My intellectual influences, part 6: true North

My intellectual influences since 2000 are harder to trace. They tend to be indirect. For example, many of my ideas can be traced to Hayek, but I did not arrive at them by reading Hayek.

One person to whom my views can be directly traced is Douglass North. He is known for focusing on institutions. These intangible, human-created phenomena are more important than the tangible resources of an economy. Also, when one is tracing the mechanism of historical change (the word “change” appears in the title of many of North’s works), institutional change is part of that process. North’s 1993 Nobel lecture is a good summary of his approach.

Also very influential is Violence and Social Orders, by North, Weingast, and Wallis. Their idea of a “natural state” in which stability is achieved through power-sharing among cliques, is very important. They explain why it is difficult to escape this natural state and move to a liberal democracy with markets and legal equality.

Joseph Henrich delves even more deeply into the power of culture and the sources of cultural change.

The George Mason folks have been very influential, although I have not taken much advantage of their proximity to talk with them in person. Instead, the influence comes from their writing.

Tyler Cowen impressed on my the centrality of status in human affairs.

He also wrote a blog post about the problem of recessions being the “dual of the socialist calculation problem,” an idea that I ran with all the way to my book Specialization and Trade.

Robin Hanson’s idea that medical treatment is undertaken to “show that you care” regardless of outcome is influential. Also, his ideas about the disjunction between the stated purpose of many of our activities and its true purpose, e.g., “politics is not about policy.”

Russ Roberts’ emphasis on emergent order is something that one needs to hear in order to overcome the default assumption that society is designed.

I have been influenced by evolutionary psychology, including Steven Pinker’s The Blank Slate and various writings of John Tooby and Leda Cosmides.

25 thoughts on “My intellectual influences, part 6: true North

  1. Are you able to provide links to the pieces you mention by Tyler Cowen and Robin Hanson? Ditto for Heinrich and Roberts — if you’re able to point to a specific piece or writing or video. Thanks.

  2. Arnold, in y0ur previous post you addressed the influence of technological change on your analytical work by reference to how the internet evolved in a short period of time, and today the influence of X-change on your views by reference to the research work of a few social scientists. I say X-change because you are still attempting to put the pieces together and don’t have yet an analytical framework to explain social order and a theory of the evolution/history of social order (I use social in the broadest sense so you apply it to particular groups of people –the family, the tribe, the nation– and specific sets of interactions among each group’s members –like the economic order, the political order, the adjudication order). Indeed, an extraordinary challenge as shown by the many great social scientists involved in the past 2-3 centuries.

    Good luck.

    • Arnold, if you accept the challenge, remember this

      “But then came 2020, a year wreathed in horror. That year upset the presumptions of perpetual good health, perpetual prosperity, and perpetual peace. The year 2020 came with these three sobering and ancient lessons: Good health is a miracle. Prosperity is a miracle. And domestic peace, too, is a miracle. Health, prosperity, and peace are not the story of human history. The story of human history is sickness, poverty, and war. They are the domestic product of every people, in every time, in every place. And we have no right to insist otherwise. Ever.”
      https://reformclub.blogspot.com/2021/01/peace-is-miracle.html

      It’s a paragraph between pre-2000 and the new 2021.

      • And more importantly, read this

        https://pjmedia.com/spengler/2021/01/09/american-democracy-died-on-capitol-hill-n1327665

        I don’t expect that any democrat voter will read that column because they “sold” their lives to rotten and corrupt leaders a long time ago. I challenge the few democrats that read this blog but still defend those leaders to a serious discussion of the arguments that David Goldberg (Spencer) presents in his column.

        Most Americans –including almost all readers of this post– don’t believe that something similar is going on in other countries. As I have said in earlier comments, I have been following closely the political events of Argentina, Chile, and Spain for more than 50 years, and I say that their experiences are similar to the American one, which I have also followed for more than 50 years.

        • “The spectacle of a serving president inciting a mob against the U.S. Congress to stop the certification…”

          Can you please provide the Trump quotes that support this claim? I haven’t seen the transcript and just curious as to what he actually said that qualifies as incitement.

          • I don’t agree with DG on everything he says. I understand your point and I suggest you read this post by David Henderson

            https://www.econlib.org/did-trump-foment-a-violent-assault/

            citing a long post and comments by law-professor Ann Althouse (I agree with her position and remind you that Ann used to be a Never-Trumper in 2016). You can also find other references by lawyers arguing the same ide that there was nothing illicit in Trump’s speed.

            BTW, you can read comments to David Henderson’s post and see that some readers are arguing that the context was a rebellious one. They are totally wrong because the relevant context of Trump’s latest actions is the series of events that started in 2016 by a gang of rotten and corrupt democrats trying to deny him the Presidency that he had won.

          • I don’t think Ann Althouse was ever a Never-Trumper. She supported Barack Obama in 2008 but then was disappointed that he was not a racial healer, if anything the reverse. She very much disliked Hillary Clinton, feeling she had betrayed feminism by not just defending her husband but attacking his accusers.

            She has been disappointed by the illiberal turn of so much of the establishment left, and felt that too much of the criticism of Donald Trump suffered from a double standard. She declared herself “cruelly neutral” this year and didn’t vote.

            She retired from teaching a few years ago to devote full time to blogging and living her life. Her blog is perhaps the most interesting on the web

        • I have just read again the comments to David Henderson’s post I refer to in an earlier comment.

          It’s amazing how malicious, mendacious, and hypocrites in ignoring what has happened in the past 5 years. I hope they stay to watch the movie that will be running for some time, perhaps many years. Everything that has been happening since November 3, 2020, it’s a direct consequence of what had happened since mid-2016. They are happy because finally they are getting rid of Trump. They have paid a huge price for it, much higher than they anticipated in 2016, but nothing in comparison with the price they will have to pay to keep the power they have grabbed.

  3. Re: indirect influences. I’ve glimpsed indirect influences in two other areas in which your writings are fresh and incisive.

    1) Public choice theory (Buchanan, Tullock, etc.). Your writings about the new commanding heights of the economy, shaped by “restrict supply, subsidized demand” and other public-choice pathologies.

    2) Sorting & mixing (T.C. Schelling; Thiebout); and voice & exit (A. O. Hirschman). Your analytical and normative writings about unbundling governance and creating exit options.

    • “Public Choice” was a sub-optimal phrase.
      Better would have been “Government Choice”, so that it’s clearly an issue of what the gov’t chooses, those human decision makers who decide.

      Dems are good at changing words & phrases, often confusing things. This change would be to make it more accurate – as well as going towards Government schools & Government policy.

  4. Russ Roberts’ emphasis on emergent order is something that one needs to hear in order to overcome the default assumption that society is designed.

    The flip side of that, which I think Libertarians often ignore, is that emergent order is usually unstable. Empires emerge from chaos and collapse back into chaos, and the chaos can last for millennia before order re-emerges. The same is true for smaller-scale forms of emergent order.

  5. Arnold, you might be interested in Tanner Greer’s long post [Oswald] Spengler and the Search for a Science of Human Culture. He says,

    “Like many studies of “culture” that came after his, by envisioning culture as some sort of system external to the people whose thoughts, actions, and desires comprise it, Spengler has simply dressed up the assumptions of folk sociology in fancy theoretics.

    “One might contrast this approach to the study of culture to the two warring branches of evolutionary anthropology now attempting to create ‘scientific’ understandings of cultural production and transmission.[7] The first labels the object of its study “cultural epidemiology.” It has also been called the “Paris School” of cognitive anthropology. The second favors the term “cultural evolution” and is sometimes called the California school of evolutionary anthropology. [Pascal] Boyer belongs to this first group; Dan Sperber deserves proper credit as the father of the school, and you can find many of its current members blogging at the Culture and Cognition website. Though their output is varied, Olivier Morin’s How Traditions Live and Die, and Boyer’s Minds Make Societies are the two most important statements of the Paris school perspective on the issues posed in this essay. The California school, having started with anthropologists Peter Richerson and Robert Boyd in the 1980s, now has their folk scattered among anthropology, psychology, and economics departments across the Anglosphere. Joe Henrich’s The Secret of Our Success and Cecilia Heyes’ Cultural Gadgets are recent, representative anchor texts of this research tradition.”

    But after talking about the two “schools”, he concludes, “Both California and Paris school researchers hype their respective project as having the transformative potential that Darwin’s theory had on the study of biology. But both currently lack the theoretical sophistication to even attempt [many important questions].”

  6. Do remember admiring a paper North wrote on the law merchant. I had come to him via Dierdre McCloskey’s virtues trilogy. Also read some of his other work but it didn’t stick memory wise. The ocean of writing on development history seems unfathomable and impossible to discern what is different and how from what was recorded in the past. It seems simpler now to go back to the old seminal texts. Henry Home, Lord Kames’ Sketches of Human History has been a particularly thought-provoking source. North’s notions of the role elites play in development call to mind Homes’ observation:

    “The first is, that as military force is essential to every state, no man is exempted from bearing arms for his country: all are bound; because no person has right to be exempted more than another. Were any difference to be made, persons of figure and fortune ought first to be called to that service, as being the most interested in the welfare of their country.”

    Sending Bezos and Zuckerberg and academics to boot camp might not be the worst idea.

  7. How is “status” different from “class”?

    I used to dismiss class talk as being just recycled Marxism. I still think that Marx set back our analysis and understanding of social class by at least 100 years by his simplistic division of society into two classes of capitalists and workers, with the basis of class/status being ownership of capital.

    Many conservatives focus on class also. The novels of Tom Wolfe are mostly concerned with social class and status, and he was no Marxist! British conservatives seem to have a better feel for class than Americans.

    American libertarians often seem enamored with the notion of a “classless society” in a libertarian America. Meanwhile, American progressives appear to have turned class thinking into “identity” politics.

    You are right that politics is not about policy. It is about status. Is status the same thing as power?

    We can look back on the Trump event in terms of status. Trump had a penthouse in Manhattan, but he was still a guy from Queens, and he could never break into the upper classes no matter how rich or famous he became. He was a bit like the Great Gatsby himself. Even a Wharton degree wasn’t enough.

    The Harvard-Yale Club has other ideas about who is entitled to rule. JFK was Harvard. Gerry Ford was Yale. Bush #1 was Yale. Dukakis was Harvard. Bill Clinton and Hillary Clinton were Yale. Bush #2 was Yale and Harvard. Al Gore was Harvard. John Kerry was Yale. Obama was Harvard. Romney got a double graduate degree from Harvard. As for the Supreme Court, until Amy Barrett was installed a few months ago, every justice had a law degree from either Harvard or Yale.

    Does this sound a bit like a rigid class system? People like Nixon, Reagan, and Trump were dismissed because they didn’t have right status.

    A lot of Trump supporters have gotten tired of being ordered about their “superiors.” The pandemic made it worse when the ruling class imposed restrictions that bankrupted many of the working class even as its members felt free to violate their own restrictions.

    Trump is leaving. But the issues of class, status, and privilege aren’t going away. I fear it will get much worse.

  8. I remember in 2005 that Kling seemed to be somewhat influenced by Ray Kurzweil’s book, The Singularity is Near in the sense that he took it seriously while still being very skeptical of several claims. I wonder what he thinks of that 15 years later.

  9. North’s work points to why bad states are not easy to change. All go back to the idea that stable political order precedes most viable economic growth. Unstable states can grow, but not steadily or reliably in the long run. And limiting and constraining violence between factions is a core key. So the idea of too much diversity is quite relevant to the state of most nations.

    • Douglass North (1920-2015) did most of his research well before joining Wallis and Weingast to write “Violence and Social Orders” (published in 2009). His pre-W&W research was huge but he never presented a framework for analyzing social order and developed a theory of the evolution/history/change of social order. Late in the last century North was seen as a founder of the new “institutional economics” but there were many predecessors, and at that time there were others like Avner Greif that could claim a deeper knowledge of the role of institutions in the path to the modern economy –you can read AG’s with that title published in 2006 but circulated much earlier.

      By 1990, I was sure that the main problem with North and most other institutional economists was their total ignorance of the history of legal systems. Although “Violence and Social Orders” was a big step forward for North, it was too late in his life and the book failed to develop the framework and theory of social order that I was expecting (at the time of its publication, I was retired and working full time in their development). Since 2009, both Wallis and Weingat have been contributing to their development (I encourage you to read about their latest works on their websites, and appreciate how much more attention they pay to social norms and legal systems). BTW, my own “amateur” research is based on Hayek’s last words and the many studies of the history of cooperation and conflict (including how alternative legal systems have contributed to contain our dark side as a precondition to take advantage of our bright side). We all still have a lot of work to do.

  10. I do know that Greif was very heavily influenced by North and in fact collaborated on him with a paper. I am told that even his dissertation and subsequent work were vetted by multiple visits to Washington University to speak at the Political Economy Center there.

    Wallis was a North student in graduate school and collaborated with North extensively (especially in their joint work on transactions costs in national income). As for lawyers, North did consult with multiple law professors but he apparently saw those things you mentioned as illustrations of how law constrained behavior but he was skeptical because he saw law not for itself but how it was enforced as being crucial. He only came around later to Greif’s view that institutions are a coevolution of rules, norms and behavior hence his emphasis on cognition. North always emphasized the differences between formal rules — such as law or constitutions — and law as it actually played out in a given nation or society. By this standard, two random countries that adopted the US constitution would not necessarily have the same institutions and would be unlikely to.

    • The research on social norms (including informal and formal norms) has been quite extensive but still incomplete. It was already extensive by 1990 and accelerated since then. One way to assess that research is to use the epilogue of Hayek’s Law, Legislation, and Liberty Vol. 3, for developing a framework for analyzing social order (you may know that “social order” is a term that has several alternative meanings). Once you can develop it and authenticate it by applying it to today’s social order, you can attempt “reverse engineering” to understand how it was put together in the past 10,000 years.

  11. Our civilization is based both on capitalism, represented here nicely, and Christianity. Almost completely absent explicit reference.

    Christian socialism, different from communism but kind of easily conflated in some ways, is quite important for looking at feelings and motivations. Pope JP II wrote a great encyclical, centesimus-annus:
    http://www.vatican.va/content/john-paul-ii/en/encyclicals/documents/hf_jp-ii_enc_01051991_centesimus-annus.html

    This was, itself, a 100 yr review of the prior Rerum novarum

    Culture is upstream of politics, and always part of economics. Christian religion is the single most important cultural influence in “The West” – but most Libbers mostly ignore it most of the time. Or, worse, take a simplistic yet misleading simplification of parts of it and think they understand it. Or attack such straw man ideas and arguments.

    New in the last decade is the idea of a “steel man” argument, which I find very valuable – what is the strongest argument on the side of those you disagree with?

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