Economics fails to explain why Homo economicus struggles with delayed gratification, but ecology can offer some historical perspectives.
Ecology and economics often build on the same theories, but ecology can explain better why Homo economicus often fails at delayed gratification.
I am pre-publishing this sequence of essays here and in social media to elicit comments and other feedback. They will form the framework for my next book, Darwin, Dada, Dalí, Duke, & Devadevàya.
Ecology and Economics
Ecology and economics are both derivatives of the same Greek root, οἶκος/oikos, which refers to the house or home. Ecology studies plants and animals in their home within nature, and how they respond to the natural environment. Economics studies people in their home within civilization, and how they respond to the financial environment.
So we have ecology and economics, but which came first? Darwin’s biological On the Origin of Species was heavily influenced by Malthus’s economic Essay on the Principle of Population;[1]The breezy title is actually ‘Essay on the Principle of Population as it Affects the Future Improvement of Society, with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers, … Continue reading that work gave Darwin one of his central insights, the struggle of living things for limited resources. On the third hand (as it were) Malthus was looking at human survivability, which is an ecological question. On the fourth quadrumanid hand, biology can trace its roots back to Aristotle, and even earlier, long before economics began as a formal discipline. But on the fifth hand,[2]Harry Truman wanted a an economist with one hand, and here I am giving him five… the historical roots of all of writing and mathematics appear to arise from the need of early kings to account for their property and their realms.
So arguably, all intellectual activity begins in economics.
Homo economicus
In reality, the question of which is the older field of study is moot. But the consideration is still useful, because clearly ecology and economics have intertwined throughout their histories. This is because biological investment and market investment are still investment. Both focus on how and when to acquire resources, and how and when to divest of, or even abandon, those resources.
By merging biological and market perspectives, however, we can begin to explain some problems in economics. For instance, the real-world Homo sapiens doesn’t always match up well with the hypothetical Homo economicus. As a result, economists struggle to understand why Homo economicus isn’t always rational, and why we are not always dispassionate, analytical, and logical in our choices.
That is why it is advisable to include those biologists who study Homo sapiens in economics. Because while people may not appear rational within a circumscribed, economic approach, when we add in ecological/biological perspectives we often gain clarity. At times, our seemingly irrational choices actually reflect older, completely rational, but biological choices.
Delayed Gratification
There are many examples, but one of the more interesting involves the economic experiments which show that humans aren’t always good at making strategic long-term decisions. The problem of delayed gratification is more understandable, however, when we realize that long-term decisions weren’t possible before our ancestors moved out of the savanna. For billions of years, long-term storing/investing simply wasn’t a thing. All living things have maintained, and continue to maintain, an unending, moment-by-moment struggle for existence. Every day you forage for enough food, water, and other necessities to see you through until nightfall. Occasionally you feast, but more often you go hungry.[3]One of the more sensational examples of this is the oft-told story about how a female preying mantis will often bite the head off of a courting male and eat, while his body continues to copulate with … Continue reading
Which is also true for all of the animals around you, most of them are also living on the edge. So if you don’t eat food when you find it, somebody or something else will, but fast. You struggle every day for territory and resources, and then you invest any surplus in as many babies as you can generate, as fast as possible. Beyond that, there is little in biology that can compare to the modern payoffs provided by delayed gratification.
Winter & Long-Term Investment
In fact, this is the prime reason that our ancestors stayed in Africa for millions of years. The savannas of tropical Africa provide food year-round, while the non-tropical areas elsewhere present a formidable challenge: winter. This is not an obstacle just for humans, almost no primates survive in cold climates. So before early humans could emigrate, they had to acquire skills and strategies for surviving winter outside of the homeland.
Strategies for surviving winter are the beginning of long-term investment. Surviving cold, barren months means food storage in the warmer seasons. A few animals grow heavy fur, build up what fat reserves they can, and continue to hunt or forage through the winter. But they still lose weight. Others build up great fat reserves, and just hibernate. Many animals simply don’t survive: they accumulate a bit of excess, invest it in eggs that they hide away in the fall, and then just die.
Over-Wintering
To survive winter, however, humans did several things that were entirely unprecedented. Instead of heavy fur, we made clothes and shelter, and we harnessed fire. Rather than rely solely on our fat reserves while we hibernated, we figured out ways to store food externally, particularly by drying and smoking meats. Those inventions allowed us to survive in the cold months.
These were so effective, in fact, that rather than die in the waning fall months, humans actually expand our numbers. Our ancestors were able to perform an unprecedented survival tour de force: humans are just about the only animals surviving in wintry climates who continue producing babies year-round. While the rest of life in the non-temperate zones attempts to time offspring production in response to winter, humans prove that we are so effective that we can ignore such constraints.
The Political Animal & The Arms Race
Finally, in the greatest invention supporting civilization, our ancestors learned to fire clay and make pottery. This allowed us to store food in vast quantities, such that we could survive without foraging in winter. This meant that we could begin to settle in fixed locations year-round.
Our ability to store food, however, attracted something beyond rats and bears. A new predator appeared: our neighbors. We found that raiding one another could be easier than spending months harvesting and storing food.
And that created the first arms race. Around our food, we needed pottery and other protective containers. Around our pottery, we needed stout homes. Around our homes, we needed a village and the safety in numbers it provided. Around the village, we needed walls. And eventually, within the walls we needed a warrior class, who both protected our reserves, but who also plundered the reserves of others.
For an ecological theory of sexual dimorphism, click here.
Food to Fungibles
Gradually, our ability to store resources advanced until we could store ‘food’— including those things fungible with food, particularly metals and other durable resources—in near-limitless quantities. This is evidenced by the fact that a handful of billionaires today make more than the bottom half of the world combined. In effect, a dozen billionaires have stored enough ‘food’ to feed, clothe, and educate almost all of the poor children of the world, which would irrevocably alter the trajectory of humanity.
This jarring juxtaposition between the billions of dollars concentrated at the top of the survival pyramid, and the billions of people smeared world-wide underneath it, starkly illustrate the new storage vs the old scramble, the economic vs the ecologic.
The Continuing Struggle…
The economic struggles of civilization left us with a brutal legacy. Click the image for more information.
As all those impoverished billions show, however, the advent of civilization has brought little improvement for most of humanity. Just as in the savanna, and just as with peasants throughout history, today the world’s poorest barely eke subsistence from the land, put aside what little they can, and hope that criminals, the king, and the rats stay away long enough that they can survive the winter. As the news reports from the poorest parts of the world show, many still fail.
Throughout history and into the modern world, annual death tolls were horrific. Estimating those death tolls is another reason economists need to talk to biologists. The economist, the historian, and the demographer might pore through mountains of records to estimate historical death tolls, but the biologist can refer to our fundamental concepts, do it more quickly, and probably, more accurately. Using a biological approach, we can quickly estimate that over ¾ of the population died within a typical generation.
Biologists understand that all living things are held at a ‘carrying capacity’, i.e., a particular parcel of land can only support so many representatives of a species. This general constancy in numbers means that, on average, only two offspring from any female will survive to the next generation. In the past, human birth rates probably hovered around 6 children per female.[4]Bryant Robey, 1993. ‘The birth rate decline in developing countries,’ Outlook on Agriculture 22, no. 4.:221-224. Max Roser, 2020. ‘Fertility Rate,’ OurWorldInData.org. This means that the family/reproductive unit numbered 8 people. Taken with the constancy of the carrying capacity, we can see that in any average generation, clearly 6 of those 8 people, or ¾, perished.
Survival Pressure, Genes, and Culture
These death rates exerted great selective pressure on humanity, and forced us to make hard choices, hard economic choices. But they were equally biological choices. And we can begin to understand the competing pressures between the savanna and eat-it-when-you-find-it, and wintry climates and storage-as-survival.
Children seem to struggle the most with delayed gratification, suggesting that eat-it-now represents some measure of genetic behavior. With time, practice, and education, however, many of us learn to save and invest, and prepare for barren times. It is unimportant, however, whether we inherit those choices through our culture, or through our genes. In all cases we can see how variations of investment logic, producing rational solutions, emerge in both.
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Picture of Money Plant courtesy Mizianitka.
Footnotes
| ↑1 | The breezy title is actually ‘Essay on the Principle of Population as it Affects the Future Improvement of Society, with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers, Printed for J. Johnson, in St. Paul’s Church-yard, 1798.’ You can read it here. |
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| ↑2 | Harry Truman wanted a an economist with one hand, and here I am giving him five… |
| ↑3 | One of the more sensational examples of this is the oft-told story about how a female preying mantis will often bite the head off of a courting male and eat, while his body continues to copulate with her. Then she devours the rest of him. Turns out she doesn’t usually eat him if she’s well-fed. |
| ↑4 | Bryant Robey, 1993. ‘The birth rate decline in developing countries,’ Outlook on Agriculture 22, no. 4.:221-224. Max Roser, 2020. ‘Fertility Rate,’ OurWorldInData.org. |
Who knew biology and economics could be so interesting?
Thanks, Ann.