by Max Barry

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by The Despotic Dictatorship of Despoticania. . 289 reads.

Despoticanian economy

The Despoticanian economy operates under one of the purest examples of Linkstate capitalism in history. Despite having a nominally free market, approximately 80 % of the Despoticanian economy is under state ownership, usually in the form of for-profit state-owned companies. Almost all industries - most notably arms manufacturing, mining and advanced human enhancement research - deemed crucial for the economy are required, by law, to remain under state ownership, but the state also has a long-standing habit of buying the majority share of most privately founded companies that grow big and important enough. In addition, the state remains a minority shareholder with working control over several smaller but promising companies. Due to their superhuman intelligence, The Despot and his AI assistants are usually able to predict which industries and companies are about to rise well in advance and act accordingly. Completely private companies do exist, but they tend to be relatively small and of secondary importance to the economy at large.

Since the profits from state-owned companies are the most important source of income for the state, Despoticania has no income tax whatsoever. The only existing taxes are sales taxes and tariffs on certain imported goods deemed unimportant for the economy. Because of this, Despoticania has traditionally been seen as a tax haven, which has brought in many super-rich individuals.

The Despoticanian economy is based on a combination of heavy construction industry, information technology, biotechnology and high-tech manufacturing. While Despoticania has traditionally been - and still is - socially and politically isolationist, Despoticanian traders have been a common sight in ports all across the world for millennia. At present, the most important exports are electronics, computer software, automobiles, high-tech weapons, tailored memes, refined uranium, nanotechnology, cybernetic implants and web hosting services. The most important imports are luxury foods, refined iron, refined copper, genetic templates, magical items, art, industrial chemicals, spacecraft components and refined petroleum.

One notable feature of the Despoticanian economy is the massive unemployment (approximately 58 % in 2017) caused by high levels of automation. The state is easily rich enough to provide adequate welfare for its unemployed population, but the social tensions caused by unemployment remain one of the greatest problems of Despoticania. Some rather unconventional means to mitigate these problems have sprung up in recent years, most notably the so-called Heaven Simulation.