Sunday, May 30, 2021

Hayek's Mistake: The Ancient Evolution of the Human Trading Instinct and the Neanderthal Extinction

I have often argued against Friedrich Hayek's claim that socialism appeals to our evolved instincts, as shaped by our evolutionary history in hunter-gatherer bands, and therefore that capitalism requires a cultural repression of those natural instincts.  In making that argument, I have disputed the common assumption that the "mismatch" theory of evolutionary psychology supports Hayek's claim.

Contrary to Hayek's assertions, I have contended that evolutionary anthropology sustains the conclusion that a capitalist liberal culture appeals to the evolved human instincts for social exchange or trade and for the liberty expressed as resistance to oppression that can be seen in hunter-gatherer bands.  Adam Smith was right to see that the "system of natural liberty" is rooted in our innate instincts and that the opulence that results from exchange and specialization is the necessary consequence of "a certain propensity in human nature . . . the propensity to truck, barter, and exchange one thing for another."  

Some of my previous posts on this can be found here,  here., herehere, and here.

Contradicting Hayek's claim that there is no evidence for human trade until the last few thousand years, recent research has found fossil evidence for long-distance trade reaching back as far as 300,000 years ago in Africa.  

If Homo sapiens were free traders when they migrated out of Africa and into Europe, where they met the Neanderthals, this might explain the extinction of the Neanderthals, because they were not traders.

Nevertheless, there might be some partial truth to Hayek's thought that the instinctive tribalism of  human beings makes it hard for them to live as free traders in an open and globalized society.  As Paul Rubin has observed, the "folk-economics" of ordinary people often show a failure to understand the non-zero sum character of free market exchange as mutually beneficial to all participants in the market. 


By the 1980s and 1990s, there was an extensive archeological record for long-distance trade in the Later Stone Age (or Upper Paleolithic) from 50,000 to 12,000 years ago.  This was the period with evidence for sophisticated art, ornamentation, and new hunting and gathering technologies that were markers for "behaviorally modern humans."

Archaeological sites dated to this time contain "luxury" items such as amber and seashells that had to be imported or traded from hundreds of kilometers away (Harrold 1988; Mussi and Roebroeks 1996; Weniger 1989, 1990).  Also, the stone used to make tools was transported over great distances.  In some cases, most of the flint would have had to be imported from 100 to 300 kilometers away (Schild 1984; Soffer 1985).

More recently, the archaeological evidence for trade has been extended back into the Middle Stone Age from 320,000 to to 50,000 years ago.  This was the period in which "anatomically modern humans" (Homo sapiens) first appeared.  So this would be evidence for trade being deeply rooted in human evolutionary history.

Some of the best of the evidence comes from Middle Stone Age sites in the Olorgesailie basin in southern Kenya, dating from 320,000 to 295,000 years ago (Brooks et al. 2018; Deino et al. 2018; Potts et al. 2018).  Archaeologists have found there specialized tools, spear tips, scrapers, and awls.  They are made of obsidian, a black volcanic glass that is easily fractured to produce sharp cutting tools and weapons.  The volcanic sites for this obsidian are far away from Olorgesailie, up to 88 kilometers away.  The people of Olorgesailie could have travelled to these distant sites.  But it's more likely that they were part of some long-distance trade networks, in which they exchanged other goods for the obsidian they wanted.  Other evidence for such trade networks is that they used colorful rocks for dyes that had to be imported from far away.

This looks like evidence for Smith's "propensity to truck, barter, and exchange one thing for another" appearing 300,000 years ago.


The Neanderthals survived in Europe for more than 200,000 years, until they disappeared from the fossil record around 40,000 years ago (Higham et al. 2014).  Humans migrated out of Africa and reached northwestern Europe sometime around 44,000 to 42,000 years ago (Higham et al. 2011).  So Neanderthals and humans overlapped in Europe for 4,000 to 2,000 years, and during that time they engaged in some interspecies boinking, as indicated by the fact that the human genome today contains some Neanderthal genes (Paabo 2014).  But despite this carnal coexistence, the fact that the Neanderthals went extinct a few thousand years after the arrival of humans suggests that the humans had some competitive advantage over them.  One possibility is that human trading behavior favored the humans over the Neanderthals.

In contrast to humans, Neanderthal tools have been found close to their sites of origin, so there is no evidence for long-distance trade.  Neanderthals also show little division of labor: when they went hunting for large game, the whole group--men, women, and children--were involved.  Humans showed a more advanced division of labor, in which men hunted large game, and women and children gathered wild plants and prepared the food, as indicated by the fact that men were often buried with spears and arrowheads, while women were buried with grinding tools (Horan et al. 2005; Kuhn and Stiner 2006).

We can infer from this that the greater exchange and division of labor among humans gave them many evolutionary advantages.  They had a greater supply of resources and food, and they probably exchanged ideas as well as goods and services in extensive networks of widely dispersed groups, so that they gathered more information and developed more innovations, which would explain the greater social and technological complexity of humans compared with Neanderthals.  This was the beginning of globalization and free trade.


But even if this refutes Hayek's belief that the extended open social order made possible by trade requires a Freudian repression of our tribalist instincts for living in a closed society, many human beings show an instinctive emporiophobia--or "fear of markets"--because they cannot understand the fundamental idea in economics of the gains from trade.  Many people cannot understand how any voluntary exchange of one thing for another makes both sides better off, because they assume that such exchanges must be zero-sum: if one side wins, then the other side loses.  If the rich get richer from trade, the poor must get poorer.  That's the logic of the Marxist theory of free trade as necessarily exploitative.

Oddly, however, while many people agree with Donald Trump that "trade is bad," and so Americans need protectionist restrictions on trade to stop the Chinese from exploiting America by selling cheap goods in American markets, these same people are happy to shop for Chinese goods at their local Walmart.  

As I have suggested in a previous post, although the folk-economic beliefs of ordinary people often show fear of markets, the economic behavior of these people shows their practical understanding of the gains from trade in free markets.


Brooks, Alison S., et al. 2018. "Long-Distance Stone Transport and Pigment Use in the Earliest Middle Stone Age." Science 360: 90-94.

Deino, Alan L., et al. 2018. "Chronology of the Acheulean to Middle Stone Age Transition in Eastern Africa." Science 360: 95-98.

Harrold, F. B.  1988. "The Chatelperronian and the Early Aurignacian in France." British Archaeological Reports International Series 437: 157-191.

Higham, Tom, et al. 2011. "The Earliest Evidence for Anatomically Modern Humans in Northwestern Europe." Nature 479: 521-524.

Higham, Tom, et al. 2014. "The Timing and Spatiotemporal Patterning of Neanderthal Disappearance." Nature 512: 306-309.

Horan, Richard D., et al. 2005. "How Trade Saved Humanity from Biological Exclusion: An Economic Theory of Neanderthal Extinction." Journal of Economic Behavior and Organization 58: 1-29.

Kuhn, Steven L., and Mary C. Stiner.  2006. "What's a Mother to Do? The Division of Labor among Neandertals and Modern Humans in Eurasia." Current Anthropology 47: 953-980.

Mussi, M., and W. Roebroeks. 1996. "The Big Mosaic." Current Anthropology 37: 697-699.

Paabo, Svante. 2014. Neanderthal Man: In Search of Lost Genomes. New York: Basic Books.

Potts, Richard, et al. 2018. "Environmental Dynamics During the Onset of the Middle Stone Age in Eastern Africa." Science 360: 86-90.

Schild, R. 1984. "Terminal Paleolithic of the North European Plain: A Review of Lost Chances, Potential, and Hopes." Advances in World Archaeology 3: 193-227.

Soffer, Olga. 1985. The Upper Paleolithic of the Central Russian Plain. Orlando, FL: Academic Press.

Weniger, G. 1989. "The Magdalenian of Western Central Europe: Settlement Pattern and Regionality." Journal of World Prehistory 3: 323-372.

Weniger, G. 1990. "Germany at 18,000 BP." In The World at 18,000 BP. Vol. 1, High Latitudes, ed. O. Soffer and C. Gamble, 171-192.  London: Unwin Hyman.


Xenophon said...

Adam Smith would also disagree with Hayek, as indicated by the very beginning chapter of The Wealth of Nations:

"The division of labour arises from a propensity in human nature to exchange. derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual, consequence of a certain propensity in human nature which has in view no such extensive utility; the propensity to truck, barter, and exchange one thing for another.

Whether this propensity be one of those original principles in human nature, of which no further account can be given; or whether, as seems more probable, it be the necessary consequence of the faculties of reason and speech, it belongs not to our present subject to enquire. It is common to all men, and to be found in no other race of animals, which seem to know neither this nor any other species of contracts. Two greyhounds, in running down the same hare, have sometimes the appearance of acting in some sort of concert. Each turns her towards his companion, or endeavours to intercept her when his companion turns her towards himself. This, however, is not the effect of any contract, but of the accidental concurrence of their passions in the same object at that particular time. Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog. Nobody ever saw one animal by its gestures and natural cries signify to another, this is mine, that yours; I am willing to give this for that...."

Question: Is there any evidence at this time of "exchange" in other animals?

Larry Arnhart said...

I wrote about this on 5-31-12.