready to enter the work force. Various universal income guarantee schemes also exist attempting to address the problem of disappearing jobs by providing all citizens with a no-strings attached, regularly issued payments. This approach however is facing many problems, with the source of financing being the main one.

For these reasons, implementing a "state" version of NEO should provide a more just and economically efficient solution. It could be implemented in the following way:

  1. A "state" version of NEO would be made available to citizens (and only to them) of that state,
  2. the government of such state would invest the resources currently used for providing unemployment support and (all) job-creation activities to establish and maintain an exchange rate between a special ("state") version of Chron and the official state currency on a level that would allow the NEO worker to earn desired (presumably the official minimum) wage. The governments would do so by buying Chrons on the exchange market. These Chrons could the government invest in NEO projects, thus increasing merit rewards of the economy participants and thus fueling their desire to produce socially desirable goods or services.

The currently unemployed workers would be encouraged to either create work of their liking, or seek employment in jobs created by the NEO and non-NEO entrepreneurs. The following behavior could be expected:

  • initially the workers might create work without value,
  • about 70% of workers are likely to attempt creating valuable work (this is a behavioral experiments-identified number). Some will succeed and receive Merit rewards,
  • behavioral science predicts that the Merit reward recipients should be motivated to try earning more Merit reward,
  • behavioral science predicts that people will start comparing their own Merit scores with the scores of the best performers, which should lead to increases of their own motivation,
  • valuable work produced in the NEO economy should slowly decrease demand for the official state currency and the NEO-financing burden of the state could be either lowered, or kept constant and cause growth in the Chron value. That should raise the real income of the NEO workers and attract new workers from the non-NEO economy,
  • slowly the state economy would be transferred to all "state NEO" economy,
  • at this stage the social reputation of Merit score will be comparable or higher to reputation the wealth ownership signals in capitalism,
  • workers in NEO economies from more developed states will realize that they can invest their excess Chrons into "poorer" "state NEO" economies and earn Merits from those investments. This flow of investments should over time completely eliminate economic inequality between countries.

Development phases

Phase 1 - Concept

This is the phase NEO project is currently (early 2017) in. A paper describing framework of the project was written and informational web site built.

Phase 2 - Bootstrap

A proof of concept implementation of Rovas will be built, with the following goals in mind:

  1. make live demonstrations of NEO functions possible,
  2. fine-tune the economy rules,
  3. allow the Rovas developers and potential investors to earn and monitor their Chron and Merit balances.

Participation in the economy during this phase might be restricted to Rovas developers and investors.

Phase 3 - Implementation and deployment

The production - a generally available version of Rovas is developed

* It is undecided at this time (early 2017) how people developing Rovas and maintaining NEO will be rewarded, therefore it is possible a small transaction fee could be implemented. However, if Rovas has a monopoly, the amount will be on the order of promile of the transacted amount.

Helping NEO to become reality

To speed-up the process of instituting NEO, any help is welcome. Please use the links at the bottom of this page to send inquiry about participating on the project.