Cliodynamica — A Blog about the Evolution of Civilizations
Naked Self-Interest is a Recipe for Social Dissolution (a response to Branko Milanovic)
Peter Turchin | Professor in the Department of Ecology and Evolutionary Biology at the University of Connecticut; Research Associate in the School of Anthropology, University of Oxford; and Vice-President of the Evolution Institute
ht Yves Smith at Naked Capitalism
See also John Maynard Keynes, The end of laissez-faire (1926)
Robert Frank: Ruthless self interest is not a good business strategy (a guest post)
Robert H. Frank is the Henrietta Johnson Louis Professor of Management and a Professor of Economics at the Samuel Curtis Johnson Graduate School of Management at Cornell University
Herbert Gintis: Societies whose business leaders have moral integrity are successful societies (a guest blog)
This essay, which was published as a pamphlet by the Hogarth Press in July 1926, was based on the Sidney Ball Lecture given by Keynes at Oxford in November 1924 and on a lecture given by him at the University of Berlin in June 1926.Also
Robert Frank: Ruthless self interest is not a good business strategy (a guest post)
Robert H. Frank is the Henrietta Johnson Louis Professor of Management and a Professor of Economics at the Samuel Curtis Johnson Graduate School of Management at Cornell University
Herbert Gintis: Societies whose business leaders have moral integrity are successful societies (a guest blog)
Herbert Gintis, Professor, Santa Fe Institute, Professor, Central European University, Economics,Emeritus Professor, University of Massachusetts, Economics
Branko Milanovic, formerly lead economist in the World Bank’s research department and currently is visiting presidential professor at City University of New York Graduate Center and an affiliated senior scholar at the Luxembourg Income Study
That's an excellent post that gets to the nub of the argument.
ReplyDeleteHowever I would argue as to whether public goods are 'costly'. They are only 'costly' where something else is stopped in the same time period. If you have an army of unemployed looking for something to do with no alternate bid then public goods are costless.
The view that businessmen should pursue "naked self-interest" from mainstream economics is a non starter IMO.
ReplyDeleteI think anyone with half a brain will agree that a society where all or most of the individuals were driven purely by self-interest would collapse, the author describes the early post-USSR Russia as a perfect example of what happens then. Hence if we argue that a subset of the population should pursue naked self-interest we are arguing that a subset of the population should be able to free ride the rest of society.
Imo this is a non-starter because it's unjust and unfair. Full stop. So from a pov of practical governance and reality this is just an stupid world-view disconnected from reality.
Now, if you don't care about fairness, then... But then you are arguing for social darwinism, and arbitrary rules customary to the ruling elite should not apply then, for example the "no violence (except from the state)" principle (narrowly defining what violence means and excluding many forms of violence).
If you argue for everyone for himself be consequential and accept the reality of warlordism and anarchy prevalent in some places in Asia and Africa instead of imposing random values because they are pro-status quo in developed nations.
It looks like to me that certain propositions are such to justify that a subset of the population can have the cake and eat it too.
"Now, if you don't care about fairness, then"
ReplyDeleteThe problem with fairness is that one person's fairness is another person's oppression.
The political process is how we agree what is 'fair'.
"Naked Self-Interest is a Recipe for Social Dissolution"
ReplyDeleteWell Duh. It's actually shocking to hear that this is considered a new topic in economics. These people need to get out more often.
"I think anyone with half a brain will agree that a society where all or most of the individuals were driven purely by self-interest would collapse"
That's progress, at least, and logic that was self-evident LONG before the formation of city states like Sumer, or even tribal societies ... or even the organization of family units predating homo sapiens.
This whole discussion is what, 1 million years behind the times. Seriously.
"The problem with fairness is that one person's fairness is another person's oppression."
ReplyDeleteSo? That's less than 2/3 of the negotiation that actually occurs. There are decidedly few homo sapiens today who aren't constantly aware of "what's good for [some] aggregate," regardless of family, neighborhood, firm, religion, ethnicity, nation, species, or whole planet.
For Pete's sake, Neil. There is no point of stability in the natural world that is not a dynamic equilibrium between multiple, conflicting forces or drives. Every 5 year old is aware of that, on some level. Otherwise they wouldn't be able to navigate routes, traffic & traffic lights, on their way to the candy store.
Most of the time, economic discussions seem hopelessly lost in the details, unable to see the dynamics for the imagined rules.
I also find shocking that the mainstream argument that "sociopathy is a desired behaviour to pursue to maximize economic outcomes" is not only contemplated, but apparently is the dominant posture.
ReplyDeleteScrew the rest of the society as long as the free riders can get their cake and eat it too! Clearly NOT a sustainable patterns in the rest of nature (neither in human societies which collapse if this is the dominant behaviour).