Homo Hatfieldicus

December 10, 2008

Collective action problems are notoriously difficult to solve for a group of individualistic, rational, utility maximizers. Fortunately, that’s not what we are. The irrational impulse for revenge, it turns out, is a phenonenon with economic significance, as highlighted by Steven Landsburg in More Sex is Safer Sex, Pete Leeson in his lectures on anarchy, and today in an article by Ron Bailey for Reason magazine.

Revenge is odd because it implies that people are willing to spend their own resources in order to punish people who are seen as non-cooperators. By a strict definition of rationality, this is irrational, since I should never be willing to spend resources for which I will receive nothing in exchange. And you being worse off is not something that benefits me.

As Landsburg points out, this isn’t really surprising unless you are a classical economist. A perfectly rational agent is terrible at cooperative games, because he can never credibly threaten to punish non-cooperation. Anyone playing against him will know that he will never punish at any cost to himself. With no fear of reprisal, no one will cooperate with him when given the chance to betray his trust. An irrational person with a taste for revenge will get much better results in such games, since his threat of punishment is credible (he enjoys punishing non-cooperation, so he’ll likely engage in it). Since we’re involved in cooperation games all the time, it makes sense that as a species we’d have characteristics that would make us not terrible at playing them.

Leeson and Landsburg point to the Hatfield and McCoy feud as an example of this impulse spiraling out of control. Basically, their threat amounted to “If you violate our cooperation agreement, I will punish you, and your children, and their children, and their children’s children…” This, unfortunately, turned out to be more than just cheap talk. Cooperation became impossible for the families, but not because they were too thoroughly rational and self-interested.

The most important task for defenders of anarchy is to take the mystery out of government by explaining what it is and what it does. The arguments for government that I respond to on this blog are straw men because the arguments put forth by most defenders of government are straw men. Most people just haven’t thought about government very much; they see it as a magical black box that protects our property and keeps us from killing each other. But law and order are public goods whose production is constrained by a collective action problem. Through the kind of research described by Leeson and Ron Bailey, anarchists try to show that we’re not as bad at producing public goods as non-anarchists think. Through Public Choice economics, anarchists try to show that government isn’t as good or efficient at producing public goods as non-anarchists think.

Am I saying that perpetual war, as between the Hatfields and McCoys, is better than government? No. But I would love it if we could even get this far in the debate. First, let’s acknowledge that government is not the only solution. Then we’ll talk about whether it’s the best solution.

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