December 1, 1998
With Responses From
Dec 1, 1998
4 Min read time
Bowles and Gintis argue that Americans' hostility to welfare emanates not from selfishness but rather from the sense that current welfare programs are unfair. It is not that we begrudge the deserving poor an equitable share. It is that we feel hardworking taxpayers are being duped by too many welfare cheats, people who could work but who choose not to in an attempt to get something for nothing.
The solution to this problem, in the authors' view, is not for social policy-makers to advocate more altruism toward the poor--which they deem unrealistic--but rather to stress the reciprocal aspect of our world. Essentially, then, Bowles and Gintis wish to move policy-makers away from the reliance on Homo economicus and toward a more complex model of man, one that allows for our needs and our capacity for reciprocity.
I applaud this move. Anything that encourages economists to break out of their narrow paradigm is commendable. I just don't think Bowles and Gintis go far enough in shaking policy-makers loose from their economic paradigm.
1. Homo reciprocans is defined by Bowles and Gintis as someone who cares about more than mere reciprocity. Their Homo reciprocans cares about "the well-being of others and about the processes determining outcomes." Unfortunately, the numerous studies they cite to demonstrate that Homo reciprocans does exist refer more to reciprocity as traditionally defined, not to the nobler version of theHomo reciprocans Bowles and Gintis advocate.
The strategy pursued by the winners in Axelrod's experiments, for example, was to trade tit for tat, or two tits for tat. This means that if you treated me ill once, I would nonetheless respond nicely once, ignoring your ill treatment in order to engender a favorable response on your part in our next interaction. If you persisted in responding in a negative way, however, I would then respond in turn. In other words, if you persist in being mean to me, I will be mean to you. Like engenders like. There is no inherent concern for others built into the winning strategy in the Axelrod experiments. The kindness and generosity are strategic, designed to elicit good treatment for me. Axelrod's players were willing to take one chance, hoping that good deeds would be returned in kind. But there was always the stick following up the carrot, and the theoretic results of Axelrod's game carry a clear implication: the best way to get people to treat you well is to make them realize that they will pay if they do not.
This does not seem to be what Bowles and Gintis want to encourage. If it is, then it is fair to say that their version of Homo reciprocans is merely Homo economicus with a longer time horizon, economic man willing to wait to get paid back, and hoping for positive returns.
2. Bowles and Gintis stress the importance of perceptions: how we see the other, the welfare recipient, influences our behavior. This general phenomenon, noted in many experiments on framing, is important. Economic policy is heavily influenced by the policy-makers' views of the recipients, as evidenced by the phrase "the deserving poor." Thanks to scholars in social psychology such as Daniel Kahneman, Paul Slovic, and Amos Tversky,1 economists have begun to incorporate this kind of perspectival concern into their models of economic policy-making.
3. Bowles and Gintis quite properly make the link between economic policies and our basic economic theories, and find existing theory wanting. If they wish to construct new economic theory, however, especially theory that more accurately captures the underlying human nature of mankind, let me suggest the following. Begin with the assumption that human nature revolves not just around self-interest but around the twin poles of self-interest and sociability.
Self-interest is well-known to the economist and has served as the basis for most social theory since Thomas Hobbes. Adam Smith's great contribution to the world was to turn it into something positive through the magic of the market mechanism and the invisible hand.
Sociability refers to our desires to live in a group. We want to be part of a group of people whom we respect, people who like us, whose values we share, and people whose cognitive reasoning processes we can understand. But sociability implies more than treating people well as a means to a self-interested end; it makes other people ends in and of themselves. Sociability cannot be reduced to merely another value to be weighed in a utility function. It speaks to who we are, to what it means to be a human being, and says that we are social beings whose existence is not complete unless we care for others, and are in turn cared for by them. Reconceptualizing our models of man to allow for this mutual caring will have profound effects for policy-making, and will allow for the fairness and reciprocity that concern Bowles and Gintis.
I thus would chide the authors for being too conservative, too wedded to the existing economic paradigm, and would encourage them to think more boldly as they construct social theories on which we should base our socioeconomic policies.
1 See their Judgment under Uncertainty: Heuristics and Biases(New York: Cambridge University Press, 1982).
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December 01, 1998
4 Min read time