33 Comments

Re: "Nobel Laureate Gary Becker was a prominent figure in this economic imperialism. [... .] I am mostly interested in how psychology, sociology, and anthropology can inform economics, rather than the other way around."

There is but one social science — the study of human interdependence. One fruitful framework is 'methodological individualism.' Motivations and beliefs explain behaviors. Constraints and social mechanisms (e.g., the 'prisoners' dilemma') translate behaviors into unintended outcomes.

Academic disciplines (psychology, economics, etc) are institutions that shape piecemeal study of human interdependence. They structure local conversations, so to speak. The same is true for the study of nature (biology, chemistry, physics etc).

Academic disciplines shape-shift in pursuit of greater integration of knowledge. Here, for example, is a stylized wheel of disciplinary 'imperialism':

Psychology has partly become biology.

Biology has partly become chemistry.

Chemistry has partly become physics.

Physics has partly becomes mathematics.

Mathematics has partly become logic.

Logic has partly become psychology.

Psychology and economics should partly integrate (e.g., George Ainslie on 'hyperbolic discounting in choice').

Sociology and economics should partly integrate (e.g., Robert C. Ellickson on efficiency of dispute-resolution in close-knit groups).

And so on, with all disciplines, towards an integrated study of human interdependence. Presumably, there will remain room and need for local 'disciplinary' conversations — as well as fresh 'imperialisms'.

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Made me think of the famous xkcd cartoon:

https://xkcd.com/435/

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Thanks for the pointer. Yes, academics care a lot about (group) status! Hmmm, does a physicist at Boston University have greater status than a psychologist at Harvard?

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I have often thought to myself, perhaps incorrectly, that economics is just human psychology en masse. That phrase is likely an oversimplification, but human behavior is in no doubt connected with economics. The concept certainly breaks down with psychopathology (or does it😉).

Thank you for the way you connect anthropology, sociology, and similar to economics.

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Every time I see the term “rent-seeking” I think of a landlord and think of it as a critique of free market housing. I have to remind myself that, no, a landlord is not rent-seeking. A landlord is providing housing services. Then I think of passive investment income, and, no, that is not rent seeking. That is providing capital.

It happens every time, and I go through the same loop.

Is it rent-seeking when an official accepts a bribe to smooth over an odious bureaucracy? Seems to be in the eye of the beholder.

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For economists, "rent" is a technical term. It does not mean what a landlord collects. It means an excess profit. Economists tend to use "rent-seeking" to refer to what most people call "special interests." It is unfortunate that economists did not use a different term.

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Yes, a better term is needed for general use. I have been using "grift" and "grift-seeking," but maybe something better could be devised.

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Economic rent-seeking is not 'grift', though perhaps you are thinking of 'graft', which is closer but still not it. In contemporary American usage in the political context:

1. Grift is a politically-related agency-fraud strategy like a fake or corrupt "non-profit" in which one is swindling donors or voters by pretending that one is a good representative or advocate for their views and interests and using the money to further those goals, and do good works, only taking out a small and reasonable amount for a normal income and to cover overhead expenses while fulfilling the fiduciary obligation to keep those as low and the operation as lean and efficient as possible. The saintly ideal is distorted to some degree along at least one of those dimensions, in a spectrum ranging from diverting a little more money to oneself than justified, all the way to a complete con job only existing to maximize personal gain from the revenue one gets from suckers, while caring nothing at all about their interests or views, and even sometimes secretly working to undermine those interests. Like Hoffer said about causes, there is some kind of carcinization phenomenon in which the competitive pressure for scarce donations selects for the personalities and tactics most able to separate people from their money for nothing in return and causes these entities to all evolve into pure grifts or get outcompeted by them and go extinct.

2. Economic rent-seeking is lobbying politicians to use government power to

intervene in, regulate, or otherwise distort market conditions to be less competitive such that the lobbying entities will have the equivalent of greater market power to charge higher than unsubsidized, market-clearing prices, thus to capture excess profits by shifting surpluses from consumers to producers.

3. Graft is when a politician tries to abuse his position and powers in order to obtain personal gains. Politicians don't have to be lobbied to be motivated to do this, and if course it is illegal to """bribe""" them in the traditional ways, but there are all kinds of subtler ways to get the corruption done, and because it's so easy and common, the same kind of carcinization will happen in which politicians will eventually turn their whole office and career toward the purpose of "maximizing opportunities for graft", as Glenn Reynolds likes to put it.

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Grifting is getting money under false pretenses. Political rent-seeking always involves some specious moralizing cover in purported justification, which constitutes false pretense. So I include it in my use of the term.

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#2 is why I find it so funny (read: unfunny) that certain libertarian types, or so they consider themselves, were - occasionally still are - so eager to lionize those welfare cattle queens out west who occasionally veer into violence.

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I'd say it is about as usefully specific a term as "fat cat". I really only started to see it used by the general public, that is internet arguers, about ten years ago, usually urbanists talking about whatever it was they didn't like, or more precisely an incumbent class they didn't like, that in their view prevented density.

It seems a little "all over the map". Profits where "wealth was not created"? And also, homeowners who protest the details of some development or other. I'd appreciate a post on this if you ever want to offer one.

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To be fair, the urbanists sometimes also used it to reflect land speculators whose long-term interest in a property was going to be rewarded by what went on around them, but whose short and medium term actions were antithetical to the interests of the people of the area. The "rent" isn't always enabled by government policy, at least wholly.

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The dishonesty in America's political culture is some free lunches are blessed and others are condemned. An honest discourse would recognize that all sensible people desire more for less. What matters is there exists a fair system for deciding what things cost, who pays and who profits. The tale as old as time is government creates rules for trade and then keeps adjusting the rules to meet political needs and eventually the rules become wholly corrupted.

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Homo sapiens use about 20% of our total energy budget to feed that hunk of fat between our ears. The energy devoted to our brains is huge relative to all other primates and animals, which raises a genetic issues about what drove natural selection for bigger brains and not bigger balls and stronger arms?

Long before our species arrived other primates relatives learned how to make stone tools and some like Homo erectus got smaller jaws and smaller canine teeth indicating a cooked diet which implies some control over fire. Most primate species are not very nice to strangers.

For our species to explode someone had a stranger come into the tribe with a "better rock" (not all rock is created equal for making tools) and the tribal leader had a choice of stealing his rock and killing him, if necessary, or giving him some dried food and fancy shells and sending him back to get more rock. Both got more sex and children and Homo sapiens was off to the big brain race as you had to remember whether trading with people required long time knowledge to know who to trust.

Those with the metal ability to keep track of history over long times had a "fitness" advantage that exceeded the extra energy costs (allowing natural selection for brains over brawn). Other poorly distributed resources like salt and coastal shell sources would enter trade as soon as the females put-out for shells. These early trades can be traced as rock and shell sources can be identified.

I haven't found any books looking at these early years, but they have found some humans with even larger brains only 10,000 years old, but before writing and other memory assistance was available.

It should all be scientifically traceable by looking at rock sources, but both anti-evolutionists and modern social science/humanities, which don't believe in the power of trade, would not want "specialization and trade" to be the driving force for human intelligence and evolution of our species. It doesn't fit their narrative.

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short version : economics is part of the study of history and not a separate area of study

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The category of 'this defines humans' is historically tricky. I see adaptive specialization and trade in bacteria, other microorganisms, possibly plants; I'd have to think more about animals. The question is how the behavioral, developmental, ecological, and evolutionary timescales intersect; and the phylogenetic scale.

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"For most of our evolutionary history we lived in groups below the Dunbar number, so there is no reason for us to have inherited an intuitive appreciation of markets."

In their 2009 book "The 10,000 Year Explosion" Cochran and Harpending describe the explosion of human evolution, including genetically-based psychic evolution, that followed the spread of agriculture and growth of cities. So there has been time for modern humans to have developed an intuitive appreciation for markets. Not saying they did, just that they could.

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I have a question about the Dunbar #. Is it about the total number of people with whom an individual can manage relationships? Or does each individual live in overlapping Dunbar orgs? It guess it must be the latter. Every govt. org in which I live is above Dunbar (although the county building permit office is below); my church is below. My Facebook friend # is above, my X followers below. So an aspect of complexity is how the below groups interact with the much more numerous and influential above groups, and how we as limited-capacity individuals interact with them all.

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Arnold - This is not your best post, but it’s very important, so let’s talk about it. Let me first try to summarize and then I’ll suggest areas of focus. Please tell me where I can improve my understanding of your post if I go astray.

You want to understand human interdependence (a more sophisticated version of “economics” that you sketch out here). In addition you seek to promote learning and appreciation of markets. This is important because it will bring about more order.

What is order? This is difficult to define, but it emerges from pursuit of truth.

What is truth in this context? It is “what works best” for people. And what works best for people is between the realms of science and religion.

In order to figure what works best, we need norms of respect and freedom. We need the right incentives. This is where things can become unwieldy, and this is where you should focus your thinking.

In order to promote learning and appreciation of markets, how can you improve your messages? Let me re-direct your attention to your fantastic post “What Stops Learning? Think About Removing Barriers.”

Let’s take that list of barriers and write each up on a whiteboard. Let’s walk through each one of those barriers, brainstorming ways to move beyond those barriers. I think we should be focusing on dogmatism, but others will highlight the importance of other barriers.

What specific language should we use to breakdown dogmatism? This depends on the context—whether we’re talking about supernatural dogmas, education dogmas, racial dogmas, gender dogmas, egalitarian dogmas.

I’m not sure if you’ve listened to the beginning of the Econtalk this week, but I found Jeremy Weber description of the book’s origin fascinating. I should look at that book.

——Start Block Quote——

Russ Roberts: How did you come to write this book?

Jeremy Weber: The book was in development in my head for probably more than a decade. […]. Then I went into academia to teach statistics to policy students. And, the book I was using, the course that I inherited, very quickly I had the feeling I was more or less wasting students' time, or at the very least there were huge gaps such that when they left my class, they weren't going to be prepared to use any of this to help anyone in a practical setting. […] And, from that point on, I started to accumulate notes on things that, if I were to write a book, I would want to include and things that I was now using to complement the statistics textbook to give my students more.

Russ Roberts: What is its purpose and who is the audience?

Jeremy Weber: Yeah. I'll start with the audience. The audience is broad, because frankly, whether it's your first statistics class or your fifth, many of the issues are the same and neither the intro nor the advanced tends to do some things well. In particular, the communication of statistics to a non-academic audience, the integration of context and purpose of the moment or of the organization or of the audience into what you're presenting--its significance for the situation at hand--we tend to not do that well, I think, at the undergraduate level. Or for Ph.D.s who are in their fifth year of econometrics. So it's--the audience is broad.”

——End Block Quote——

The most important sentence in this excerpt is: “In particular, the communication of statistics to a non-academic audience, the integration of context and purpose of the moment or of the organization or of the audience into what you're presenting--its significance for the situation at hand--we tend to not do that well, I think, at the undergraduate level.”

We tend not to do that well. Yes. We tend not to communicate well in our teaching.

How do we communicate technical information to a non-academic audience? It would certainly help to cut funding to public education, in order to improve incentives. With funding cut, teachers will spend more time teaching to non-academic audiences and better communicate with their academic audiences. But setting this aside.

Specifically we need to teach with the student’s learning in mind. We need to integrate “context and purpose of the moment.” We need to show “its significance for the situation at hand.”

When I walk through Walmart I’m reminded of the various people that live in my community. How do I communicate the significance of markets to them? What context would best help them learn? What are my other audiences? What is their interest level? How can I learn what context would be most effective to engage them in learning about human interdependence?

We can sit here for years, talking amongst ourselves with little changing. We need to write better books. Rob Henderson’s Troubled comes to mind. What can we learn from Rob about communication?

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One sense of order that economics takes for granted is a common priority on material wellbeing. There seem to be more examples - Putin, Hamas, Xi, some on the extreme American Right and Left - where actors embrace lower living standards in pursuit of expressive values, status, punishing enemies, etc.

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“That is why I read broadly in those areas, rather than economics journals.”

I suspect a major reason for that is you are already pretty familiar with the economic literature. Your reading economics journals has gotten way into diminishing returns. Reading in those other areas, on the other hand ...

Someone just starting out trying to understand human society would do well to learn "concepts, such as opportunity cost, scarcity, choice, and incentives" and to see how they help explain both interactions involving money and--sometimes--interactions not involving money.

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I think I understand what you mean by order but it seems very undefined, especially if one is going to research topics related to it.

I don't mean to make a negative association but your post reminds me of MAGA. The left likes to frame that as wanting whites more dominate. I don't see your order that way and suspect MAGA fans are also more interested in your order than white supremacy. I'm not sure what that means for going down the path you like but it seems to add reason to being sure order is well defined.

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“That is why I read broadly in those areas, rather than economics journals.” Much of the difference in your view of economics is due to the better incentives you’ve created for yourself namely the direct payment between your students and you. Arnold Kling serves people. University professors serve their CVs.

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If you consider that economics is simply reductionism applied to social science (and that reductionism is the core of science), then economic imperialism is not “using economics for everything” but using methodological individualism for all social sciences.

And given that the alternative to “methodological individualism” is animism, in fact economic imperialism is simply making social science for all kinds of social behavior.

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Enjoyable, pragmatic post. It seems apparent to me that most, if not all, of the "social sciences" would be better off if viewed "as a subset of the larger topic of human interdependence."

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"For most of our evolutionary history we lived in groups below the Dunbar number"

This is an excellent essay and a point about this single sentence fragment should not detract from it. This may seem like a small disagreement on a small point, but the downstream assumption errors from it among many people smarter than me are many. This sub Dunbar assumption seems to be very prevalent among academics. I have seen Robin Hanson and John Vervaeke more or less say exactly this same thing. I am fairly certain it is somewhat wrong, and the circumstantial evidence is continually getting larger for its wrongness. In Razib Khan's recent podcast with Chris Stringer they talk about the likely Denisovan skull "Dragon Man" and how he has morphological traits closer to homo sapiens despite Denisovans being genetically closer to Neanderthals. There is also a paper from around 2020 showing how increased Neanderthal DNA can have a protective effect on schizophrenia and better treatment success, and there was a recent paper, maybe preprint, that there is a cold adaptation among at least 3/4 or more of Eurasians believed to be from Denisovans that has important implications in mental health. Europe, where Neanderthals tried to thrive, seems to be a much harsher environment to survive and thrive in for much of history and probably had lower density. Where as Denisovans were multitudinous enough to have at least three or four or more different populations that left genetic imprints as far away as the Amazon. If you look at schizophrenia rates they do seem to be much higher in densely populated places like Japan and parts of Indonesia. There are also some extrapolative assumptions I am making based on population extinction or absorption from crude DNA percentages when you look at what happens when different groups admix throughout history and how this changes with regard to density. Also, behaviorally modern and morphologically modern probably going mostly hand in hand is assumed here. Apologies if these dots do not seem as coherent to others and I have failed to list some other assumptions of import I am making. I do believe the Dunbar number is true and important, but the number of people above the Dunbar number in the clan and the tribe and their likely import is hundreds of thousands of years more important than many people much smarter than me have been assuming for a long time.

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I'm lost. I see nothing in you comment supporting the idea something is wrong with the Dunbar number. And what does schizophrenia have to do with it?

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Mar 5Edited

There are many cultural and genetic pathways to the same places. They depend a lot on density within a gene culture coevolutionary environment. Schizophrenia rates are higher with higher densities and even ancestral populations exhibit some evidence of this when their DNA is added to homo sapiens. There is nothing wrong with the Dunbar number and I did not say there was. There is something wrong with the assumption that sub Dunbar numbers were the norm up until the Holocene. Numbers up to 500 to 2000 hold great import for our history in the pleistocene, even if we have replaced them with different institutions in the WEIRD present.

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ok. but it still seems to me that for most of our evolutionary history [most of us] lived in groups below the Dunbar number. It also seems to me there is research on prehistoric large groups that research on sub-Dunbar doesn't preclude. So what do you think academics have missed by not fully considering larger groups?

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Maybe I'm dense but I don't see what most of the original comment had to do with how big most pleistocene human groups were. Are you saying that if they were all below 150 members, schizophrenia would never have happened?

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Look guys, just forget the mental illness stuff, it clearly is distracting and takes linking to more research than is worth it in a comment thread. Baseline is that the sub Dunbar assumption for the pleistocene is a 20th century assumption without DNA, which is currently rewriting a lot. Samo Burja thinks there are lost civilizations older then 11,000 years and bet Scott Alexander as much. https://longbets.org/933/

I'm not even claiming that. I am just claiming sedentary gathering especially in marine rich and/or warmer climate areas likely supported populations greater than 150 quite often. I understand I am a little out on a limb, but it is not a twig, and this isn't an unreasonable assumption based on the massive scholarship of the last 15 to 20 years mostly in genetics and its intersection with everything human. I appreciate the pushback at my lack of coherence.

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Undoubtedly, there were some Pleistocene people in groups of more than 150 people, especially in rich marine areas. The question is how common such groups were.

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