Social Cooperation: Why Thieves Hate Free Markets

| September 2 2012
Christopher Cook

Thomas Hobbes (1588–1679) believed that in a state of nature, human beings would be in constant war with, and fear of, each other, and that the only solution was a very powerful state.

John Locke (1632–1704) believed that in a state of nature, there would be bad actors, but most human beings would find ways to cooperate. Thus, only a minimal state is required, one that provides neutral, third-party security, justice, and adjudication of disputes.

To some degree, Western civilization is still dining out on the ideas of the European Enlightenment, with people on the political right (small-government conservatives, libertarians, etc.) hearkening back to Locke, people on the political left (left-liberals, statists, dictators, etc.) hearkening back to Jean-Jacques Rousseau, and some people from both sides preferring the Hobbesian view.

The title of the video below is “Social Cooperation: Why Thieves Hate Free Markets,” but it might just as well be why Hobbes was wrong and Locke was right! (Rousseau is so off the deep end as to be out of this particular comparison entirely.)

Many believe that market economies create a dog eat dog environment full of human conflict and struggle. To Prof. Aeon Skoble, the competition in markets does not create conflict, but rather, encourages people to cooperate with one another for mutual benefit.

For instance, suppose a thief steals a suit from Macy’s. If Macy’s knew who the thief was, one could argue that Macy’s has an incentive to keep this information from their competitors. By withholding information about the thief, it would make it much less likely that thief would get caught while robbing Macy’s competitors. However, in the real world, competitors share information about theft with one another, creating a valuable information network. Competitors share information because it is in all of their mutual interest to crack down on theft. If a business chooses to ignore the information network, they lose out on valuable information.

The example above is just one of many examples where competitors have a strong incentive to cooperate with one another. In a certain way, we’re all merchants who trade with one another. We all individually depend on networks of reputation and trust to own a car, own a home, and have a job. In a world of competition and scarcity, we are not only capable of cooperating with one another, but we frequently do.

These voluntary systems of social cooperation, often called organic or spontaneous orders, are not planned from the top down by enlightened rulers. Rather, they emerge overtime as individuals interact with one another. These spontaneous orders are all around us, and include important things like language, fashion, internet memes, prices in a market, and law.

Going back to the suit thief, it may very well be the case that some individuals abstain from crime because of the threat of jail. However, it is also very likely that crime is prevented through networks of trust and reputation. The next time you hear that the problems that society faces can only be solved by applying force from the top down, you are right to be skeptical. Peaceful and voluntary mechanisms that encourage and facilitate cooperation are all around us.

Watch more videos: http://lrnlbty.co/y5tTcY

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