Sunday, January 22, 2012

The Civilizing Process - Pinker Meets Hoppe?

The present post continues with commentary on Steve Pinker’s interview concerning his new book on The Better Angels of Our Nature.

Throughout the entire interview, I kept thinking of Hans-Hermann Hoppe’s work, especially chapter 1 of Democracy: The God that Failed – “On Time Preference, Government, and the Process of Decivilization.” Hoppe and Pinker deal with related topics, though they contradicted or complimented each other in various ways. As it turns out, both authors cite the German sociologist Norbert Elias concerning his two volumes on The Civilizing Process – Volume I on The History of Manners and Volume II on State Formation and Civilization.

In Hoppe’s treatment, the “process of civilization” is initiated by savings-investment, which generates a tendency toward a fall in the rate of time preference.  His discussion is based on the following:

The saver exchanges present (consumer) goods for future (capital) goods with the expectation that these will help produce a larger supply of present goods in the future. If he expected otherwise he would not save. If these expectations prove correct, and if everything else remains the same, the marginal utility of present goods relative to that of future ones will fall. His time-preference rate will be lower.


Higher wage rates imply a rising supply of present goods for previous nonsavers. Thus, even those individuals who were previously nonsavers will see their personal time-preference rates fall.

Hoppe provides further reasons relating to improved health and accumulation of knowledge. Block, Barnett, and Salerno have criticized Hoppe in their RAE article “The relationship between wealth orincome and time preference is empirical, not apodictic.” To say the least, I am skeptical of time-preference theory and, among those in the Austrian School, have views more like those of Jörg Guido Hülsmann.

Hoppe continues by distinguishing criminal from legitimized violence. Regarding crime, he makes the following observation:

The impact of crime is twofold. On the one hand, criminal activity reduces the supply of the goods of the victimized appropriator-producer~exchanger, thereby raising his effective time-preference rate (his time preference schedule being given). On the other hand, insofar as individuals perceive a risk of future victimization they will accordingly reallocate their resources. They will build walls and fences, install locks and alarm systems, design or buy weapons, and purchase protection and insurance services. The existence of crime thus implies a setback in the process toward a fall in the rate of time preference as far its actual victims are concerned, and it leads to expenditures-by actual and potential victims-which would be considered wasteful without the existence of crime.
            Therefore, crime or a change in its rate has the same type of effect on time preference as the occurrence or a changed frequency of "natural" disasters.

Regarding legitimized violence, he says

Because of their legitimacy, … government violations of property rights affect individual time preferences systematically differently and much more profoundly than does crime. Like crime, government interference with private-property rights reduces someone's supply of present goods and thus raises his effective time-preference rate. Yet government offenses-unlike crime-simultaneously raise the time-preference degree of actual and potential victims because they also imply a reduction in the supply of future goods (a reduced rate of return on investment).

To enter a full discussion of where Hoppe and Pinker disagree would take a long while, let alone where I may disagree with both authors. I should say that I think increased wealth may directly contribute to reducing crime, both for reasons described by Hoppe (investing in defensive goods and services) and for reasons of providing better incentives to use “economic means” to acquire additional wealth. Regardless, it is important to understand the internalization of nonviolent behavior, how it contributes to the extent and intensity of social cooperation, and how it ultimately contributes to better social outcomes. On that note, one may wish to read further - see especially the paper by Stringham on economic freedom and homicide.

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