Thursday, April 01, 2010

Markets and World Religions in the Evolution of Cooperation

Explaining the evolution of large-scale human societies is one of the fundamental problems in the social sciences. Looking at the deep history of human social life, two turning points towards bigger societies are evident--the ancient emergence of agrarian states and the modern commercial/industrial revolution.

Until about 10,000 years ago, human beings lived in small foraging groups limited to no more than a few hundred individuals. Then, with the beginning of the Holocene epoch, warmer and more stable climates allowed for the emergence of larger, sedentary societies. The domestication of plants and animals supported the development of agrarian states with hundreds of thousands of members.

Over the past three hundred years, modern commercial and industrial societies have supported huge populations of millions of people, along with global networks of exchange that embrace billions of human beings.

The question is, what makes it possible for such large groups of strangers to cooperate with one another? In foraging societies, individuals cooperate with kin or with known individuals bound together by ties of reciprocity and reputation. Evolutionary theories of cooperation often stress the innate psychology of kinship and reciprocity. But it's not clear whether this can explain the cooperation of large groups of strangers.

One line of research is to explain this as a result of social history in which social norms for acting fairly and punishing unfairness have been favored in cultural group selection. A recent example of such research is an article by Joseph Henrich et al., "Markets, Religion, Community Size, and the Evolution of Fairness and Punishment," in Science, 327 (March 19, 2010): 1480-84.

The full article is available online only to subscribers. But here is the abstract:

"Large-scale societies in which strangers regularly engage in mutually beneficial transactions are puzzling. The evolutionary mechanisms associated with kinship and reciprocity, which underpin much of primate sociality, do not readily extend to large unrelated groups. Theory suggests that the evolution of such societies may have required norms and institutions that sustain fairness in ephemeral exchanges. If that is true, then engagement in larger-scale institutions, such as markets and world religions, should be associated with greater fairness, and larger communities should punish unfairness more. Using three behavioral experiments administered across 15 diverse populations, we show that market integration (measured as the percentage of purchased calories) positively covaries with fairness while community size positively covaries with punishment. Participation in a world religion is associated with fairness, although not across all measures. These results suggest that modern prosociality is not solely the product of an innate psychology, but also reflects norms and institutions that have emerged over the course of human history."

The three experimental games that they used are the Dictator Game, the Ultimatum Game, and the Third-Party Punishment Game.

What they call "World Religion" is identification with either Islam or Christianity, as opposed to practicing a tribal religion or no religion.

They performed their experiments "with 2148 individuals across populations from Africa, North and South America, Oceania, New Guinea, and Asia that included small-scale societies of hunter-gatherers, marine foragers, pastoralists, horticulturalists, and wage laborers" (1482).

This study raises lots of questions. First, what is the relationship between "market integration" and "world religions"? They might be interdependent. For example, some scholars argue that one reason for the rapid expanse of Islam was that Islamic believers developed extensive trading networks based on the trust they had in one another as fellow believers with shared norms of fairness.

On the other hand, if markets and world religions are separable in their fostering cooperation, then social cooperation in large societies might be based on an ethos of market exchanges without religious belief. When Henrich speaks of markets as fostering cooperative relationships, he cites Adam Smith's Theory of Moral Sentiments. Does this imply that the evolution of natural moral sentiments might sustain cooperation even without religious belief?

This anthropological research seems to confirm what Smith said in his Lectures on Jurisprudence about the influence of commerce on the morals of a people.  "Whenever commerce is introduced into any country," Smith observes, "probity and punctuality always accompany it.  These virtues in a rude and barbarous country are almost unknown."  That explains why the Dutch, as the most commercial people, have the best reputation for honesty.  It's a matter of self-interest in maintaining a good reputation.  "A dealer is afraid of losing his character, and is scrupulous in observing every engagement.  When a person makes perhaps 20 contracts in a day, he cannot gain so much by endeavoring to impose on his neighbors, as the very appearance of a cheat would make him lose.  Where people seldom deal with one another, we find that they are somewhat disposed to cheat, because they can gain more by a smart trick than they can lose by the injury which it does to their character."  Smith concludes: "When the greater part of people are merchants, they always bring probity and punctuality into fashion, and these therefore are the principal virtues of a commercial nation" (LJ, 538-39). 

The value of having a good reputation for being trustworthy in voluntary exchanges enforces customary norms of good conduct.  There are many examples in economic history of how important such reputational effects can be in fostering voluntary cooperation (see Daniel B. Klein, ed., Reputation: Studies in the Voluntary Elicitation of Good Conduct [Ann Arbor: University of Michigan Press, 1997]).

Henrich is suggesting that markets fostered cooperation based on norms of fairness from the beginning of agrarian societies 10,000 years ago. But one wonders whether the modern commercial society defended by Smith introduced a new kind of market moral psychology that made possible the commercial/industrial revolution of the last few centuries. Karia Hoff wrote a commentary on Heinrich's article for the same issue of Science, and she cites Joel Mokyr's new book on the British industrial revolution--The Enlightened Economy--as showing how businessmen developed informal norms of trust and fairness that fostered commercial and technical cooperation. Does this suggest that the "spirit of capitalism" can sustain moral norms of cooperation even without religious belief?

And what exactly is it about religious belief that supports norms of fairness? Henrich implies that the Abrahamic religions--such as Christianity and Islam--secure cooperation among strangers better than tribal religions. But he doesn't explain why. In some other writings, Heinrich and others have referred to the "moralizing gods" of the Abrahamic religions as important--the idea that God is a moral lawgiver who monitors human behavior and punishes bad behavior. Is that all that's required? In other writings, Heinrich has argued that the more strict religions that require costly sacrifices from their believers are more effective in enforcing good behavior, because such "costly signaling" separates the committed believers from the freeloaders. So, for example, Mormons are more "prosocial" than Methodists, because Mormonism is a stricter religion that demands more "costly signalling" than Methodism.

Much of this research shows that religious believers--at least those who worship "moralizing gods"--are more cooperative with those in their group. But it's not clear that this extends to those outside their group. After all, the very idea of evolutionary group selection, which underlies Heinrich's study, is that individuals cooperate with members of their group to compete with those outside their group. And, of course, the history of religion is to a large extent a history of religious warfare. It is true that "world religions" like Christianity and Islam can extend their group membership around the world. But still the history of conflict between Christians and Muslims is a reminder of the limits of religious norms of fairness. Or should it be possible for at least the Abrahamic religions--Judaism, Catholic Christianity, Protestant Christianity, Islam, and Mormonism--to find shared norms of cooperation based on their shared belief in a moralizing God?

More questions are raised by Henrich's assumption that both market integration and world religions are products of cultural evolution rather than genetic evolution. He stresses this when he says that when researchers employ behavioral game-theory experiments with people in industrialized societies, the behavior they see is not providing direct access to human nature. Rather, it is showing the consequences of socially learned norms that have evolved culturally, although this cultural evolution must somehow tap into human genetically evolved psychology.

It is often assumed that evolutionary studies of human society look to genetic rather than cultural explanations. But this work by Henrich illustrates the current trend among evolutionary theorists towards coevolutionary explanations of the interaction between genetic evolution and cultural evolution.


Anonymous said...

Interesting post and study.

In addition to your well-stated points, it strikes me that any study – irrespective of statistical significance - that uses the results of three standardized psychology “games” with only 2000 participants is at best hypothesis generating.

For example, this could easily say as much about the type of persons in the particular societies that agree to participate as it does about what the average person in such a society truly thinks about “fairness and punishment.” And, naturally, while we can move across space, we cannot across time.

The how and why behind the radical and continuing economic changes of the last two centuries are fascinating questions. It often seems to me that economists bring an incomplete understanding of politics, ethics, and man as man to bear (the nod to “institutions” without analysis notwithstanding), while philosophers and political scientists often ignore the issue entirely.


Troy Camplin said...

At the same time, it seems like they are at least partially confirming F.A. Hayek's theory of spontaneous order emergence. Like Arnhart, I think that Hayek needs a good dose of evopsych for correction, but that doesn't mean that he isn't basically correct about spontaneous orders. I see this as an important beginning of real scientific research into spontaneous order formation.