9.19 Appendix 2: A Smarter Way of Interacting, not Socialism
195
of the commons” and cannot produce average levels of profit comparable to those
earned by “homo socialis”.
35 In conclusion, an economy in which externalities are
considered and “homo socialis” can thrive is expected to produce better and more
sustainable outcomes. From a socio-economic and individual perspective, deciding
like “homo socialis” is a smarter way of decision-making. It is far superior to an
economy in which “homo economicus” dominates and social policies try to fix the
damage afterwards (if at all).
Finally, let me address the question of whether friendly, other-regarding behavior
is more likely if people have a lot of resources and can “afford” to consider the
interests of others, or whether it also occurs under particularly bad conditions. In
fact, in the desert and other high-risk environments, people can only survive through
cooperative behavior. However, other-regarding behavior can also create benefits in
low-risk environments, in which people could survive by themselves. By considering
the externalities of our own behavior, our socio-economic system can continuously
improve so that it produces increasingly better payoffs.
36 In other words, “homo
socialis” improves the performance of a socio-economic system, creating on average
greater advantages for everyone. Even in a world with large cultural differences,
it seems that those countries and cities achieve a particularly high quality of life,
which manage to foster other-regarding behavior and consider externalities. As I said
before, friendly, other-regarding behavior is to everyone’s benefit, if enough people
(inter)act in this way. Nevertheless, it would be desirable to develop institutions
that protect “homo socialis” from exploitation by “homo economicus”. Reputation
systems and merit-based matching are such institutions, which can help to produce
better outcomes in a globalized world.
References
1. F. Galton, Vox populi, Nature 75, 450–451 (1907).
2. J. Surowiecki, The Wisdom of Crowds (Anchor, 2005).
3. S.E. Page, The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools,
and Societies (Princeton University, 2008).
4. A.W. Woolley, C.F. Chabris, A. Pentland, N. Hashimi, Evidence for a collective intelligence
factor in the performance of human groups, Science 330, 686–688 (2010).
5. D.N. Thompson, Oracles: How Prediction Markets Turn Employees into Visionaries (Harvard
Business, 2012).
6. E. Siegel, Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die (Wiley,
2013).
7. N. Silver, The Signal and the Noise: Why So Many Predictions Fail - but Some Don’t (Penguin,
2015).
8. E. Bonabeau and G. Theraulaz, Smarm Intelligence: From Natural to Artificial Systems (Santa
Fe Institute, 1999).
9. S.E. Asch (1951) Effects of group pressure on the modification and distortion of judgments. In
H. Guetzkow (Ed.) Groups, Leadership and Men, pp. 177–190 (Carnegie Press, Pittsburgh).
35 When the latter interact among each other.
36 Wright [27].
195
of the commons” and cannot produce average levels of profit comparable to those
earned by “homo socialis”.
35 In conclusion, an economy in which externalities are
considered and “homo socialis” can thrive is expected to produce better and more
sustainable outcomes. From a socio-economic and individual perspective, deciding
like “homo socialis” is a smarter way of decision-making. It is far superior to an
economy in which “homo economicus” dominates and social policies try to fix the
damage afterwards (if at all).
Finally, let me address the question of whether friendly, other-regarding behavior
is more likely if people have a lot of resources and can “afford” to consider the
interests of others, or whether it also occurs under particularly bad conditions. In
fact, in the desert and other high-risk environments, people can only survive through
cooperative behavior. However, other-regarding behavior can also create benefits in
low-risk environments, in which people could survive by themselves. By considering
the externalities of our own behavior, our socio-economic system can continuously
improve so that it produces increasingly better payoffs.
36 In other words, “homo
socialis” improves the performance of a socio-economic system, creating on average
greater advantages for everyone. Even in a world with large cultural differences,
it seems that those countries and cities achieve a particularly high quality of life,
which manage to foster other-regarding behavior and consider externalities. As I said
before, friendly, other-regarding behavior is to everyone’s benefit, if enough people
(inter)act in this way. Nevertheless, it would be desirable to develop institutions
that protect “homo socialis” from exploitation by “homo economicus”. Reputation
systems and merit-based matching are such institutions, which can help to produce
better outcomes in a globalized world.
References
1. F. Galton, Vox populi, Nature 75, 450–451 (1907).
2. J. Surowiecki, The Wisdom of Crowds (Anchor, 2005).
3. S.E. Page, The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools,
and Societies (Princeton University, 2008).
4. A.W. Woolley, C.F. Chabris, A. Pentland, N. Hashimi, Evidence for a collective intelligence
factor in the performance of human groups, Science 330, 686–688 (2010).
5. D.N. Thompson, Oracles: How Prediction Markets Turn Employees into Visionaries (Harvard
Business, 2012).
6. E. Siegel, Predictive Analytics: The Power to Predict Who Will Click, Buy, Lie, or Die (Wiley,
2013).
7. N. Silver, The Signal and the Noise: Why So Many Predictions Fail - but Some Don’t (Penguin,
2015).
8. E. Bonabeau and G. Theraulaz, Smarm Intelligence: From Natural to Artificial Systems (Santa
Fe Institute, 1999).
9. S.E. Asch (1951) Effects of group pressure on the modification and distortion of judgments. In
H. Guetzkow (Ed.) Groups, Leadership and Men, pp. 177–190 (Carnegie Press, Pittsburgh).
35 When the latter interact among each other.
36 Wright [27].