Well, the time has come to propose the new economic paradigm that I’ve been alluding to for a while now. First, though, huge thanks to everyone who has been commenting and giving awesome feedback! The level of interest and very thoughtful suggestions tell me that there is a genuine desire and opportunity in this idea to construct a new economic paradigm. I think we might really be onto something here together, and I’m very excited about what the future might hold for this undertaking. So thank you, thank you, thank you all, once again!
I would like to begin by briefly discussing two of those suggestions as a means to make a mental transition, of sorts, from our original laundry list and three paradigm requirements to the paradigm itself. The first of these suggestions concerned the glaring absence of human population growth (and concomitant with that, women’s issues) as an item on our laundry list. As I (hopefully sufficiently ashamedly) replied then, population growth is a “third rail” issue for me, as it is for many other progressive activists. Avoidance of this issue demonstrates quite clearly how difficult and complicated some of these problems are to address. The very personal decisions we all make on a daily basis, from what we eat and wear and drive to whom and how we make love, all have impacts on the planet’s biosphere and the quality of life for future generations.
Now, if we go back to our original laundry list to add Population Growth to it, we can see that I sorted the items in an order that ranges from simple problems at the bottom to knotty problems at the top. [A note: referring to our previous diary, by simple, we do not mean first-order. All of the problems we are addressing here are higher-order. By simple we mean simple relative to the really hard higher-order problems. To the old paradigm all the problems we are addressing are hard and knotty.] Population Growth belongs at the top of the scale at knotty problems, with Consumption Ethic right below it. What must our paradigm do to help us solve such knotty problems? To answer this we need to return to the first two of our paradigm requirements. These are, again:
Understanding: first and foremost, a new paradigm provides new insights to existing problems that the current paradigm does not or cannot provide;
Vision: next, a new paradigm provides new investigative approaches that lead in novel directions inconceivable within the existing paradigm;
I would posit that Population Growth and the Consumption Ethic fall into the latter category. Just gaining a better understanding of these problems is not going to solve them; their complex nature and sources require an approach with deeper insights and radically new approaches. Now, the above paradigm descriptions are quite general and so not very helpful when we start looking at individual problems. So let’s get more specific on what we want our new paradigm to do. Any and every new paradigm should provide the following three specific items:
A General Principle. This is just the basic idea behind the paradigm, with an easily understood simple concept. An example from physics is the general principle of Relativity.
A Conceptual Framework. This is a set of functional rules, or operating system. An example from physics is the various quantum states that particles can exist in.
A Radical New Feature. This is a singular insight that totally transforms the way we look at a fundamental aspect of the reality of the system. An example from physics is wave-particle duality.
Knotty problems can’t be solved by just understanding them better with a new conceptual framework, although certain aspects of them might be after the issue is addressed in the main. To incentivize people from consuming too much stuff, for example, is going to require addressing the issue at a deeper cultural psychological level, not just measuring and providing feedback regarding impact via True Cost Accounting and similar metrics.
Some problems aren’t quite as difficult, however. An example of this is the second comment I received that pointed out a deficiency in the laundry list item, Limits to Growth. The commenter correctly observed that some types of growth are desirable and should be encouraged, especially when looking at alternative measures of wealth and progress. What I should have been clearer on is that we need to better define the various meanings of growth. One of the tasks ahead of us when we begin this national discussion on the issue of economic growth (a discussion we will be having eventually, I am certain), is to develop a system to describe and characterize the different types of growth so that we can enact better growth/steady-state economic policies. This undertaking can be readily accomplished with a conceptual framework alone; no radical new feature is necessary for this relatively simple task.
Okay, I think we’re ready to move on. In the remainder of this diary I will first give some historical background to the new economic paradigm, and then describe and unpack its essentials through the story of how I discovered it.
And so, we begin, below the fold, where I said in my last diary I would be taking us: the boreal forests of Siberia. So zip up your parkas and lace up your mukluks, Kossacks, we’re heading off into the wilderness in search of a new economic paradigm!
Pyotr Kropotkin was an extraordinary man who lived an amazing life. Why his story has never been turned into a blockbuster Hollywood movie is a complete mystery to me. Born in 1842 to a family of Russian aristocrats and heir to numerous estates, he renounced his princely title at the age of twelve and went on from there to leave an indelible mark on world history. If you are unfamiliar with his life and work, I highly encourage you to become acquainted with him.
At the age of 22 Kropotkin was put in charge of a geographical survey expedition into the vast unexplored regions of Siberia. As he observed and cataloged the native flora and fauna and came to know the local peasant population, he began to notice that there was far less “survival of the fittest” going on in the harsh Siberian wilderness than he had anticipated under the prevailing theory of Darwinian evolution. What he found, in fact, was that competition was much less a driver of natural selection than was cooperative behavior. The more he looked the more he found organisms working together cooperatively to survive. These experiences profoundly shaped his worldview, resulting in the publication of his 1905 book Mutual Aid, where he described the concept of mutualism, and what is now known in the natural sciences as symbiosis:
A soon as we study animals — not in laboratories and museums only, but in the forest and prairie, in the steppe and in the mountains — we at once perceive that though there is an immense amount of warfare and extermination going on amidst various species, and especially amidst various classes of animals, there is, at the same time, as much, or perhaps even more, of mutual support, mutual aid, and mutual defence amidst animals belonging to the same species or, at least, to the same society. Sociability is as much a law of nature as mutual struggle. Of course it would be extremely difficult to estimate, however roughly, the relative numerical importance of both these series of facts. But if we resort to an indirect test, and ask Nature: "Who are the fittest: those who are continually at war with each other, or those who support one another?" we at once see that those animals which acquire habits of mutual aid are undoubtedly the fittest. They have more chances to survive, and they attain, in their respective classes, the highest development and bodily organization. If the numberless facts which can be brought forward to support this view are taken into account, we may safely say that mutual aid is as much a law of animal life as mutual struggle; but that as a factor of evolution, it most probably has a far greater importance, inasmuch as it favors the development of such habits and characters as insure the maintenance and further development of the species, together with the greatest amount of welfare and enjoyment of life for the individual, with the least waste of energy.
The book influenced a large number of people and played a part in fomenting the Russian revolution. Due to this association, as well as Kropotkin having become an ardent supporter of the Anarchist Movement, the scientific study of anything having to do with cooperative behavior in general, and symbiosis in particular, was strongly discouraged, if not outright suppressed. Ruthless competition and “nature red in tooth and claw” became the only allowable view in both economics and the natural sciences. For the reader interested in the fascinating history of symbiosis in this regard, I recommend Jan Sapp’s 1994 book
Evolution by Association: A History of Symbiosis.
The natural sciences eventually came to accept symbiosis as a not-insignificant part of evolution after Lynn Margulis’ (of Gaia Hypothesis fame) groundbreaking work on endosymbiosis was published in 1966 (after 15 journal rejections!). Since then, the scientific study of symbiosis has increased substantially, and it has become apparent that it plays a very significant role in nearly every ecosystem on the planet.
So how has the economic side of this long-neglected area of study fared during this recent revival? Not quite nearly as well, unfortunately.
The field of Evolutionary Economics, and its inheritor, Complexity Economics, has contributed a great deal to our understanding of economics. By looking at the many complex naturally-occurring evolutionary systems, economists have gained tremendous insights into the workings of our own human economic systems. It is a very productive and active area of study.
But pick up any one of the hundreds of volumes of textbooks available on the subject and look up symbiosis in the index.
You’ll be lucky if you find any more than one or two pages to look at. If you find one at all.
Unpacking the Paradigm
Four years ago, finding myself a newly-unemployed Environmental Engineer in his 50s unable to locate work in a marketplace awash with much younger and hungrier environmental engineers fresh out of college, I decided to put aside a return to Corporate America for a time and commence full-time work on a project that I had been intermittently researching for the previous three decades. The project was basically designing a new economic model and message that I hoped would facilitate the transition to a global steady-state economy by integrating it with growth economics in a new way. The time had finally come to really dig into all those journal articles and textbooks on Environmental, Ecological, and Natural Resource Economics I had gathered over the years and get this thing done once and for all.
About midway through the project, the best name for it, which I had been pondering for some time, suddenly dawned on me: Symbiotic Economics. It described my new model perfectly and succinctly. A general Internet search yielded no attachment of the name to any research I could find, so I put the item aside, confident I would not be intruding on any other researcher’s turf, and returned to constructing and describing the model.
As I approached a time to investigate potential publishers, I revisited my name claim with a more thorough search to verify its availability, and this 1998 paper by John P. Watkins, an economist at Westminster College in Salt Lake City, Utah, turned up:
Towards a Reconsideration of Social Evolution: Symbiosis and Its Implications for Economics
John P. Watkins
Journal of Economic Issues
Vol. 32, No. 1 (Mar., 1998), pp. 87-105
ABSTRACT
Renewed interest among economists in naturalist Charles Darwin's theory has generated confusion regarding the meaning of social evolution. The debate between the old institutional and neoclassical economists finds a parallel in a debate that has recently emerged among biologists. Recent research in biology, however, cast doubts about the simplistic vision of evolution presented by the neo-Darwinists. The theory of symbiosis in particular makes two points. First, evolution is not always gradual. New species may arise from the merging of two or more species. Second, evolution may also result from "cooperation." The symbiotic theory focuses not on the individual organism as the unit of "selection," but on the relationships that in fact define the "individual" organism. Historians of biological science trace the origins of modern symbiosis theory to the reaction on the part of socialists and anarchists to the emergence of the market economy in the nineteenth century. For years, biologists studying symbiosis were excluded from "polite biological society." Their theories were either dismissed or met with open hostility. The "market mentality" underlying the neo-Darwinian synthesis led biologists to look for conflict.
This greatly piqued my curiosity, as I had recently started having some serious problems with the model I was building. Simply put, it was getting too big and complex. I was trying to look at too many systems with too many variables using too many metrics. It just wasn’t working like I hoped it was going to.
One thing I had never done while deciding that Symbiotic Economics sounded like a great name, was actually look a little deeper into what symbiosis was beyond the way it is commonly used, namely, two unlike species cooperating with each other in a mutually beneficial relationship (in my defense, being a physics and chemistry person, I am inclined to equations, thus rather biology-avoidant, intellectually. Any natural science field with complexity above the biochemical level I consider to be essentially magic). Well, it turned out that there is much more to symbiosis than that. There are actually six different types of symbiosis found in Nature, as follows:
Mutualistic: Both organisms benefit from the relationship
Commensal: One organism benefits from the relationship with no net effect on the other
Neutral: Relationship between the two organisms has no net effect on either
Amensal: One organism is negatively affected from the relationship with no net effect on the other
Parasitic: One organism benefits to the detriment of the other
Synnecristic: Both organisms are negatively affected by the relationship
Here's the above represented visually, which always works better than words.
[Edit: The above image was helpfully extracted from
this "one-pager" by Tinakori road. Thanks, Tinakori! :) ]
This immediately struck me as something that might hold the answer to my modeling problem. I won’t go into the details here, but it essentially did. By using these preset-by-Nature categories of socio-economic relationships, what was intractable suddenly became tractable. But this was more than just a handy math trick, however. Looking through this new Symbiotic Economics (SE from here on out) lens at the different socioeconomic system layers, this approach was taking on a distinctly paradigm-like feel about it. Not only did it solve my complexity problem, but it had applications far outside areas I hadn’t even considered in the first place.
I never did do any “tracting” with this on my model, however, in part because of what happened next.
All the time I had been noodling away on my project using pre-2008-crash neoclassical economic models, a growing chorus of voices was sounding the alarm that the fundamental premises of those mainstream models might be seriously flawed and in need of fundamental revision. I hadn’t noticed that this had been going on until my SE discovery. Nor had I ever examined, let alone questioned, the fundamental premises and assumptions of the entirety of modern economic theory and practice. So I did, through the SE lens. And that’s when it hit me as to the incredible potential of SE. It might indeed be a completely new paradigm. And it all came down to one unbelievably simple concept that could be flipped as easily as a light switch.
Agency.
One of the fundamental building blocks of economics is the description of how "agents" behave in economic systems. Agents can be individuals, households, businesses, ecosystems, resource bases, and other actors and decision-makers. In order to reduce the real-life higher-order behavior of agents to first-order tractability, various assumptions are made about them, e.g., they make rational decisions (Rational Choice Theory) based on “maximizing their utility”. The many different fields of and approaches to economics, such as Behavioral and Institutional Economics, have developed as a way to better account for and more simply describe the complex behaviors of various types of agents. [note to Keynsian commenters from previous diaries: although I have not finished researching this yet, as far as I can tell, the approach merely shifts the burden of RCT from individuals and households to supposedly more informed, objective, and thus rational national policy-makers, which doesn’t seem to me to solve the underlying problem. Bureaucrats can be just as irrational as consumers, if not moreso on occasion.]
There is one assumption about agents that is common to all these different fields and approaches, however: autonomy. In all economic theories agents are assumed to make their decisions by themselves, unconnected and apart from other agents, other than information flow to or from the agent. The individual agent making individual decisions is the most basic building block.
That is not representative of reality. In real life people make decisions based on more than just information flow to and from another person. We are intimately connected with that other person, albeit to varying degrees and types. When we interact with other people, whether we are consciously aware of it or not, that relationship itself has unique definable characteristics, which, for all practical purposes, allow us to treat it as an agent in itself. We evaluate other agents in a decision making situation just as much, if not in some cases more, by looking at the relationship(s) between those other agents, as we do based on information directly from the agents themselves. We define ourselves through our relationships with other agents. [(Edit addition): Although this is intuitively obvious to people familiar with Buddhist, holisitic, systems theory, and deep ecology concepts, it cannot be incorporated into any existing economic system using a conceptual framework whose basis is agents acting individually.]
In SE the fundamental building block is a minimum of two agents linked together in a relationship of one of the six types above. A direct outcome of this fundamental SE axiom, that no agent exists individually or acts autonomously, is that the nature of the relationships in a given system itself becomes a cascading-outward emergent property, thereby enabling and translating a quantifiable economic connection all the way from individual agents to the entire planet itself. This approach might also be thought of as a bridge between what is called “microfoundations” and macroeconomics, thus becoming a form of “mesoeconomics” that is not founded on either of those two cognitive-limited poles, but rather, on the symbiotic relationships inherent in Nature as a guide and tool for conducting quantitative analyses such as Agent-Based Computational Economics.
[(Edit addition):The SE Conceptual Framework can be thought of as a type of "Impedance Matching" device. Impedance, a term used in electrical engineering, is a measure and characteristic of the opposition of a circuit or system to energy flow from an outside source, and is determined by the number and type of components in the system. Neoclassical economic concepts and models, based on the limited first-order scope of interconnections resulting from the individualist agency basis, have a much greater impedance than the vastly more complex nature of actual higher-order economic systems. The SE Conceptual Framework, with its six naturally-defined categories of economic interactions, might be able to bridge the impedance mismatch of those two approaches to conceptualizing and modeling economic systems. (Thanks to Bob Guyer for making that and the above connection for me in the comments. I probably did a piss-poor job articulating the above insight, but this is all a work-in-progress. Thanks, Bob! :) ).]
Incidentally, I am not the only person that is discussing the efficacy of this approach. I recently discovered that other researchers in the Sociological, Behavioral, and Economic sciences are beginning to take a closer look at it, as well.
I think I’ll leave it there for now… so there you have it. That’s the nuts-and-bolts side of the Symbiotic Economics paradigm proposal as it now stands, very roughly summarized . In parts of some future diaries I’ll explain how we’re hoping to couple this newly-developed analytical framework to the SE Conceptual Framework and field test the concept locally with the help of a small seed grant we’ll be getting later this year. I’ll be posting the first Symbiotic Economics Initiative Update Diary tomorrow outlining the scope of the initial project, as well as a number of other initiatives in varying stages of development [EDIT: Obviously i didn't do that, my apologies. 'Tis forthcoming.]. But this is only the very first step for us locally. Much refinement of the approach will be necessary: conceptually, computationally, and in its application and implementation aspects. If you feel that this idea is worthy of further investigation your hammers and chisels would be greatly appreciated!
Thanks for your time and attention, folks, I hope you found this interesting and enjoyable to read, and I look forward to your comments!
~ vasudhaiva kutumbakam ~
scott
POSTSCRIPT: Some food-for-thought links:
This paper on interpersonal utility measurement.
This article from the Post-Carbon Institute on the historical problem of agency.
Link to first previous diary: http://www.dailykos.com/...
Link to second previous diary: http://www.dailykos.com/...