Layer Two — Models

Models and formula registry

Every formula published anywhere in this project is defined once, here. Specification chapters, formula cards, and interactive calculators all read from this registry, so a figure on the site and a figure in the specification cannot drift apart.

Model results are not predictions. Inputs at alpha stage are largely estimated rather than measured, compounding models are highly sensitive to assumed success rates, and no model here has completed independent review. See Model Limitations.

Interactive simulations

Formula registry

NVC

Net Value Created

Research

Records what a transaction produced, net of what it consumed and what it imposed on others.

NVC = VP - VC + E - R

net value created = value produced − verified costs + positive externalities − risks

Variables

  • VPValue produced (currency)
  • VCVerified costs (currency)
  • EPositive externalities (currency)
  • RRisks and negative externalities (currency)

Assumptions

  • Value produced, externalities, and risks are estimated rather than observed.
  • Estimates are comparable only when produced by the same disclosed method.
  • Components are additive; interaction effects are not modelled.

Limitations

  • Externality estimates are the weakest input and dominate disagreement.
  • No independent verification exists at alpha stage.

ExampleA $500 purchase producing $6,000 of buyer value against $300 of cost and $200 of risk gives NVC = $5,500.

TVR

Total Value Received

Research

Sums the value each party to a transaction actually received.

TVR_{recv} = V_{buyer} + V_{seller}

total value received = buyer value + seller value

Variables

  • V_buyerValue received by the buyer (currency)
  • V_sellerValue received by the seller (currency)

Assumptions

  • Both parties report on the same disclosed method and time horizon.

Limitations

  • Self-reported at alpha stage; no third-party verification.

Example$6,000 buyer value plus $1,500 seller value gives $7,500 received.

SURPLUS

Value Surplus

Research

Shows how much value a transaction produced beyond the amount exchanged.

S = TVR_{recv} - P

surplus = total value received − price

Variables

  • TVR_recvTotal value received (currency)
  • PTransaction price (currency)

Assumptions

  • Price is the complete settlement amount, including fees.

Limitations

  • A large surplus may reflect an optimistic value estimate rather than a good transaction.

Example$7,500 received on a $500 price gives a $7,000 surplus.

EFF

Value Efficiency

Research

Expresses value received per unit of price so transactions of different sizes can be compared.

\eta = \frac{TVR_{recv}}{P}

value efficiency = total value received ÷ price

Variables

  • TVR_recvTotal value received (currency)
  • PTransaction price (currency)

Assumptions

  • Price is greater than zero.
  • Value horizon is stated and identical across compared transactions.

Limitations

  • Highly sensitive to the hourly rate used to value time saved.

Example$7,500 received on a $500 price gives η = 15.

IVS

Intelligent Value Score

Research

Maps value efficiency onto a bounded comparative scale for transactions and projects.

IVS = \frac{100}{1 + e^{-k(\eta - \eta_0)}}

a bounded 0–100 indicator derived from value efficiency

Variables

  • \etaValue efficiency (ratio)
  • \eta_0Reference efficiency (ratio)
  • kCurve steepness (dimensionless)

Assumptions

  • Reference efficiency and steepness are published and versioned.

Limitations

  • Must never be applied to a person, used as a credit gate, or used to determine rights.
  • Bounded output can imply more precision than the inputs support.

ExampleWith η = 15, η₀ = 5 and k = 0.2, IVS ≈ 88.

PPI

Purchasing-Power Index

Research

Defines stability as the purchasing power of a published basket rather than an exchange rate.

PPI_t = \frac{\sum_i w_i p_{i,t}}{\sum_i w_i p_{i,0}}

weighted basket price now ÷ weighted basket price in the base period

Variables

  • w_iPublished weight of basket item i (dimensionless)
  • p_{i,t}Price of item i at period t (currency)
  • p_{i,0}Price of item i in the base period (currency)

Assumptions

  • Basket composition, weights, and sources are published before use and versioned on change.

Limitations

  • A basket that can be quietly reweighted is a mechanism for hiding inflation.

ExampleA basket costing 104 against a base of 100 gives PPI = 1.04.

CAPREC

Capital Recycling

Draft

Models how returned project capital funds subsequent institutional deployment.

C_{n+1} = C_n \times r \times s

next-cycle capital = deployed capital × institutional return share × success rate

Variables

  • C_nCapital deployed in cycle n (currency)
  • rInstitutional return share (ratio)
  • sSuccess rate of funded projects (ratio)

Assumptions

  • Project profit is measurable and agreements are enforceable.
  • Success rates are stable across cycles.

Limitations

  • Extremely sensitive to the success rate; small errors compound.
  • Institutional overhead, fraud, and selection bias are unmodelled.
  • Outputs are illustrative, never predictions.

Example$100M deployed at r = 0.9 and s = 0.4 returns $36M for the next cycle.

RC

Reserve Coverage

Research

States whether a proposed unit of account can meet redemption under a published stress scenario.

RC = \frac{\text{Liquid reserves}}{\text{Redeemable liabilities under stress}}

reserve coverage = liquid reserves ÷ redeemable liabilities under stress

Variables

  • ReservesLiquid reserve assets (currency)
  • LiabilitiesRedeemable liabilities under the stress scenario (currency)

Assumptions

  • Stress scenario, asset liquidity classifications, and redemption terms are published.

Limitations

  • Correlated stress across reserve assets is not captured by a single ratio.

Example$1.20 of liquid reserves per $1.00 of stressed liabilities gives RC = 1.2.

PROSP

Prosperity Function

Research

Candidate formulation of system-wide prosperity beyond nominal output.

P = \sum_i w_i \cdot \frac{c_i}{c_i^{*}}

prosperity = weighted sum of measured capability against reference levels

Variables

  • c_iMeasured capability in domain i (domain-specific)
  • c_i^*Published reference level for domain i (domain-specific)
  • w_iPublished weight for domain i (dimensionless)

Assumptions

  • Capability domains are separable.
  • Weights are set by a disclosed, versioned procedure.

Limitations

  • The weighting procedure is unresolved and is the framework's largest open problem.
  • Distributional effects are not captured by the aggregate.

ExampleIllustrative only; no validated weights exist at alpha stage.

DP

Distributable Profit

Research

Establishes what a Universal Beneficial Income system may distribute in a period, after every prior obligation is funded.

DP_t = \max(0,\; R_t - O_t - B_t - C_t - S_t)

distributable profit = qualifying revenue − operating cost − essential benefits − reinvestment − reserve funding

Variables

  • R_tQualifying system revenue in period t (currency)
  • O_tVerified operating cost (currency)
  • B_tEssential-benefit budget (food, housing, utilities) (currency)
  • C_tRequired capital reinvestment (currency)
  • S_tRequired reserve and stabilization funding (currency)

Assumptions

  • Revenue is audited and attributable to the distributing system.
  • Essential benefits are funded before any cash distribution.
  • Distribution is never funded by borrowing.

Limitations

  • Revenue at the scale the framework assumes has never been demonstrated.
  • Cost categories overlap in practice and require an accounting standard that does not yet exist.

ExampleRevenue of $1.8T against $300B operating, $420B benefits, $260B reinvestment, and $120B reserves gives DP = $700B.

DIV

Citizen Dividend

Research

Divides the approved portion of distributable profit equally across every eligible citizen for the period.

D_t = \alpha \cdot \frac{DP_t}{N_t}

citizen dividend = approved distribution share × distributable profit ÷ eligible citizens

Variables

  • D_tAnnual distribution per eligible citizen (currency)
  • \alphaApproved citizen-distribution percentage (0–1)
  • DP_tDistributable profit in period t (currency)
  • N_tEligible citizens in period t (count)

Assumptions

  • Every eligible citizen receives an identical amount.
  • α is set publicly in advance and cannot be changed retroactively.
  • The remaining (1 − α) is retained as productive capital.

Limitations

  • An equal split ignores regional cost-of-living differences.
  • The dividend varies with system performance and cannot be guaranteed as a fixed amount.

Exampleα = 0.75 applied to $700B across 340M citizens gives about $1,544 per citizen per year.

PSR

Prosperity Stabilization Ratio

Research

Determines whether a distribution may be released at full rate, reduced, or suspended in favour of essential benefits.

PSR = \frac{\text{Liquid Reserves}}{\text{Projected 12-Month Core Obligations}}

reserve ratio = liquid reserves ÷ the next twelve months of core obligations

Variables

  • PSRCoverage of core obligations by liquid reserves (ratio)
  • Liquid ReservesReserves callable within the period (currency)
  • Core ObligationsFood, housing, utilities, account operations, and committed payments (currency)

Assumptions

  • Core obligations can be projected twelve months ahead with acceptable error.
  • Reserves are genuinely liquid and unencumbered.

Limitations

  • A shock that moves revenue and obligations together degrades the ratio faster than it predicts.
  • Threshold bands are conventions, not derived values.

ExampleReserves of $700B against $560B of projected core obligations gives PSR = 1.25 — adequate.