In the course of a pleasant dinner, conversation turned to dictatorship and the organization of markets. At this point, Roger Myerson, remarked upon the absence of inter-species trade. He was not, of course, referring to trade with alien beings from another planet (who would have discovered correlated equilibrium before Nash equilibrium). Rather, the absence of trade with, say, monkeys. Adam Smith, went further and denied the possibility of trade between animals.
Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog. Nobody ever saw one animal by its gestures and natural cries signify to another, this is mine, that yours………
There is a long history of interactions between men and monkeys of various kinds. Monkeys have been marauders of crops, domestic companions, religious symbols and commodities (meat). The interactions between the species seems to fall into one of three categories: pure conflict (keeping out marauders), long run relationships (pets) or exploitation (used in labs and as entertainment). However, no examples of what one might call trade in the sense of voluntary arms length transactions involving barter. For example, why don’t villagers `pay’ bands of roving monkeys to not pillage?
There is evidence to indicating they would be capable of understanding such transactions. Gomes and Boesch, for example, suggest that monkeys trade meat for sex. Then, there is Keith Chen’s monkey study which suggests that one could teach (some) monkeys about money. From the Jesuit traveller Jose de Acosta in the 1500′s we have the following charming account:
I sawe one [monkey] in Carthagene [Cartagena] in the Governour’s house, so taught, as the things he did seemed incredible: they sent him to the Taverne for wine, putting the pot in one hand, and the money in the other; and they could not possibly gette the money out of his hand, before he had his pot full of wine.
10 comments
February 6, 2013 at 1:10 pm
Steven
Another example of inter-species exchange: http://marginalrevolution.com/marginalrevolution/2012/12/elephants-engage-in-mengerian-indirect-exchange.html
February 10, 2013 at 1:50 pm
rvohra
Dear Steven
Thank you. When I read the headline, I had to pause to think about how elephants might be related to Menger’s theorem on edge connectivity. Until I realized, the reference was to Menger the father rather than the son.
February 6, 2013 at 9:18 pm
Burkhard C. Schipper
It is our fault, not the monkey’s, that we don’t trade with them. When I trade with someone an object, I implicitly acknowledge his/her/its property right to the object before trade. Otherwise, I may simple take it by force.
February 10, 2013 at 1:47 pm
rvohra
Dear Burkhard
I interpret your comment to mean that as we don’t recognize the property rights of monkeys, hence no trade. I’d accept that as an argument for the present. However, what about the distant past when property rights were still not so well defined. Think of the marauding bands of monkeys and the hapless villagers (not a fable if historical accounts are to be believed).
February 10, 2013 at 3:53 pm
Burkhard C. Schipper
Dear Rakesh,
I think the arguments applies to the past as well. Trade became possible when property rights could be enforced either publicly or privately. I don’t know of a good historical study but here is my piece of casual evidence. I come from a region in Germany where there are no castles or other signs of aristocratic grandness. Through this region winds an old trading route connecting the west with the east. Proud fortified towns lie along the route. In the past, whenever some aristocrat turned into a robber baron and pilfered traders along the route, the citizens of the towns would unite and destroy his castle. Note that in a feudal society, it is not a priori clear who had the right to the goods of the traders. But the towns enforced their rights. If they would sign an agreement and pay him not to attack the traders, then nevertheless they would need the same force to be able to enforce the agreement. Why not save the payment and just maintain the force? Now substitute aristocrats with monkeys.
On a second though I think I should qualify my prior comment. When I thought about property rights, I thought about trading of physical objects. But when we also consider trade of services, then I must disagree with Roger Myerson on the absence of inter-species trade. At UC Davis, we have more monkeys than professors. They live in the California National Primate Research Center and trade their services with researchers. A typical experiment would have a monkey perform a service (like looking at the right corner of a computer screen) in return for a squirt of orange juice. Here the experiment wouldn’t be meaningful without attributing to the monkey property rights to his services (i.e., its discretion about looking to the right or left). So perhaps the fact that trade between humans and other species is rare just means that other species don’t have many things that we really need and cannot get cheaper from them (like by force).
February 28, 2013 at 4:09 pm
rvohra
Dear Burkhard
Know the story of the `robber barons’ or Raubritter. If my schoolboy history is correct, their power to levy tolls was derived from the Holy Roman Emperor who also regulated the amount and spacing of these toll collectors (an early form of managing inter-brand competition). During the interregnum, some of these Barons decided to go it alone. Subsequently, the Rhine League is formed, to systematically eliminate the robber barons and restore order. I think there should be a comic book epic in all this but have not seen it yet. OK, so how does this relate to your point: pay tribute to the monkeys but maintain a standing militia in case the monkeys renege. In which case, forget the contract and just use force. Not clear why a standing militia is needed. Why not organize when and if needed. Pay tribute, if monkeys renege, organize posse (OK have moved from the rhine land to the prairie), punish. Monkeys learn lesson, repeat as needed. There is probably a collective action problem here with the posse, have not thought that through.
rakesh
February 9, 2013 at 5:46 pm
Anonymous
“… alien beings from another planet (who would have discovered correlated equilibrium before Nash equilibrium).”
Can you elaborate on this?
February 10, 2013 at 1:42 pm
rvohra
Dear Anon.
Its an allusion to a remark that Myerson made in another context: if there were intelligent life on another planet, in a majority of them they would have discovered correlated equilibrium before Nash equilibrium. Its a preface to an argument of why correlated equilibrium is a more attractive solution concept than Nash equilibrium.
February 10, 2013 at 11:55 pm
Anonymous
I’ve thought CE is more natural/attractive than NE ever since learning what CE means. I would love to see more about this idea, from RM or from anyone else. Can you recommend any sources?
February 28, 2013 at 11:40 am
rvohra
Sorry for the delay in replying. Some of the arguments in favor of CE are: they are well behaved in the sense of being the solutions to an LP and they can be justified on `learning’ grounds. Aumann’s paper proposing CE and the Papadimitriou and Roughgarden paper would be two papers to look at that bracket the literature on this subject.
rakesh