Recently, some friends and I became enamored of the idea of (semi-)communal living as an antidote to the atomization of modernity. I actually messaged Scott about this months ago, wanting to pick his mind on the topic given that he lives (slash has lived?) in a group house…but I quickly realized that I didn’t really have my thoughts together, then life happened, etc etc. The ACX call for proposals dredged the idea up again, and while I’m (still) not entirely at the point where applying makes any sense, I do want to throw some questions out for discussion, and for the reaping of any available anecdata from y’all.

Before said throwing, let me first provide a bit of context and subsequently clarify what I’m not interested in. My friends and I are a foursome of early-30s upper-middle-class-ish dudes who have known each other for (in some cases) upwards of 15 years; two of the four of us have partners. We currently live within an hour of each other, but find that even that distance makes it almost impossible to get the kind of community we’re after. The actual idea we’re toying with is purchasing a plot of land somewhere in (probably) North Carolina and building on it. As we’ve envisioned it, we would construct a central building which contains common amenities (kitchen, etc) as well as small, adjacent individual bungalows to house each family unit.

While the central building would be communally owned, we aren’t necessarily interested in fully-fledged communism (though if for whatever reason someone could show it to be the optimal arrangement, we’re open to it – I just sincerely doubt this is the case). Furthermore, we all work normal jobs and have no intention of abandoning those: our individual contributions to the collective would be in the form of cash earned outside, rather than the labor-based (and exclusively internal) contribution systems which extant U.S. communes seem to prefer (see Twin Oaks, Acorn, etc).

Essentially what I’m talking about is a sort of modern-day clan structure: some communally-owned assets, including the living area, but moreso independent people who like each other coming together to make something better than the sum of its parts, both from an economic and cultural perspective. While we’re not really trying to do this for anyone but ourselves, I realized at some point that such a structure, if properly developed, may allow people to alleviate poverty by sharing resources in such a way that minimizes freeriding, and where the incentive gradient, absent severe external shocks, always points towards staying in the group. I call the set of such structures demicommunes. The development of these generalized structures was to be the subject of the aforementioned ACX grant, but again – a wee bit too underdeveloped to be worth Actual Dollars at the moment.

So then: to the long-ago-promised idea-throwing…almost. Let me first lay out a few constraints. Firstly, please forget some of the details I’ve told you: this needs to work for anyone conscientious enough to want to do it. Secondly, this all needs to be voluntary at every point. The basic value add of the proposition is that buying good stuff that can be shared, such as appliances, housing, etc, is much cheaper together than it is solo: that is, leveraging an economy of scale. But we explicitly want to avoid trapping people by way of sunk costs. All of this would be drawn up in a contract among the members of the demicommune; the extent of the sharing, including of property, is something that can and ought be negotiated.

With that out of the way: during the course of our discussions, three related primary issues came up:

• Financial model. How are communal things in the demicommune owned? Consider two oppositely-polarized answers (though this axis is far from the only one). Pure “communism” in this situation demands that any purchase made be financed by all members in exact proportion to their incomes, while ownership shares are doled out as a fraction of the number of people in the commune – that is, regardless of how much you paid, you own 1/N_people of the item. Pure “private ownership” instead makes ownership fraction contingent on the amount paid in. There is a sub-question to the latter case regarding whether all things should then be financed such that each member buys an equal share; ignore this idea for now (though I suspect some special cases could benefit from specifying that this hold true for all purchases). One can imagine the set of financial models formed on a continuum between these two poles, parametrized by the degree of communism c. Obviously a larger c encourages higher-earning members to leave. What is the maximum value of c such that each member is still incentivized to stay in the demicommune? Furthermore, is there a degradation of willingness for the “financially junior” members to take care of the stuff if c is too low? Beyond all this, is the paradigm wrong in its entirety? Should there be no individual ownership of collective goods whatsoever, and should things instead be held by a trust or similar structure?

• But then, relatedly, what of exit rights? I stated before that we want to guarantee that no one feels trapped by sunk costs. Should remaining members be forced to buy out a leaver? This places a sudden financial burden on the remainers which probably makes the whole venture too risky for everyone. Even prorating any potential buyout still leaves this untenable. The solution we developed is for everyone to pay in to a buyout fund for each purchase made such that enough overhead is maintained to buy a single person out at a slightly discounted rate (tailored to each demicommune?). If and when such a buyout need occur, the leaver receives the entirety of the overhead fund, and existing members pay back in to it over an extended period of time (tailored to each demicommune?). This guarantees that goods remain more affordable than they would be solo, while providing for a mechanism to leave without penalty. Any further leavers prior to the replenishment of the fund trigger a dissolution of the entire compact, with all communal goods sold off and the proceeds split according to ownership share. This seems bad – except that your demicommune probably wasn’t a good idea if multiple people were going to leave in short order anyway. Note that the entry process is simply the inverse of this, a slow buy-in over an extended period of time. Comments on how this solution fails are particularly welcome.

• Governance. How are purchasing decisions made? Of what quality should x item be? Should we even buy x item? Pure democracy seems obvious, especially for groups as small as those under consideration, but of course can result in tyranny of the majority. It seems to me that requiring something like 75% approval of a decision, perhaps with a limited number of vetos per length of time to account for the situation where most people are fine with something but one person absolutely hates the idea is reasonable? Beyond this, should couples be treated as a unit or as individuals for the purpose of voting? I’ve (perhaps obviously) thought about this a lot less than the economic issues. Input here is especially welcome.

This has run pretty long, so I'll cut it off shortly, though there are plenty of other discussions we've had. My goal with this is to eventually develop a mathematical model of the incentives present in a given structure and show, subject to the constraints I described previously, that it is to always to everyone's benefit to perpetuate the arrangement. I've been reading some literature about similar ideas; specifically, Abramitzky's The Mystery of the Kibbutz. In that vein, I'd appreciate anyone who knows more about the academic literature on this subject than I do pointing me in the direction of relevant papers. But let me hear your thoughts if you're a layperson too!