Capitalism and Human Nature

My colleague Will Wilkinson has a very fine essay on evolutionary psychology and its implications for political and economic life in Cato Policy Report. It’s available on PDF and HTML. I recommend it quite highly.



6 Responses to “Capitalism and Human Nature”

  1. I really enjoyed this piece as well. Something that is not mentioned in the paper, but that fits in nicely with the logic behind it, is the difficulty of convincing people of the benefits of private accounts within Social Security. Humans are pretty good at estimating calculations based on addition (something hunter-gatherers might need to do for survival), but horrible at estimating something like the effects of compound interest (something there is no way hunter-gathers would need in order to survive).

    For our minds it’s just not intuitive that investing $2000 a year over a 45 year period ($90,000 of actual savings) turns into $1,251,725.52 if it compounds at 9%. So try as he might, pointing out that a portion of our payroll taxes will now compound at 6.5% instead of 1.5% will never have the desired effect that Bush is looking for as he is pitching the idea around the country. Might be best to put it in other terms.

  2. I think one problem people have with capitalism is the idea of explicit vs. implicit cooperation. Socialism bases itself on the idea that we must directly help eachother by planning the day to day operations, giving to those in need etc.etc. This will work in small bands of hunter-gatherers; however in a complex society, it doesn’t work.

    However, because we are programmed to think like hunter gatherers, central planning etc. may seem natural, while implicit cooperation through the market place does not.

    I think this is unfortunately one reason why many people are hesitant to embrace the market place.

    Interesting article nonetheless.

  3. There is another point, at the risk of being called “racist”, that I think is worth noting.

    Wilkinson makes a fundamental error in blurring all coalitional categories together. (Paul Rubin makes the same mistake in his book Darwinian Politics that Wilkinson cites.) What neither of them discuss is the difference between Genetic Similarity mechanisms and social identity mechanisms. The latter-which include hometown, occupation, political orientation etc.- are fluid, while the former is not.

    Because racial groups fall under a genetic identity mechanisms (modern research in evolutionary psychology-called “Genetic Similarity Theory”- suggests that human’s unconsciencely can easily identify genetic distance between others through phenotype distances)

    I agree with his point that racial preferences heightens coalitional tensions, but it is because these tensions are based in biology, not because they are not, that makes them so violatile.