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168 sats \ 2 replies \ @Undisciplined 13 Jan \ on: reinforcing feedback loop econ
It's kind of funny to me that we have all these different names, when all three of the processes you mention are just examples "positive feedback".
Like you illustrate, the colloquial usage is trying to better capture the feel of the thing and it sounds weird to most people to describe something like a "fiscal death spiral" as a "positive feedback loop". You can't call it a "negative feedback loop", though, because that means something else.
It's a good example of positive (yet another usage) and normative butting heads.
Cool. You had me googling ‘fiscal death spiral’!
Isn’t it a bad thing though? In terms of government debt - When a government issues more debt than it can pay back, and interest payments grow larger. Why is it considered a positive feedback loop?
Thanks in advance!
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"Positive feedback cycles" aren't a good/bad category. Rather it's a description of the dynamics of a system.
Positive feedback just means the system reinforces or strengthens the effect: in a fiscal death spiral, the attempts to mitigate the problem actually make it worse.
Negative feedback means the system pushes back on the process. Sticking with fiscal metaphors, something like tax evasion is a negative feedback on raising taxes: i.e. states can't just raise taxes to increase revenue, because of the negative feedback from tax evasion.
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