I thnk you are missing a key point: while it is true that much of the value in human life comes from communities and other social institutions, that value is value *for the individual humans that are part of those institutions*. There is no such thing as "value to the institution" if no human gets value from it. And if every human member of an institution is better off if that institution dies, which you say is the case for your example of the small town after the railroad connects it to the metropolis, then it *should* die. Institutions are human tools, and humans can choose to change the tools they use.
On the other hand, it's true that people often do not appreciate the value they derive from the social systems they are embedded in, that they construct through their behavior, that *emerges* from their behavior. The railroad may be an improvement in the most immediate tangible sense, but it might also mean harm *to the individual* in less evident ways. This is arguably what makes social decision-making complicated—unexpected consequences are by definition hard to deal with.
> people often do not appreciate the value they derive from the social systems they are embedded in
And if that's the case, then in the article's hypothetical, the people are *not* better off. They might think they are, but they are wrong. That's a *different* case from the case where they *are* better off.
> This is arguably what makes social decision-making complicated—unexpected consequences are by definition hard to deal with.
And the best way to minmize the impact of this unavoidable difficulty is for "social decision-making" to be done by the people who are going to be most affected by the change--in the article's hypothetical that would be the small town. In other words, the railroad should not be built just because some railroad magnate wants to, or because some government bureaucrat thinks it furthers some high-level social policy. It should be built if and when the small town community, after full discussion among its members, says it wants the railroad.
This is a common ideological assumption (that all value grounds out in individual experience) and I just don't share it. Most people in history didn't share it, they thought their families and tribes and gods and monuments had value over and above how they affected individuals.
That being said, we don't disagree that much in practice - in the case of the small town I meant that each of the townsfolk might have strictly more choices (so if they were homo economicus, should have higher utility) but in practice might end up regretting the building of the railroad even by their own values due to the coordination failure.
> This is a common ideological assumption (that all value grounds out in individual experience) and I just don't share it.
It's not an "ideological assumption", it's an obvious fact. Where *else* can value reside? Social institutions are not independent beings with their own life. They don't have feelings. They don't suffer. They are, as I said, tools that we individual humans use to facilitate social cooperation between us, because social cooperation opens up much better life possibilities than Robinson Crusoe individualism would. That doesn't mean the institutions have experiences of their own, independent of the humans who are members of their own.
> Most people in history didn't share it, they thought their families and tribes and gods and monuments had value over and above how they affected individuals.
I disagree. You are just making a blithe assumption here that I don't think has any basis in fact. I think people valued families and tribes and gods precisely *because* of how they believed those things affected their individual lives. They just had what we now think were false beliefs about *how* those things affected their individual lives. For example, they believed that propitiating the gods would give them a good harvest, and that's why they did it, not because they believed gods had some sort of independent value in and of themselves.
It does mean, however that, within the limits of justice, a private good must be forfeited if it harms the common good. A concrete example could be the railroad and town example he shared, although that will always depend on the concrete case. However, preserving traditions and culture definitely takes precedence over material prosperity, since traditions and culture can be enjoyed by those alive now and those yet to come, but material prosperity, by it's nature, ebbs and flows due to circumstances no one can reliably control. Not to mention that it's unlikely the 5th generation of all the townsfolk will enjoy the benefits of the prosperity of those alive now, whereas, if left alone, they would easily enjoy the benefits of their culture and give that to their own decendants without diminishing the amount they enjoyed those things in the slightest
I'd say his assumption is quite right. Indeed, the value of institutions is concretely realized on the individual level (one of the benefits of being employed at a company, for example, is to receive my paycheck). However it's a pretty common theme amongst almost all of the western philosophical tradition, up until the enlightenment, that humans are social *by nature*, evidenced by the fact that from birth they are born in a society (their family) and, in fact, if they lack this basic society, it's a death sentence. After all, you might be adopted or sustained by someone, but no one ever survived to adulthood from their birth without another human to keep them alive. At least.
Moving on, given humans are social by nature, the families that compose a given tribe, city or what have you, associate themselves in order to share the goods that they couldn't possibly obtain on their own, for any number of reasons: we can't all be experts on everything nor know how to produce all that we need, as individuals, and even beyond that, there are goods that can only be had in society, by their own nature: help in times of want, companionship, conversation and, most especially, knowledge of just about anything.
All these things, are indeed goods to be enjoyed concretely by individuals, but goods that are more common (in the sense of transmitable) were always regarded as higher goods than things that could only be enjoyed by one person or fewer people, hence the notion of common good (again, in the sense of communicable). Common good was always seen as having precedence over the individual good (individual here can be a person or a group, as long as the common good considered is common to a society that encompasses the individual considered).
Therefore, these societies and institutions do have value in and of themselves, because they are meant to provide these goods which are common to all members of a given society.
I'd like to note this is *very* different from the notion that one person's good can be sacrificed, no matter what, in the name of the good of the many. Ironically, that is one of the fruits of the enlightenment. In fact this kind of conclusion is against the common good because it goes against justice, which is a common good.
> goods that are more common (in the sense of transmitable) were always regarded as higher goods than things that could only be enjoyed by one person or fewer people
Where is this extremely broad claim coming from? What are these "common" goods?
> these societies and institutions do have value in and of themselves, because they are meant to provide these goods which are common to all members of a given society.
Non sequitur. Even leaving aside my objections above, these "common" goods are still goods *to individuals*. There is no value in institutions aside from their ability to provide such goods to individuals, whether it's one individual, a small group, a large group, or everyone.
Also, institutions are made up of individuals. Institutions don't do anything of themselves; when we say an institution "does" something, what we actually mean is that one or more individuals making up the institution did it, and claimed some sort of authority based on the institution.
> in the case of the small town I meant that each of the townsfolk might have strictly more choices (so if they were homo economicus, should have higher utility) but in practice might end up regretting the building of the railroad even by their own values due to the coordination failure.
If they end up regretting the building of the railroad, then they *aren't* better off. But your hypothetical said they are. You can't have it both ways. "Values" does not just mean "homo economicus" values. It means whatever people actually value.
Can’t this be framed in terms of negative externalities and unintended effects? Sometimes the parties involved make a win/win agreement but it sends out unintended and unanticipated "wakes" which can have negative (or positive) effects on others or can even bounce back to the original decision makers. It seems one response would be to try to expand our horizons to the longer term effects including said wakes. This may also need to be built into institutions and culture.
yeah I think technically these are negative externalities, but that term makes it feel like it's avoidable with the right institution, whereas my argument is that many of these are not avoidable. We really do have to choose, as a society, between having many small towns or a richer metropolis; either choice comes with serious costs to things we value.
Well. I wouldn't be studying game theory if i didn't believe in its usefulness for modeling conflict and co-operation. My life goal is to end conflict—all conflict—forever—especially violent conflict.
But i don't believe in the magic of game theory despite its focus on individuals. I believe in the magic of game theory because it helps us figure out how societies emerge from the behavior of individuals.
I'm not a believer in Coase's “theorem”—it sounds to me like a crude attempt to justify private property over collectively managed resources. I believe in the Ostrom approach to economic institutions.
> I'm not a believer in Coase's “theorem”—it sounds to me like a crude attempt to justify private property over collectively managed resources.
No, it's a recognition of the *limitations* of "collectively managed resources". Surely the twentieth century taught us that "collectively managed resources" is a disaster. Coase's Theorem doesn't say private property is perfect. It just says that, if you want to improve outcomes, private property plus lowering transaction costs, so that people can make as many mutually beneficial trades as possible, is better than any alternative.
I thnk you are missing a key point: while it is true that much of the value in human life comes from communities and other social institutions, that value is value *for the individual humans that are part of those institutions*. There is no such thing as "value to the institution" if no human gets value from it. And if every human member of an institution is better off if that institution dies, which you say is the case for your example of the small town after the railroad connects it to the metropolis, then it *should* die. Institutions are human tools, and humans can choose to change the tools they use.
On the other hand, it's true that people often do not appreciate the value they derive from the social systems they are embedded in, that they construct through their behavior, that *emerges* from their behavior. The railroad may be an improvement in the most immediate tangible sense, but it might also mean harm *to the individual* in less evident ways. This is arguably what makes social decision-making complicated—unexpected consequences are by definition hard to deal with.
> people often do not appreciate the value they derive from the social systems they are embedded in
And if that's the case, then in the article's hypothetical, the people are *not* better off. They might think they are, but they are wrong. That's a *different* case from the case where they *are* better off.
> This is arguably what makes social decision-making complicated—unexpected consequences are by definition hard to deal with.
And the best way to minmize the impact of this unavoidable difficulty is for "social decision-making" to be done by the people who are going to be most affected by the change--in the article's hypothetical that would be the small town. In other words, the railroad should not be built just because some railroad magnate wants to, or because some government bureaucrat thinks it furthers some high-level social policy. It should be built if and when the small town community, after full discussion among its members, says it wants the railroad.
This is a common ideological assumption (that all value grounds out in individual experience) and I just don't share it. Most people in history didn't share it, they thought their families and tribes and gods and monuments had value over and above how they affected individuals.
That being said, we don't disagree that much in practice - in the case of the small town I meant that each of the townsfolk might have strictly more choices (so if they were homo economicus, should have higher utility) but in practice might end up regretting the building of the railroad even by their own values due to the coordination failure.
> This is a common ideological assumption (that all value grounds out in individual experience) and I just don't share it.
It's not an "ideological assumption", it's an obvious fact. Where *else* can value reside? Social institutions are not independent beings with their own life. They don't have feelings. They don't suffer. They are, as I said, tools that we individual humans use to facilitate social cooperation between us, because social cooperation opens up much better life possibilities than Robinson Crusoe individualism would. That doesn't mean the institutions have experiences of their own, independent of the humans who are members of their own.
> Most people in history didn't share it, they thought their families and tribes and gods and monuments had value over and above how they affected individuals.
I disagree. You are just making a blithe assumption here that I don't think has any basis in fact. I think people valued families and tribes and gods precisely *because* of how they believed those things affected their individual lives. They just had what we now think were false beliefs about *how* those things affected their individual lives. For example, they believed that propitiating the gods would give them a good harvest, and that's why they did it, not because they believed gods had some sort of independent value in and of themselves.
Damn, now I see this thing does top posting. My first reply is the bottom one...
It does mean, however that, within the limits of justice, a private good must be forfeited if it harms the common good. A concrete example could be the railroad and town example he shared, although that will always depend on the concrete case. However, preserving traditions and culture definitely takes precedence over material prosperity, since traditions and culture can be enjoyed by those alive now and those yet to come, but material prosperity, by it's nature, ebbs and flows due to circumstances no one can reliably control. Not to mention that it's unlikely the 5th generation of all the townsfolk will enjoy the benefits of the prosperity of those alive now, whereas, if left alone, they would easily enjoy the benefits of their culture and give that to their own decendants without diminishing the amount they enjoyed those things in the slightest
> preserving traditions and culture definitely takes precedence over material prosperity
I think it depends on the traditions and culture; some traditions and cultures have elevated material prosperity above all other things.
I'd say his assumption is quite right. Indeed, the value of institutions is concretely realized on the individual level (one of the benefits of being employed at a company, for example, is to receive my paycheck). However it's a pretty common theme amongst almost all of the western philosophical tradition, up until the enlightenment, that humans are social *by nature*, evidenced by the fact that from birth they are born in a society (their family) and, in fact, if they lack this basic society, it's a death sentence. After all, you might be adopted or sustained by someone, but no one ever survived to adulthood from their birth without another human to keep them alive. At least.
Moving on, given humans are social by nature, the families that compose a given tribe, city or what have you, associate themselves in order to share the goods that they couldn't possibly obtain on their own, for any number of reasons: we can't all be experts on everything nor know how to produce all that we need, as individuals, and even beyond that, there are goods that can only be had in society, by their own nature: help in times of want, companionship, conversation and, most especially, knowledge of just about anything.
All these things, are indeed goods to be enjoyed concretely by individuals, but goods that are more common (in the sense of transmitable) were always regarded as higher goods than things that could only be enjoyed by one person or fewer people, hence the notion of common good (again, in the sense of communicable). Common good was always seen as having precedence over the individual good (individual here can be a person or a group, as long as the common good considered is common to a society that encompasses the individual considered).
Therefore, these societies and institutions do have value in and of themselves, because they are meant to provide these goods which are common to all members of a given society.
I'd like to note this is *very* different from the notion that one person's good can be sacrificed, no matter what, in the name of the good of the many. Ironically, that is one of the fruits of the enlightenment. In fact this kind of conclusion is against the common good because it goes against justice, which is a common good.
> goods that are more common (in the sense of transmitable) were always regarded as higher goods than things that could only be enjoyed by one person or fewer people
Where is this extremely broad claim coming from? What are these "common" goods?
> these societies and institutions do have value in and of themselves, because they are meant to provide these goods which are common to all members of a given society.
Non sequitur. Even leaving aside my objections above, these "common" goods are still goods *to individuals*. There is no value in institutions aside from their ability to provide such goods to individuals, whether it's one individual, a small group, a large group, or everyone.
Also, institutions are made up of individuals. Institutions don't do anything of themselves; when we say an institution "does" something, what we actually mean is that one or more individuals making up the institution did it, and claimed some sort of authority based on the institution.
> in the case of the small town I meant that each of the townsfolk might have strictly more choices (so if they were homo economicus, should have higher utility) but in practice might end up regretting the building of the railroad even by their own values due to the coordination failure.
If they end up regretting the building of the railroad, then they *aren't* better off. But your hypothetical said they are. You can't have it both ways. "Values" does not just mean "homo economicus" values. It means whatever people actually value.
Can’t this be framed in terms of negative externalities and unintended effects? Sometimes the parties involved make a win/win agreement but it sends out unintended and unanticipated "wakes" which can have negative (or positive) effects on others or can even bounce back to the original decision makers. It seems one response would be to try to expand our horizons to the longer term effects including said wakes. This may also need to be built into institutions and culture.
yeah I think technically these are negative externalities, but that term makes it feel like it's avoidable with the right institution, whereas my argument is that many of these are not avoidable. We really do have to choose, as a society, between having many small towns or a richer metropolis; either choice comes with serious costs to things we value.
Well. I wouldn't be studying game theory if i didn't believe in its usefulness for modeling conflict and co-operation. My life goal is to end conflict—all conflict—forever—especially violent conflict.
But i don't believe in the magic of game theory despite its focus on individuals. I believe in the magic of game theory because it helps us figure out how societies emerge from the behavior of individuals.
I'm not a believer in Coase's “theorem”—it sounds to me like a crude attempt to justify private property over collectively managed resources. I believe in the Ostrom approach to economic institutions.
> I'm not a believer in Coase's “theorem”—it sounds to me like a crude attempt to justify private property over collectively managed resources.
No, it's a recognition of the *limitations* of "collectively managed resources". Surely the twentieth century taught us that "collectively managed resources" is a disaster. Coase's Theorem doesn't say private property is perfect. It just says that, if you want to improve outcomes, private property plus lowering transaction costs, so that people can make as many mutually beneficial trades as possible, is better than any alternative.
Thank you for clarifying what i meant.
Economics is wrong even about that once you consider the impact of land ownership.
This was a thoughtful essay. Some things to ruminate on. Thanks.