The Economics Of Interstellar Travel

October 27, 2013 in Daily Bulletin

Sooner or later humans will be travelling the universe writes The Economist. (And perhaps destroying parts of it). What does this mean for economics?

  • Relativity is the conclusion that spacecrafts travelling very fast will experience time differently. Whereas decades might go by on a planet, those on the spacecraft would only experience the passing of a few years. This has economic implications.
  • One could, for example, invest a million dollars into something that yields 3% a year. They could then hop on a spacecraft, zip around the galaxy very quickly for a couple years, and return to the home planet where many more years will have passed and the investment will have grown substantially.
  • This would mean that interest rates would be determined primarily by the price of starship fuel.
  • Relativity will also meant that the net present value of shipments will be hard to calculate.
  • Since information couldn’t travel faster than the speed of light it would be impossible to arbitrage away the price difference between solar systems.

Read more here.

Source: The Economist