Tuesday, October 04, 2011

Another Review of Robert Frank's 'The Darwin Economy'

Matt Thompson, an adjunct assistant professor in the Department of Sociology and Criminal Justice at Old Dominion University. He was once cast as a soldier in Andrew Jackson's army in a theatrical production on an Indian reservation, reviews Robert Frank’s new book, ‘The Darwin Economy: liberty, competition, and the common good’, Princeton, New Jersey, Princeton University Press. September 2011 (reviewed on Lost Legacy, 23 September):

“Darwinian Tax Reform” posted on Savage Minds blog (HERE):

I think Matt Thompson understands Darwinian natural selection better that Robert Frank:

Prima facie the notion of applying ecological theory to challenge our understanding of the national economy sounds intensely intriguing. So it was with great expectations that I read economist Robert Frank’s recent NYT piece based on his new book, “The Darwin Economy.” He presents the same idea in precis, here. Unfortunately the results did not live up to the promise of such an innovative idea. …

Nowhere does Darwin say that competition among individuals does not always produce results beneficial to the group. That is a conclusion Frank comes to because he’s reading through this lens that forwards agenda for new tax policy. Natural selection doesn’t care about groups, it only ever acts on individuals. It doesn’t really care about survival either, rather “winning” at natural selection means reproductive success. Evolution is the aggregate result of natural selection shaping the frequency of variations within a population. Therefore, no bull elk would have a huge and unwieldy rack of antlers if the benefits of having them did not outweigh the costs. …

Something’s wrong here and it begins with Frank’s misreading of Darwin. The example of elk’s antlers is, properly speaking, one of sexual selection. In “On the Origin of the Species” (1859) Darwin presented his theory of evolution by natural selection, which wonderfully explained why all polar bears have thick coats and all giraffes have long necks. Over time any trait beneficial to the individual will spread through the population if it helps them adapt to selective pressures in their environment. But Darwin struggled to explain things like the ornate patterns of butterfly wings, which don’t seem to have anything to do with the environmental pressures, or the peacock’s tail which, frankly, seems to be detrimental to the individual’s survival.

It wasn’t until “The Descent of Man” (1871) that Darwin hit upon the theory of sexual selection. These things are not to enhance the survival of the individual or help them adapt to the environment but to advertize their fitness as a mate. Frank’s elk example fails because he only considers the male’s point view. Males compete, but females choose. It is female choice that has led to spread of large antlers through the elk population not male competition.

Males and females have different reproductive strategies stemming from the fact that they invest different amounts of energy into the reproductive process. Females have a limited number of eggs, when they are pregnant they cannot take another mate, and after giving birth spend time and energy caring for the young. In terms of reproductive success, females do best when they are choosy and pick a male endowed with the best genes. Males can produce sperm by the millions and after taking one mate can increase their fitness by quickly taking another. Males improve their reproductive success by competing with other males in an effort to increase the quantity of females they mate with.

If you can take that and apply it to economics, great. But that’s not what Frank does. To him Darwin’s theory is just a handy metaphor.

Nowhere does Darwin say that competition among individuals does not always produce results beneficial to the group. That is a conclusion Frank comes to because he’s reading through this lens that forwards agenda for new tax policy. Natural selection doesn’t care about groups, it only ever acts on individuals. It doesn’t really care about survival either, rather “winning” at natural selection means reproductive success. Evolution is the aggregate result of natural selection shaping the frequency of variations within a population. Therefore, no bull elk would have a huge and unwieldy rack of antlers if the benefits of having them did not outweigh the costs. …

Frank’s usage of Darwin does not go beyond analogy. Essentially it amounts to little more than a rhetorical move whereby the economist seeks to borrow Darwin’s authority to sell his idea of a progressive consumption tax. Incidentally, I had never heard of such a thing before and maybe it’s a worthwhile policy to consider. But it has nothing to do with Darwin or natural selection.


Comment
I concur with Matt Thompson. I do not believe that Frank has properly stated Charles Darwin’s views. I do not accept that Frank properly portrays Adam Smith’s ideas on competition. He is too much befuddled by modern attributions of what he calls Smith’s ‘disciples’ – more like his epigones.

Whether economists in a hundred years switch to praising Charles Darwin as the ‘father of economics’ in place on Adam Smith is an unknowable proposition, hardly worth arguing about. I am not sure even that proposition is worth arguing about in place of claims that Adam Smith is due that title, whatever it means.

I do know that Frank’s understanding of Darwin is as credible as his misunderstanding of the Adam Smith born in Kirkcaldy in 1723, at least on the evidence of ‘The Darwin Economy: liberty, competition, and the common good’, Princeton University Press.

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1 Comments:

Blogger Xerographica said...

Anarcho-capitalists love the invisible hand. They believe that the private sector can produce all goods better than the public sector can. In other words...they believe that private organizations are "fitter" than public organizations.

So...what would happen if, all things being equal, we applied the invisible hand to the public sector?

This would simply involve allowing taxpayers to directly allocate their taxes among the various government organizations at anytime throughout the year.

Would applying survival of the fittest to government organizations result in the government going extinct?

The most redundant/inefficient government organizations would lose funding...the scope of government would narrow...and the tax rate would decrease accordingly.

The problem for the anarcho-capitalists is that not all government organizations can be currently considered "redundant". There's no non-profit organization dedicated to national defense.

Another "problem" is that private healthcare has to operate at a profit while public healthcare does not. Assuming that public healthcare adapted and became efficient then it would always be fitter than private healthcare...which would result in private healthcare going extinct...well...mostly.

Of course, that "problem" could possibly be solved by anarcho-capitalists by starting a non-profit organization dedicated to providing free healthcare.

Well...however you spin it...applying the invisible hand to the public sector would have amazing positive externalities for everybody. The resulting division of labor between taxpayers would reveal the ideal scope of government.

12:35 a.m.  

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