Dr Krugman, a science-fiction fan, ponders how trade might work between two widely separated planets, Earth and Trantor. Such trade will be affected by relativity theory, which shows that beings on Earth (or Trantor) will see time pass at a different speed from those who are on board cargo ships moving between the two. This could make it hard to calculate the net present value of a shipment. And the fact that messages can move at best at the speed of light (and cargoes more slowly still) might do odd things to the ability to arbitrage between the economies of the two worlds.

After working through the maths, Dr Krugman came up with two fundamental theorems of interstellar trade. The first is that interest costs on travelling goods should be calculated using clocks on planets, not ships. This is because the opportunity cost of trade—buying a bond on Earth (or Trantor), say—is calculated using planet-bound clocks, regardless of what relativity does to a businessman travelling alongside his cargo.

The second theorem states that, though long travel times mean prices on trading planets will never reach parity, interest rates will. If they differed, then investors could buy bonds on the more attractive planet, driving its rates back to parity with those on its trading partner.

More here, hat tip to Tyler Cowen. I would love to take a course on robot economics, which might have more near-term value in my life, but interstellar economics would be a honeypot for me, too.