Is capitalism the prevailing economy today? Yes. Will it continue to be that way? Probably not. Put simply, capitalism is an accumulation of capital to derive profits. This is done by matching supply-demand. However, the irony is that by successfully doing this in a long term, capitalism is nearing its own death. How is this so?
In his New York Times bestseller The Zero Marginal Cost Society, Jeremy Rifkin pointed that our technological advances have allowed extremely efficient industrial productions. Supply is increasing, opening larger demand as a result. Consequently, marginal cost is pushed to near-zero, making goods and products abundant, to the point of almost free or near-zero prices. When this happens, profit plummets. Therefore, capitalism final destiny is its own end.
Advent of the New Economy
Rifkin added that Collaborative Commons is a logical successor to capitalism. It is an economy which sharing goods or services is prioritized over ownership, and decentralized production over the centralized. Some of the technologies assisting these movements include Internet of Things and 3D printing. However, for these technologies to contribute, they need an important component: energy to drive them in decentralized regions.
Decentralized Energy Source
Not just any energy, though. It has to be a form of energy which can be installed in a smaller scale, therefore allowing it to supply electricity to the decentralized Internet of Things and 3D printing.
- Coal-fired, nuclear, geothermal and hydro energy sources require large scale installations, therefore inappropriate for the decentralized applications.
- Wind energy sources can be installed in a somewhat smaller scale, but some regions have inadequate wind resources.
- Solar energy on the other hand, do not possess those difficulties.
Furthermore, solar energy costs have dropped 73% since 2010 to 2017, making solar energy an increasingly attractive option for our upcoming decentralized economy.
The Zero Marginal Cost Society: The Internet of Things, the Collaborative Commons, and the Eclipse of Capitalism by Jeremy Rifkin
Renewable Power Generation Costs 2017 by International Renewable Energy Agency (IRENA)