Monkey Economics and Human Evolution
I enjoy discovering and reading about research in some of
the lesser-known fields, so I was happy to stumble upon a few
studies about how monkeys deal with decisions about trading values.
And although I may have just invented the term "monkey economics"
the research is real. In particular there have been some interesting
experiments done with these primates which shed light on the
evolutionary economics of humans.
I did not invent or name the field of "evolutionary economics,"
by the way. It's a relatively new area of study that looks into
the biological and evolutionary forces and developments which
explain the economic decisions we make, and especially our seemingly
irrational ones. It's related to the field of behavioral economics,
which describes how we make decisions about money and trade.
Now, about those monkeys. Actually the research has been done
with both chimpanzees and monkeys. In one experiment at Emory
University, when two primates participated in a mutual task for
which one was rewarded, the second one stopped helping out in
future tasks if the first didn't share the rewards. That seems
rational, and very human-like.
However, monkeys also seem to share with humans the extreme
and seemingly irrational tendency to hurt their own self-interest
in order to protest unfairness. Pairs of capuchin monkeys, for
example, were trained to trade researchers a stone for a cucumber
slice, which was a pretty good deal from their perspective; they
averaged a 95% rate of cooperation in this arrangement. But when
one of the monkey pair was given a grape, which, in the monkey
marketplace, is more highly valued than a cucumber slice, the
other monkey who still could trade a stone for a slice of cucumber
suddenly didn't make the trade nearly as often. In fact, the
cooperation rate dropped to 60%. Sometimes the monkeys who got
the lower payment for their stones simply refused to take the
slice at all, even after they handed over the stone.
Apparently they would rather go hungry than be "taken
advantage of" in such an unfair exchange. Their sense of
justice seemed to overrule their own self-interest. We are not
the only primates to have evolved an emotional sense of justice
or fairness. This development may have helped maintain harmony
in the small groups we lived in thousands of years ago, or at
least that's a common evolutionary hypothesis. Now let's look
at the human experiments, but not before I mention my post on
the first recorded instance of monkey prostitution. You'll find that on my
Evolutionary Economics and Irrationality
There is an experiment economists call the "Ultimatum
Game," which is typically played with two people. They are
given $100 to split between them, but player one gets to propose
how to divide it. She might suggest that she gets $80, for example,
while the other "player" gets $20. Player two can say
yes, and each will get his or her designated share. If player
2 says no, neither one gets anything at all.
Rationally, player two should always say yes, since even if
the split proposed is $95 and $5, the $5 he or she will receive
is still better than nothing. There is nothing to be gained financially
by saying no. You might think there is the matter of setting
a precedent to consider, but the players in this laboratory game
know they won't be playing again, so a reputation for turning
down a low proposal gives them no advantage at all.
Interestingly, while subjects mostly accept "reasonable"
proposals, the obvious one being a 50/50 split, they commonly
refuse many "unreasonable" ones. To be more precise,
most players turn down proposals that give them less than 30%
of the money. Why do they turn down free money? Many simply explain
that it isn't fair. Fairness, apparently, requires them to turn
down their own share just to punish the other subject for making
the unfair offer.
Scientists working in the area of evolutionary economics hypothesize
that we have a built-in sense of "reciprocal altruism,"
which evolved over tens or hundreds of thousands of years. This
emotional reaction demands fairness, and must have provided some
advantage to the human species, even at the expense of personal
gain. Though the world is changed, and perhaps we can rationally
argue that now it would be more advantageous to take the money
in a situation like this, our minds are still functioning as
they have for hundreds of thousands of years.
Now here is a thought that comes to mind when reading about
studies like these: Hundreds of millions of workers in poor countries
make a tenth of what others make for the same work in wealthier
countries, so why don't they quit? Are they overcoming the monkey-mind
that throws away a cucumber slice if a grape can't be had? It
doesn't seem very probable. It is more likely just a matter of
proximity. They don't work near the higher-paid workers, but
around others who make the same low wages. Of course, it could
also just be too obviously irrational to starve for a feeling
of fairness, even if lesser pains will be suffered for the principle
(and I suspect that if you or I were in an ultimatum game where
a million-dollar prize was split 20% and 80% in favor of our
opponent/partner, we would overcome our inherent sense of fairness
and take the $200,000 versus nothing).
Where will monkey economics and other investigations into
evolutionary economics lead? It seems likely that in addition
to the irrational responses to the "Ultimatum Game,"
we can identify other common self-defeating economic behaviors
that take place in daily life, and then correct them. Scientists
may be right in hypothesizing that these irrationalities result
from the actual physical arrangement of our brains based on evolution,
but our "software" or conscious mind can evolve more
quickly than our hardware.