When I was a graduate student at the University of Chicago, my girlfriend and I used to walk home at night past a jewelry story that had a little note pinned in the window: “all our jewelry made by elves as we sleep.” The store was dark but at the very back was a little lamp burning.

If you stared long and hard enough, as my girl friend and I sometimes did, you could begin to see the elves at work. I remember saying to Jane, “is this not the very best way to sell jewelry?” to which her silent reply was, I believe, “so buy me some.” This was my introduction (post childhood) to the power of mystery as sales technique.

Yesterday, I noted how Minus 8 vinegar creates scarcity. Today, I want to show how it creates mystery.

Minus 8 vinegar is made by a couple who work hard to protect their anonymity. (The CBC is waiting to see if they are willing to participate in the story.) Not quite elves creating jewelry but something close.

This anonymity, and the obscure and secret details of Minus 8 production, help create a sense of specialness about the brand. Consumers want it more, not less, because it is so produced.

This marks a movement away from the traditional bargain created by capitalism. Boomer readers will remember those charming (and endless) documentaries that showed footage of the production line. Companies staged factory visits. “Look,” was the message, “nothing to hide! We want you to see where the product come from and the pains we take to make production immaculate.”

Now, we say, “how dreary.” We want things from sources secret and mysterious. Jewelry and even vinegar.

The deeper trend is clear. We are no longer enamored of our once vaunted rationalism and its promise that darkness, confusion, uncertainty would be burned away by the clear light of reason. We declared war, in fact, on mystery. Mystery was the locus of mischief, confusion or evil.

With reason installed (relatively speaking) as the great feature of a modernist society, we began to pine for the old days. Those superstitions and fairy tales, now scorned, were remembered and revived. New age practices became popular. (I still remember a relatively intelligent woman from the Midwest telling me that my balding pattern was proof of my descent from the Pharaohs.) In sum, we made the world a kinder, gentler place by readmitting mystery and magic and folk beliefs. (As I say in Transformation, no one ever seems to discover that they are the reincarnates of a stupid, cruel, tubercular char women living with 5 kids in the grinding poverty of an 18th century slum. Better to think of ourselves as Pharaohs.)

Capitalism will respond to this as it responds to the scarcity challenge. This is a cultural meaning it can and will invest in our consumer goods. It will be a challenge of course. Most marketers do not rely on elves to help out around the office. But if consumers want a “reenchantment of the world,” that’s exactly what they’ll get.

References

There is an early post that is germane here. If you’re interested, have a look for the one called “Tag, we’re it.”

I got an email from a CBC journalist, Jeff Buttle, asking me to comment on Minus 8 Vinegar. According to Wine Spectator, Minus 8 is a big deal in the culinary world.

What started out as a hobby for two Ontario foodies has become an ingredient much coveted, and consequently, guarded by some of the nation’s preeminent chefs.

Everything about Minus 8 is clandestine. The vinegar is produced in Ontario’s Niagara region (the exact location is a secret) by a couple who wish to remain anonymous (we’ll call them “Rick” and “Karen”).

Jeff asked me to comment on this trend. My reply:

I like the way Minus 8 vinegar creates scarcity. In a market place with national brands and perfect distribution, there is almost nothing we can’t get. (You remember the days when people were flying cases of Coors out of Colorado because it didn’t exist in the rest of the US.) But scarcity creates intrigue, interest, conversation, bargaining, in sum, a kind of specialness.

In sum, the market doesn’t do scarcity and mystery very much these days but we wish they would. And then along comes a little wine vinegar by “Rick” and “Karen.”

The rise of the national brand has created several kinds of value but, in the process, it destroyed another. It destroyed the particular savoring that came from knowing that this case of beer (or bar of soap or bag of bagels) was spirited across the country, that we were the only locals now to have it, and that when it was gone, it was gone for good. It’s the difference between the small, exquisitely chosen dish and the all-you-can-eat banquet. In one case we treasure, in the other we just eat. (At least, I do. You are probably more like the great food critic of our community, Tyler Cowen.)

I especially like the social effects of this scarcity. People pleaded with a friend going to Colorado, “bring me back a case, please. Listen, I’ll get you tickets to the Mets game!” And now the recipient had a precious resource and a fungible one. With whom was he going to share his precious beer? Which friendship ties would be cemented, which opened up, and which closed down?

Wait a second. Precious beer? This scarcity makes it so. And it encourages acts of exchange that set in motion several kinds of currency (e.g., Met tickets) in the creation and destruction of several kinds of relationship (“Bob’s a fat bastard. He didn’t even give me one of his Coors.”)

Do robust, well integrated, economies tend to eliminate local variation? I am guessing they do. This is strange because our capitalism has specialized in making consumer goods mean more, and more interesting, things. But in this case, the local meaning is taken out. It no longer matters where goods come from. Place of manufacture no longer counts. (I am generalizing here. It is impossible to think about Starbucks, Ikea, or Prada without place creeping in.)

National brands will someday solve this problem. Not because they care about consumers carting things across the country. They will do it to respond to the splintering of consumer taste and the differentiation of consumers themselves. They will begin to build variations into the brand message. Our local Starbucks will have several design signatures: national, regional, city and neighborhood. This is one of the ways Starbucks, for instance, will add value for the consumer and make itself part of the “Experience economy.”

This is also a way to generate buzz marketing. (Buzz is all the buzz in marketing these days. The issue: how to use word of mouth to create demand.) Consumers will engage on this one. Imagine the conversation between two owners of slightly different models of the same Prada hand bag. “So you got yours in Frankfurt? Mine’s from Milan.”

But note in all the ink spilled on buzz marketing, nobody, as far as I know, has thought to recommend variation as the answer here. No, that was the creation of two foodies in Canada. The market to the rescue once more. Thank you “Rick” and “Karen.”

Ok, I have run out of space and time. Tomorrow, I will have a go at the “mystery” aspect of Minus 8.

References

Cowen, Tyler. 1998. In Praise of Commercial Culture. Cambridge: Harvard University Press.

Cowen, Tyler. 2002. Creative Destruction: How Globalization Is Changing the World’s Cultures. Princeton: Princeton University Press.

Fauchald, Nick. 2004. Made Like Ice Wine. Wine Spectator. January 31, 2004.

Pine, Joseph, and James H. Gilmore. 1999. The Experience Economy: Work is theatre and every business is a stage. Boston: Harvard Business School Press.

I owe the Prada image to a discussion with Pamela DeCesare of BrandMuse Inc. at the Design Management Institute meetings in Vancouver this spring.

Daniel Rosenblatt offered this comment on the "sapphire ring and the cunning of James I”" post (yesterday):

The briefest of comments on the story about James I (there is much in recent posts I want to comment on at more length, but haven’’t had the time): To me the story points to the fact that markets and incentives are human inventions, tools which can serve certain purposes.  Refining their design can help them serve those purposes better, or make them serve new purposes.  They can’’t necessarily serve all purposes, nor are they necessarily the only or best way to serve some purposes.  As an anthropologist, my objection to much economic theory is not that it is interested in how markets work but in that it imagines the product of our collective agency as instead part of the natural world–imagines that there can be a difference between "intervention" and "leaving things alone."

Daniel evokes a sentiment that has currency in the field of anthropology and the ideological community from which most anthropologists come.  (I hope Daniel will forgive me as I now impute to him positions he may or may not hold.  I am now generalizing shamelessly.)  This sentiment says, in effect, that we make too much of markets and incentives.  These are after all merely "human inventions,"” and ‘tools for certain purposes."”  Economic presuppositions should not serve "all purposes” and they should not be privileged as the only or the best tools at our disposal."  From this point of view, economic assumptions and activities have usurped their place.  They belong to one part of the social world, and they are now increasingly being made the stuff of, and the surrogate for, our "collective agency."”  There is still a place for intervention.  We may not, we must not, leave things alone.

But let’’s rehearse some of the things we know about First World cultures. 

1) these societies are highly individuated.  The individual is broken out of the family, kinship group, community, ethnicity, religion that once defined him.  This individual is free to choose and forced to choose who he is and with whom he stands. 

Further to the discussion with Deighton (last post), this means, among other things, that the individual is no longer born into but must create or enter various forms of association.  It also means that the bonds of association will have less to do with trust, and more to do with incentive.  Incentive is the only "friend"” a fully individuated creature can rely on.  All other bets are off. 

At the limit, this is the "society of strangers"” miracle that Sahlins and others talk about. In traditional society, trust is "decided" by ties of kinship, community, and religion.  I know who you are and what I can expect of you because I can identity the group and the role that define you.  In a society of strangers, where individuals are individuated, this is no longer true.  I can’’t know what to expect of you.  Our relationship works (and work it must because there are no other architectures for exchange), only when I can read what incents you.  Only then may I trust you.  (This is the point of the original James I post.  The monarch finds himself in a predicament where trust is not enough to protect him.  He finds an incentive system that will.)

Something in the community of anthropologists (and other academics) recoils at this.  They yearn for a kinder, gentler world, a small town, a neighborhood bar, in which "everyone knows your name.”"  Here everyone has preexisting roles and with them come nice, clear specification of what everyone owes to, and may expect from, everyone else.  Incentive has nothing to do with it.  Trust is it. 

The problem here, I think, is that these communities demand a price our individualism is not prepared to pay.  These communities almost always presume to say who we are and how we must behave, not just in transactions, but in our claims to personhood, in the way we define ourselves.  The ugly side of the small town, where everyone knows not just our name but our business, is that it presumes through gossip and relative inclusion to police our choices.  When anthropologists yearn for the kinder, gentler community, they are always thinking, it seems to me, of a place that knows our name, but not our business, a place where we have the liberties of anonymity some of the time, and the comforts of pre-existing association when it suits us.  They want, in short, to have their cake and eat it too.  (And when forced to choose between anonymity and presumption, they usually choose the former.  This was not true in the 60s commune or the present day cult, where people appear to trade away the liberties of self definition for the comforts of a more traditional association.  And what a bad trade-off this turns out to be.)

2) Western, First world societies are broken away from cultural continuities and shared definitions.  Things change.  We are unmoored.  There is almost no domain in which change is not constantly "on the boil.”  Religion, politics, family, community, entertainment, communication, all of these rewrite themselves and unmoor us. 

Where does order come from in such a world?  The Hayekian economist has no problem here.  Order emerges from the aggregate effects of individual choices.  Family is what families do.  People will make their own choices, and in the process, new cultural forms will rise up (e.g., blended, same sex, single parent, two residence, no kids, or 2 pet families).  Now we may decide which of these forms suit us, or whether we must engage in innovations of our own.

Anthropologists, on the other hand, are stunned by this.  Emergent cultural forms are not like anything we have ever seen before.  In our world, cultural forms come from ‘time out of mind” convention.  They are passed down to the individual by tradition.  We are, I would submit, quite unprepared to think about such a world.  And the solution for many anthropologists has been resounding: let’s not think about it.  Let’s insist that this is a corruption and an inauthenticity we need not think about.  Let’s shut it out from the realm of discourse.  What we cannot shut out, we will shout down.  We will devote some of our anthropology to the recitation of the things that should be true of the world, and we will make the market place and economists the villain of the piece.

"But what about the cultural commons?” comes the cry of protest.  Why shouldn’t culture be more like language, a shared resource no commercial interest can commandeer?  I believe that a commercial culture is indeed a lot like language.  It is, at least, a lot like English.  English as a language is famously responsive to what people want to say.  We may contrast it to French which is, as a language, a good deal more particular.  When the anthropologists call for a "cultural commons” they seem to me to be thinking about something that would have to be policed by an Academie Francaise.  (And we all know how well that’s turned out.)   

The sticking point is the suspicion that cultural innovation that is "birthed” by the market place must be the slave of special interest.  Culture ruled by commerce must be the captive of the corporation.  And that’s bad, no?  No.  I have some ethnographic data here.  I work for corporations and I watch them struggle to keep up with the innovation taking place "out there.”  If they are controlling or successfully manipulated this innovation, it is very hard for me to see.  The image of the controlling corporation that bends culture to its will is a fantasy that can only be cultivated by academics who take the precaution of never leaving their studies, preferring instead the "intelligence” fed to them by the likes of Michael Moore.  Dudes, you have to get out more. 

The question here, I think is that anthropologists have to start again.  We need to take on the challenge of thinking about a culture that comes out of individual choices, made in markets, constrained not so much by trust as by interest, by highly individuated, highly innovative individuals who will no longer defer to what they must do, or to what anthropologists think they should do, but who engage in all that getting  and spending in a society of strangers that somehow, miraculously, works.  This is the miracle of "emergent order” and it seems to me that we have to turn to the people, especially the economists and complexity theorists, who are good at thinking about it.  Our reward?  Making the miraculous a little more intelligible. 

And that is the point of this blog.  It will be clear to the economics reader of the blog that I have at any given moment only a rough idea of what I am doing.  To use a too dramatic metaphor, I feel like someone who has escaped one of those prisons in the deep American south.  You know the Hollywood stereotype.  No sooner have you gone over the wall than you find yourself lost in a thicket of brambles in a boot sucking swamp.  The gators are waiting.  The dogs are coming.  Light is fading.  You have lost your bearings and your way.  No, it would be wrong to say that I am entirely comfortable, but even this is better than the prison cell of anthropology.  (Hey, I told you it was too dramatic.)

With thanks and apologies to Daniel Rosenblatt.  Clearly, I have attributed to him things he did not say and does not think.  This is the thanks he gets for contributing!  Sorry, sorry, sorry.

John Deighton, Daniel Rosenblatt, and Patrick Warren all made great comments on yesterday’s post and ideas began to flourish like an Elizabethan garden. Could I ask the reader who has not read yesterday’s post to take a look at it? I know you are smart enough to “reverse engineer”” that post from these comments. (It is what I would try to do.) But these comments are so good, they move as swiftly as Smartie Jones away from the original. You might just as well start at the beginning. So, please, page down and come back. John Deighton: The posting got me thinking about a conversation I had on a bus a couple of weeks ago. My thought went, ‘This speaks exactly to the impossibility of trust, and the need for structures of incentive. What was it the man on the bus said – trust should be banned from discourse except when talking of relations not continuously in negotiation?’ There are some relations – say the relation between a professor and his/her university, or between a board member and a corporation, or between a son and father (your posting about Father’s Day is very apt here) that admit of no give and take regarding the obligations of the role. The relation is categorical. There is a hard, bright line between performance of the duties demanded of the role and failure to perform – no room for rewriting a contract as new circumstances arise. Fiduciary and sovereign/subject relations are of this kind. You can’t say I’ll be your auditor and if I catch you cheating I’ll turn you in, and then make an exception when the auditee offers a bribe or a hard luck story. Everyone has to be able to trust an auditor not to do the decent thing or the self-interested thing, but to do the thing the role specifies and nothing else. The auditor/auditee relation is categorical. It is said that professors get tenure to remove their fiduciary relation toward the university’s best interests from taint of self-interest. A professor without tenure cannot be trusted to hire someone smarter than him- or herself. It seems to me, though, that in a world that cannot rely on universal belief in an all-seeing God with hell up his sleeve, there are no fiduciary or sovereign/subject relations, and hence no use for the work of the word trust. Grant’s reply to John: Nice one. I think the, or at least one, reason that we can trust a person defined by role has nothing to do with us, not our trust, not their incentive. It is precisely that the person is defined by role, so defined in fact, and so keen to be so defined in fact, that they cannot misbehave without sacrificing their claim to the, variously, majesty, honor, sanctity, verisimilitude, veracity of their role. What keeps them honest is their existential need to remain who they are, to keep the meanings they have. Our job, if we wish to make sure they will not misbehave, is to give them so much majesty, honor, sanctity, and acknowledgment, that they have at the end of the day, more to lose than gain from misbehavior. Or to put this in Shakespearean terms, a monarch might chose to break the faith but he/she would pay dearly for the benefit. Or to put this in anthropological language, their claim to identity, to a desired cultural definition of the self, demands the performed fulfillment of their identity. There is a “violation” clause. You can’t be king if you don’t act like one. And this is not because we will remove your role definition, but because you will. (One thinks here of Nixon, Johnson, and Clinton leaving office in disgrace.) This is perhaps why Elizabethans worked so hard to honor their monarchs. It wasn’t slavish deference. It was the need to press home the definition that would summon the right behavior. In effect, they were saying, “This is who you are. You know what to do.” The cultural meanings that define who you are the cultural meanings that protect us…because frankly we don’t trust you, and we can’t incent you. This adds a third term to the economics dyad, I think. There’s trust, there’s incentive and then there’s definition (or meaning). And we can break these out perhaps like this: trust is sociological, incentive is economic, and definition is cultural (that is, anthropological). John’’s reply: Your point about definition is very good, particularly the purpose of flattery and honor. I would not raise it as a third term though unless you can convince me that it isn’t a form of incentive. If the rewards of adhering to the role exceed the rewards from cheating, I stay in the role. I think the thing about fiduciary and sovereign roles is that they allow malfeasance with little risk of being caught. Are you saying that honoring a monarch inculcates a self-concept in the monarch that is endogenously rewarding, a sense of who I am that is so pleasing to me that I owe it to myself (me, not the flatterers) to live up to it? One of those “I couldn’t live with myself if I…” inhibitors? A transaction within myself, not between me and the courtiers? Quite interesting. If that’s your story, though, it seems to require a divided self, one that is venal (enjoys flattery) and one that isn’t. I think you like divided selves, or perhaps it is situationally engendered selves, while I regard them as vulnerable to infinite regress. If there is a venal me kept in check by a moral me, why not a tempter me to egg on the venal me and a hangman me to regulate the tempter and an absent-minded me who forgets he’s being watched and so on? That’s the great wonder of economics – so parsimonious yet explains so much. That said it should be noted that the self-interested hermit-like economic actor is under attack in economics. Particularly in finance, it is being discovered that if the actor is endowed with cognitive limitations, like limited foresight, confirmatory bias and poor memory, more can be explained. But every refinement that is made to Adam Smith’s simple homunculus of self interest seems a step away from parsimony and another crack in the foundation of the imperial social science. Grant’s reply: Thanks. First, it is true that the person who is defined as a monarch (or president) and treasures this definition of himself does have an incentive to continue in this role. But this incentive comes from the symbolic economy of kingship (or the office of the president) not the exchange of the marketplace. We give him honor, he gives us good behavior. But neither party has a alternative supplier. The value of the value exchanged is not set by the wee contracts by created constantly in the market place. The relationship comes from cultural convention with very strict “felicity” rules, as Austin would say. Or to put this another way, we are incenting the monarch, but we cannot choose the value he gives us in return. In sum, there is something like incentive at work here, but it doesn’t look very much like the “incentive” we speak of in the marketplace. I think “definition” (or culture or meaning) might well survive as a distinct third term. Second, we are creating an “I couldn’t live with myself” condition. And this works because misbehavior actually means “I wouldn’t live with myself.” I would no longer be a monarch in my own eyes. Clearly, monarchs or politicians do misbehave. The definition supplied by kingship or the presidency is sometimes obscured by the temptations of a break-in or an intern. But I don’t believe this temptation presents itself as a calculation of relative advantage. It’s a temptation, a momentary failure of calculation that occurs as a result of the siren call of an intern (and the rash assumption that no one will ever find out). I have edged into your third point: the need to posit several selves. I don’t think I am, for once, obliged to do this. All I need to do is posit temptation. I realize I am resorting to the psychological model supplied by my upbringing in the Protestant church of Canada. But I think it’s apt. Clinton’s famous dalliance did not come from a calculation of benefit vs. risk. It didn’t come for a dialogue between “moral mes” and ‘tempter mes”. It came as a sudden “shorting out” of judgment. There is no second self here. There is just brute temptation. And this is, though I hate to say it, where the “civility” argument comes in. In a civil society, everyone is much more aware of the responsibilities attached to their role, and perhaps more prizing of the definitions that come to them as a result. They know the right thing to do and they believe more completely in the right thing to do. It helps define them. It is just possible that we created Clinton’s moment by so often scorning the office and diminishing the “definitional” benefit he got therefore. Why not act in a non presidential manner if the collectivity is inclined to doubt the role from which I draw my meanings? And before you say that I have opened up a can of worms and must now account for all the meanings supplied by civility and by culture, don’t forget this is what anthropologists do. Late note: I will leave till tomorrow responses to excellent comments by Daniel and Patrick.

Let’s say you are a 17th century monarch in waiting.  You live in Scotland and you await the death of the monarch to the south, Elizabeth I.  On her death, you will be raised to the English throne.  You are, in fact, James VI of Scotland, soon to be James I of England.

You have a deep interest in the earliest possible notice of the death of Elizabeth.  The moment between monarchs is a perilous time.  Even with the best claim in the world, you can be supplanted by nimble, powerful counter-claimants.  Plus, you are sitting in Edinburgh well removed from the seat of English power.  You want to be quick about it. 

You also have a deep interest in receiving certain knowledge of Elizabeth’s death.  Elizabeth’’s health has been failing for some years now.  Someone might hear a rumor of a sudden decline, and race north to give you the "news" on the assumption that death was coming, when it was not.

Your problem is simple.  If you are too late in mobilizing to claim the throne, your chances of gaining it are put at risk.  If you are too early…well, if you are too early, God help you.  You will begin your march to the south, not as Elizabeth’’s successor, but as a rebel or a clown.  Elizabeth doesn’’t forgive people even minor slights to her majesty.  How do you think she is going to feel about the premature celebration of her death?

So what do you do?  How do you manage this risk, multiplied by this uncertainty?

Here’’s what James did. 

The first man to make it to Edinburgh with the news of Elizabeth’s death was Sir Robert Carey.  Some weeks before, he had arranged for a string of horses to be prepared for him at inns along the Great North Road.  He rode continuously, for 70 hours.  En route, he fell from his horse and was kicked in the face.  Bleeding, swollen, and exhausted, he arrived at the palace of Holyroodhouse, and seized the honor of being the first to honor the new monarch of England, Scotland, France and Ireland. 

James asked what letters Carey had brought with him from the English Council.  Carey had none.  This was a private initiative.  He had been living beyond his means for years, and he was desperate for the advancement that would surely come to the bearer of this news. 

But Carey did have something that would serve as proof.  He presented a sapphire ring which James had once sent to Carey’s sister, Philadelphia, Lady Scroope, with the express purpose that she would return it as soon as she knew that Elizabeth had died.  With this ring, James England wed. 

Clever James.  He had created a signal that would serve both his ends: earliest notice tempered by greatest certainty.  The sapphire ring was a cunning thing.  It was a kind of economic bargain with the future, one guaranteed to release its value only if and when certain conditions were satisfied, only as and when certain incentives were set in motion. 

The bargain:

1)  James began be creating (or surrendering) something of relatively exceptional value: the sapphire ring.  The ring could not be duplicated without difficulty or expense.  No counterfeit ring would be likely to deceive him.  (This is the Elizabethan age, after all.  A counter claimant might well conspire to embarrass James through counterfeit.)

2) James placed this ring with someone sufficiently well placed to be an early recipient of news of Elizabeth’’s death.

3)  The ring had three kinds of value.  It was valuable in itself.  As a token from someone in power, it was still more valuable.  But as a signal of James’ accession to the throne of England, it was most valuable. 

4) Lady Scroope was "incented” to keep the ring for values 1 and 2.  Her brother, Robert, might want to start the ride early.  But Lady Scroope would be reluctant to gamble something so valuable on his desperate whim. 

5) But on certain news of the death of Elizabeth, Lady Scroope was now incented to release the ring as soon as possible and to see to its delivery to the future king of England.  For all we know, it was she who paid for those horses on the Great North Road, and she who said to Robert, translating now for modern ears, "get your butt up there.”"   

6) In sum, James’’ bargain meant he did not have to trust Lady Scroope, her motives, or her judgment.  Her pursuit of advantage would protect his pursuit of advantage.  The ring contained two values.  One kept the ring in place.  One set it in motion.  The value to him was the value to her was the value to him. 

This is one of those little "anthropology meets economics” puzzles.  No, I don’t know what to do with it.  But perhaps you do.  Hey, you’’re James I. 

Reference:

Historical details from:

Nicolson, Adam.  2003.  God’s Secretaries: The making of the King James Bible.  New York: Perennial, pp. 4-5. 

With a tip of the hat to John Deighton for helping me think about how trust and incentive works in the marketplace, even a royal one.

Last time, I tried to show the larger implications of our fondness for Monk. This time, I want to take the argument one step further, this time right into the teeth of economic assumptions. (This is no idle metaphor. I have no illusions about the limits of my knowledge when I tread on the patch of another discipline especially one so productive of illumination as the field of economics.)

The argument so far:

1) popular culture shows a new sympathy for those afflicted with psychiatric symptoms (i.e., Monk),

2) we are inclined to suppose that a range of psychiatric conditions somehow apply to ordinary individuals,

3) this is, I think, a symptom in itself. It seems to me we are now rather frantically casting about for ways to characterize reformations and deformations of the self as these are occasioned by a newly dynamic world,

4) we would do better to start again, cast off the DSM paradigm, and look for a new model that does a better job of capturing how and why the self is changing (and just say “no” to the pathologizing),

5) complexity theory offers us one new model for the self. It says that any creature is more adaptive to a dynamic environment when it allows a new complexity, multiplicity, messiness, and changeability. The new symptoms of the self are, in this view, adaptive responses to the world. Indeed, they are the very structural characteristics we would expect the self to assume as it learns to live with a highly various, changeable and unpredictable environment. In order to live in his world, we are taking on the characteristics of the world.

6) one of the characteristics of the human CAS is, I think, the ability to entertain simultaneously a number of “preference registers” and the ability to skip back and forth between them. (I used as my example here a friend of mine who has three bosses, one coming, one going and one competing, and she must entertain all of their different points of view, when she is on the job and know when to evoke one and suppress the others, or how to finesse all three.)

I see now that this has some interesting implications for economics. Thanks to Prestopundit, I read a post by Donald Boudreaux. Donald makes the following point about ‘transitive preferences.”

Preferences are transitive when the following is true: If John prefers apples to bananas, and if he also prefers bananas to cantaloupe, then John prefers apples to cantaloupe. Despite the hoity-toity jargon, the concept is straightforward. It’s also an assumption that clearly applies to everyone.

Here’s the problem. If the newly complex consumer is entertaining multiple registers of taste and preference, it is possible that s/he will prefer, to use Don’s example, apples at one moment and cantaloupe the next. Or to use a more concrete example, let’s take Brooks’ interesting book Bobos in paradise. Brooks suggests that baby boomers are cultivating a very particular duality of self definition. Sometimes they see themselves as bourgeois. Sometimes they see themselves as bohemian. In the first instance, one set of preferences applies. In the second, a very different one does. Still more concretely: sometimes we eat out at the most sophisticated and expensive Italian restaurant, sometimes we prefer a humble coffee shop.

This is another way of saying that not only is there a variety of taste and preference across consumers, there is a variety within any given consumer. This variety doesn’t only come from the lifestyle hybridization of the kind that Brooks identifies. It can come from the archeological accumulation of preferences that build up in each of us. We have our present tastes and preferences, but because we are moving through an ever more rapid change in these tastes and preferences, it is not unheard of for us to return to recent patterns…for a moment. We could call this nostalgia, but this is a term that is now so outdated it has a certain nostalgia of its own. It posits one set of former tastes and preferences that we return to occasionally. The archaeological model says, no, actually we end up slipping back and forth between recent patterns without a passage “down memory lane.” We are not so much “going back in time” as we are skipping about in our near history. The concrete example: until I hit the cooler at my local grocery store, I am not certain whether I will reach for Becks, a long time favorite, Keiths, a new enthusiasm, or Molson’s, a favorite of the middle term.

I don’t know what to do with this. And of course I understand that it is, as my father would have said, a “mug’s game” to point out inconsistencies in the economic paradigm. In point of fact, this paradigm remains so robust as to put the rest of the social sciences to shame. (It never ceases to amaze me when my McGill students, who are anti-economic to a man and a woman, will happily and with no sense of contradiction engage in economic man behavior.)

But I think this might be a “muddle in the muddle” as the late University of Chicago anthropologist David Schneider used to say. And if I am right to think that as the world becomes more various, as choice becomes more multiple and as the consumer cultivates or endures more and more taste and preference registers within, we are looking at a problem that will not go away.

Notice that I am not saying that the consumer has ceased to be rational. Merely that he or she has several rationalities going on at any given moment. Somehow we have to take account of the many compartments of taste and preference within the consumer.

References

Boudreaux, Donald. 2004. Sound Assumptions. Tech Central Station.
http://www.techcentralstation.com/062104A.html

In his comment on yesterday’s post, Patrick helped me clarify what I was trying to get in the last few posts. Here’s my reply to him:

Patrick, I guess I wanted to get at two things: a change in the self and a change in the world. I think this is the place that anthropology and economics do not play well together.

Change in the self:

Here’s how Geertz defines our notion of the self.

The Western conception of the person as a bounded, unique, more or less integrated motivational and cognitive universe, a dynamic center of awareness, emotion, judgment, and action organized into a distinctive whole and set contrastively both against other such wholes and against its social and natural background, is, however incorrigible it may seem to us, a rather peculiar idea within the context of the world’s cultures. (emphasis added)

Now I understand that most of this is “surplus to requirement” from an economics point of view. For the economist, it is enough to posit a rational actor using scarce resources in the pursuit of costly choices. But, for anthropological purposes, it’s important to see how the culture(s) in question define who and what the person is.

In our culture(s), there is an inclination to posit the person as something bounded and integrated, with a center, as a whole. We presume that the person is well organized within and well bounded without.

Change in the world:

This “person” now lives in a world of great variety and dynamism. The world changes often and unpredictably. Our basic notions of family, work, politics, entertainment and engagement are under constant reconstruction. It used to be that our grandparents could not imagine the world in which we live. Now it is the person we were 20 years ago who would find this challenging. (This is a nice anthropological experiment: imagine the things you would have to tell the person you were 20 years ago to explain where and what you are now. Usually, this is a long and relatively difficult conversation in which our younger self ends up sounding like Kevin Klein from A Fish Called Wanda a lot of the time: “What’s the middle part, again?”.)

To live in such a world is a problem. It demands of us a new capacity to see what has changed, to think about what has changed, and to respond what has changed. One thing is clear. If we use the old Western concept of person, the one specified by Geertz, we turn the problem into a crisis. If what we try to do is keep the self bounded, integrated, centered and whole, we are sure to make a hash of things. Adaptive advantage goes to people who are newly porous and multiple and messy.

The monk in nous

Most of us are still trying to deal with a newly dynamic world with the old model of the self. And it’s this, I think, that has occasioned this rash of diagnostic enthusiasm in which we attribute DSM symptoms to normal people. Time to give up the old paradigms and start again. What I like about CAS theory is that it appears to take for granted the very things the old notion of the self finds problematic: multipleness, messiness, vigilance, and the capacity for threshold change. From the old DSM point of view, these do look like symptoms. From the CAS point of view, they are ordinary adaptive responses.

Back to economics. The irony here is that economics, or at least the operation of a world predicated on an invisible hand model, is what makes the world so dynamic. When Hakek talks about a world that emerges for the actor from “a process more complex and extended than he [the actor] could comprehend,” he was talking about the world we know. All those actors, with all those intentions, fashion a world that is constantly “on the boil.” And in this world, the economic actor must change. Not least, he must learn to skip from one set of assumptions to another with extraordinary CAS agility. (I was recently talking to a woman who says that at the moment she must answer to three bosses: one coming, one going, one competing for the job. She must judge everything she does from 3 completely different sets of assumption. Yes, I thought to myself, you are learning how to be a CAS.)

This is another way of saying economics is very good at assuming (and creating) the dynamism of the world. It is not clear to me that it is so good at assuming and explaining the dynamism that now exists in the actor.

So this is my challenge to the economics reader. What, if anything, happens to the economics point of view when we posit an economic actor who is a CAS, messy, multiple, dynamic and inclined to sudden threshold changes? Or better, what can anthropology, through a better understanding of the new economic actor, bring to the party?

References

Geertz, Clifford. 1974-1984. “From the native’s point of view” On the Nature of Anthropological Understanding. Culture theory: essays on mind, self, and emotion. editors Robert Alan LeVine, and Richard A Shweder, 123-36. New York: Cambridge University Press.

Hayek, Friedrich A. 1948. Individualism and Economic Order. Chicago: University of Chicago Press, pp. 13-14.

There are 65 million dogs in the US and 77 million cats. 

Seventy-six million households own a pet (roughly 3 in 4). 

We will spend $34 billion on pets in 2004 (up from $17 billion in 1994): $1.6 b. on the pets themselves, $14 b. for food, and $8 b. for veterinarian care.

There are some interesting patterns in these numbers:

There are slightly more male dogs than female dogs and slightly more female cats than male cats.  This suggests that we honor the cultural notion that dogs are "male"” and cats as "female.”"  What happens to the animals that do not fit this gender profiling?  You don’t want to know. 

Some owners of Vietnamese Pot-bellied pigs found their new pets too aggressive, and they did something surprising.  They took them to a slaughter house.  Then they did something really surprising.

In some cases, the owners took the meat from their pigs home, which certainly goes against our traditional thinking about what we do with our pets.”

Indeed, pets are animals of a special kind.  They have special rights and privileges.  Generally speaking, we don’’t slaughter them, and, specifically speaking, we don’’t eat them. 

Why not?  Animals are animals, and protein is protein, right? 

Hah, pets are not animals.  Let’’s be clear on that. Fifteen percent of Americans travel with their pets each year, apparently.  Why?  "More and more people consider their pets as members of the family.”"

Surely this is just a metaphor.  We don’’t really suppose that this animal, obtained from a pound, incapable of speech, inclined to acts of stupidity, is really somehow "related”" to us, do we? Well, yes, actually, we do:

According to a American Animal Hospital Association survey (1997), more than 60 percent of cat and dog owners include news about their pets in their holiday greetings, 27 percent take their pets along for family photographs and pictures with Santa, and 79 percent give their pets holiday or birthday presents.

We give them presents?  Birthday presents?  To an animal that does not know what day it is, and has a tough time the wrapping paper?

I have a suggestion: we are conferring something like personhood on our pets.  We are turning these animals into social creatures with special rights and privileges.  They have the right, most of them, to live in doors, to eat better than many people in the third world, to receive excellent health care, and we promise not to eat them when they die.  (There is a flourishing trade in pet cemeteries, and surely this is a good measure of their extra-animal status.  We see them off to a better place.)   

Those who fail these conditions are seen to be not merely callous.  They are seen to be morally culpable.  We are inclined to say things like, "There is something really wrong with those people.  They left their dog out all night.  Again!”"  This is a moral judgment of what we take to be a moral failing.  Why?  Because pets aren’’t animals.  They are something more.

But these are just the minor conditions of personhood.  We go a lot further.  We believe pets have special tastes and preferences, we agonize over their cuisine, we wonder if they are feeling a little "off”" today, and whether they want the blue or the red lined basket.  In the new regime, animals have a cultivated palate, a rich emotional life, and aesthetic preferences. 

There is still more.  Apparently, "89 percent of pet owners believe that their pet understands all or some of what they say."”  In this case, we are conferring a higher sentience upon them.  We are supposing that they are capable of speech.  We believe that we are talking to them and that they are talking to us. 

In a famous passage, Clifford Geertz had this to say about personhood:

The Western conception of the person as a bounded, unique, more or less integrated motivational and cognitive universe, a dynamic center of awareness, emotion, judgment, and action organized into a distinctive whole and set contrastively both against other such wholes and against its social and natural background, is, however incorrigible it may seem to us, a rather peculiar idea within the context of the world’s cultures.

We have taken our peculiar idea of the person and conferred it on our pets.  This is an exceedingly odd and interesting transformational exercise.  After all, these animals are, by human standards, deeply stupid.  When we treat them as persons, we engage in an astonishing act of metamorphosis.  But implausibility does not discourage us.  We are a nation of individuals and we have decided that our pets are going to be individuals, too.

References

Geertz, Clifford. 1974-1984. "From the native’s point of view" On the Nature of Anthropological Understanding.  Culture theory: essays on mind, self, and emotion. editors Robert Alan LeVine, and Richard A Shweder, 123-36.  New York: Cambridge University Press, p. 126.

Sahlins, Marshall. 1976.  Culture and Practical Reason.  Chicago: University of Chicago Press.

Data on pets:

http://articles.findarticles.com/p/articles/mi_m4021/is_2000_August/ai_65300663

http://www.avma.org/membshp/marketstats/sourcebook.asp

http://exoticpets.about.com/gi/dynamic/offsite.htm?zi=1/XJ&sdn=exoticpets&zu=http%3A%2F%2Fwww.appma.org%2F

http://www.hsus.org/ace/11831

http://researchnews.osu.edu/archive/potpigs.htm

Yes, it’s come to that. I am reduced to posting pictures of attractive women. But, no, actually, there is a story here.

This summer, women are covering up. The NYT says they are “exposing less skin [and] ditching the micro-minis, cropped tops and thong-baring jeans of previous summers.”

We must take this news bravely. The work of anthropology and economics will have to carry on. In this post, I want to use the two fields together to think about this new trend. (I am counting on help from my economics readers.)

An economics explanation suggests itself:

When women begin to wear less, they start a competition for male attention. In this matter, men are not the most subtle creatures. Advantage goes to women wearing less. What is attention-getting at T+0 (time right now) is merely ordinary at T+1. So women wear still less…and so it goes. Eventually, women are looking ‘trashy,” in the words of Jane Rinzler Buckingham of Youth Intelligence. At this moment, the competition is, in a sense, “maxed out.” There is no competitive place to go.

There is presumably a “stall” moment. Women know they have a problem, but they do not have a solution.

Then there is a “reset” moment. Women move back to modesty. In a sense, they have to do this merely to start the game again. But what about those outliers, women who continue to wear less and reap the benefits of doing so? “More clothing” women now suffer a competitive disadvantage.

An anthropology-economics suggests itself:

In order for women to move back to “more,” the community of women (and the marketplace) must respond more or less collectively but without the benefit of explicit decision making or communication. They must move together and at roughly the same moment. How does a consensus like this emerge without the benefit of a presidential commission? This is a problem for complexity theory, the place that economics and anthropology meet, in my opinion. How and when women undertook this latest “emergent” move would make a great case study. (Selflessly, I volunteer my services as the ethnographer.)

Furthermore, women must find a way to bring in the outliers, those women who refuse the new terms and reap considerable benefits from doing so. There must be some kind of moral suasion going on here, as women police the behavior of other women. Chances this are this happens through the distribution of scorn and accusations of ‘trashiness.” We might think of this as a process by which the “more” women withdraw the social capital possessed by the “less” women. The “less” women are now admired by men but mocked by women.

In this case, there is an economy of social capital that we do not understand. This is a great place for economists to help out in the anthropological domain.

Some additional, purely anthropological considerations:

Some of this turns on cultural tectonics. There are cultural ideas at work, moving beneath, and inflecting, the surface of the marketplace. A very brief sketch:

1) In the 1960s: women present themselves in a more or less sexual manner. The counter-cultural has set new standards of candor.

2) In the 1970s: women begin to think that male reaction to this sexuality is offensive. As one of them told me, ‘they are not reacting to me, they are reacting to my body.” . Feminism is ignited. Wolf whistles and other reactions were now greeted with hostility

3) In the 1980s: women wear more. The preppie trend is a “cover up” look and relatively asexual.

4) 1985: Madonna, in her famous boy-toy video of 1985, gives the “all-clear” signal. She argues that women should reembrace their sexuality…as long as they can choose the outcome of this sexuality. Women wear less.

5) Summer of 2004: women start to wear more.

Some of this comes is due to the “max out” problem. But some of it may be a reflection of a deeper tectonic shift.

It may be that women are unhappy with what the “wearing less” did to men. Almost certainly, it was one of the things that encouraged men to think of themselves as “dogs.” (See several posts on this blog on this topic.) In short, a change in women provoked a change in men that women did not like and would now like to change.

If this is so, we are looking at the start of a new stage in the “gender wars.” Men, consider this an early warning. It’s not just the clothing that’s going to change.

As to the larger question, how we think about the interactions of anthropological considerations and economic ones, clearly there is lots to do. How do actors compete when this competition is informed by cultural considerations? How are the cultural considerations shaped and inflected by the competition? You’re asking me?

References

La Ferla, Ruth. 2004. What Stylish Young Women are Wearing: More. New York Times. June 8, 2004.

Thanks to actress Rebecca Budiq for the use of her photo.

I take a frictionless economy to be a place in which transaction costs, channel constraints, information uncertainties, and production inefficiencies are reduced as much as possible. (With apologies to my economics readers. I will be sure to get some of these details wrong, but bear with me.)

So Amazon makes for a frictionless economy to the extent that it removes costs incurred getting books into bookstores and out again. If there were ever a channel more inefficient than book distribution, it would be hard to imagine. With hundreds of thousands of titles in print, the chances are good that our local book store won’t have the book we want and will have books we don’t. The result is lost sales on the one hand, remainder copies, on the other. In that miraculous moment when we do find the book we want, we pay a price inflated to cover the inefficiencies of the system. Enter Amazon: all books all the time, with disintermediated delivery direct to our door.

But there are two problems that will make the friction worse. First, consumer taste and preference is fragmenting. This makes matching production against consumption more difficult. The simplicities of mass production have disappeared. Second, consumer taste and preference is changing more quickly. This means that the producer has a smaller “window” in the marketplace. Arrive too early and the offering is merely strange. Arrive too late and it is simply dull. In sum, the producer must now make more product offerings and “drop” them into the market with newly astute timing.

It turns out, the marketplace has succeeded pretty well in responding to the first problem. It now produces a profusion of products. This is the work of many, smaller players playing the niche, and the discovery that “economies of scale” are possible even for an assembly line producing variations on a theme. “Mass” manufacture now produces microvariation without much difficulty. (See Baldwin and Clark, and Kostelanetz, below.)

But it is not so good at the second. Even with better marketing intelligence from the likes of McKinsey, Roper, Faith Popcorn and the cool hunters, the failure rate is still astonishing. Very large and wealthy corporations continue to make things we don’t want and to fail to make things we do. At this writing, the Gap, with the help of Sarah Jessica Parker, is undertaking a new move to more fashionable clothing. We will see if they get this right. Their last attempt to do so ended very badly. (See Gladwell, and Postrel below.)

This is a necessary problem. Producer dynamism will never catch consumer dynamism because the more it responds, the more it creates. Consumers live in an information, stimulus, opportunity rich environment. The more choice we give them, the more difference they will cultivate. Taste and preference now runs like a wave the producer cannot catch because it’s best efforts drive the wave beyond its grasp. In sum, now to return to the economist’s turn of phrase, capitalism creates its own friction. However much friction it removes from production, the more friction in creates in the market to which it must respond.

I have no idea how economists think about this problem, but I do know that it makes for an interesting problem for anthropology and the anthropologist. It means that there is a steady pressure for differentiation going on in a culture that is already almost impossibly rich in differentiation. Change that used to come from the outside now comes from within. Capitalism was once a grumpy, clueless aunt, prepared to change only when this change was forced upon it. Now it is one of the chief agents of that change. The fact that it will never catch it up does not mean that it will not get a great deal faster. By taking friction out, it will help put friction in.

It’s a thrilling prospect and one that makes the head spin. When we get this “friction” out, when corporations detect and respond to shift in consumer taste and preference in something closer to real time, what will our culture look like? How will anyone, economists, anthropologists, corporations, keep up? What happens when social life and the marketplace changes before our eyes? Life will become a blur. On second thought, I guess it’s that already.

References

Baldwin, Carliss Y, and Kim B Clark. 2000. Design rules the power of modularity. Cambridge, Mass: MIT Press.

Gladwell, Malcolm. 1997. The Coolhunt. The New Yorker. March 17, 1997: 78-88.

Kostelanetz, Richard. 1968. Beyond left & right: Radical thought for our times. New York: Morrow.

Postrel, Virginia I. 2003. The substance of style: how the rise of aesthetic value is remaking commerce, culture, and consciousness. New York: HarperCollins.

Most anthropologists are pretty bad at explaining how culture and the economy work together to fashion our world in an emergent way (see my post for May 6 for a statement of the problem).

In his remarkable new book, The Company of Strangers, Paul Seabright, an economist, goes squarely at the issue.

He begins by describing his new shirt.

The cotton was grown in India, from seeds developed in the United States; the artificial fiber in the thread count comes from Portugal and the material in the dyes from at least six other countries; the collar linings come from Brazil, and the machinery for weaving, cutting, and sewing from Germany; the shirt itself was made up in Malaysia. (p. 13)

This sounds a little like Tyler Cowen’s treatment of a global economy, but Seabright has another purpose in mind.

What, he asks, if shirt production had to be planned?

One can imagine an incoming president of the United States being presented with a report entitled The World’s Need for Shirts, trembling at its contents, and immediately setting up a Presidential Task Force. The United Nations would hold conferences on ways to enhance international cooperation in shirt-making, and there would be arguments over whether the UN or the U.S. should take the lead. The pope and the archbishop of Canterbury would issue calls for everyone to pull together to endure that the world’s needs were met, and committees of bishops and pop stars would periodically remind us that s shirt on one’s back is a human right. … Experts would be commissioned to examine the wisdom of making collars in Brazil for shirts made in Malaysia for re-export to Brazil. More experts would suggest that by cutting back on the wasteful variety of frivolous styles it would be possible to make dramatic improvements in the total number of shirts produced. (14)

But of course new shirts don’t come from planning. As Seabright says,

The entire enterprise of supply shirts in thousands and thousands of styles to millions and millions of people takes place without any overall coordination at all. (14)

We forget how miraculous are the emergent properties of this enterprise.

Citizens of the industrialized market economies have lost their sense of wonder at the fact that they can decide spontaneously to go out in search of food, clothing, furniture and thousands of other useful, attractive, frivolous or life-saving items and when they do so, somebody will have anticipated their actions and thoughtfully made such items available for them to buy. (15)

And this is the point of this remarkable book. This is to show:

how even some of the simplest activities of modern society depend upon intricate webs of international cooperation that function without anyone’s being in overall charge. … It seems hard to believe that something as complex as a modern industrial society could possibly work at all without an overall guiding intelligence, but since the work of the economist Adam Smith in the eighteenth century, we have come to realize that this is exactly how things are. (4)

What particularly interests Seabright is that this miracle of coordination is now being performed by ‘the same shy, murderous ape that had avoided strangers throughout its evolutionary history” and now somehow proves capable of “living, working and moving among complete strangers in their millions.” That is to say, us.

The question is a good one: “how the hell does this happen?” How does impossibly complicated order emerge from various, uncoordinated, unplanned projects. Complexity theory is one answer to this question. Seabright has another.

This book is highly recommended.

Reference

Cowen, Tyler. 2002. Creative Destruction: How Globalization Is Changing the World’s Cultures. Princeton: Princeton University Press.

Seabright, Paul. 2004. The Company of Strangers: A natural history of economic life. Princeton: Princeton University Press.

From time to time, I try to think like an economist. (Now that I’ve given up trying to walk like an Egyptian.) Yesterday, in a used book store I asked myself this question: why is the same book more expensive when new, and less expensive when used?

If a used book is in good shape, it’s utility is indistinquishable from that of the new version. Furthermore, it is now much harder to get. In fact, there may be just a handful copies of the title still extant. Furtherfurthermore, the world has had a chance to vote on the book and declare it, in some cases, a “classic.” The used book can be, in this way, more, or more obviously valuable, than the unknown commodity it was on first publication.

In short, supply has gone down. Demand has gone up. But used books are less expensive. Plainly, I am not thinking like an economist because an economist would know how to think about this…and I clearly don’t.

I am guessing that this must have something to do with inefficiences of the marketplace. The people who own and run used book stores are generally more interested in reading books than selling them. No, they don’t have a cash register, just a book of blank receipts from Woolworth’s. This is always hard to find in the chaos of litter on the front desk and more often than not, it is never found because it happens to be sitting under the bookstore cat.

So, ok, book stores are not technologically or commercially sophisticated. Plus, they have the problem of having to assess the value of products that exist in great, unmanagable profusion. Some day every book will have a RDIF tag that will allow the book to “phone home” to a market place that exists on line. The local merchant will know how many copies are extant (supply), what the state of demand is, and his/her price will reflect a true marketplace.

Right? But I think used books will still be cheaper than new ones…despite the fact that they are “just as good,” more scarce, and their value to the reader is more clear. I am guessing that this is because there is something like a newness premium. This is the one that can be calculated very precisely by what happens to the value of a car the moment its first owner “puts his foot on the acceleration.”

How do economists explain the newness premium? (If that’s what’s going on here.)

In sum:

In a couple of places here I have doubted the intersection of anthropology and economics. And the question becomes “if it’s so hard, why bother?” From the anthropological side, the answer is clear. Much of the order of contemporary, First World, societies comes not from culture but from the marketplace.

In total:

The great preoccupation of anthropology is the idea of “culture.” The power of this idea was, in part and for some, that it allowed the specification of the shared ideas and rules that made the coordination of social life possible. Anthropologists liked the idea of culture so much they made it their intellectual accomplishment and chief export. (This was before they ran into post-modernism.)

But there was a problem with the notion of culture. It encouraged anthropologists to suppose that order is, as it were, grammatical, that it comes from a shared code of ideas and rules. And we know that very little of the order of First World cultures happens this way. Most of this order comes from the interactions of parties who are multiple, various, competitive, and sometimes contentious…parties, that is to say, who have very little in common and almost never a shared code. Merely by agreeing to a few, simple ideas (and nothing so sophisticated or embedded as a code), these parties can engage with one another. This order is, as we say, emergent. It is not code or culture based. Parties can interact without much sharedness and that they come away with their differences intact.

This means two things: first, that the anthropologist’s great theoretical mainstay will not serve them in the First World as it does in traditional societies, and, second, they must visit the disciplines that understand order that obeys an “invisible hand.” This means economics and complexity theory, for starters. What anthropologists cannot do is what they usually do: first, to insist the contemporary First World cultures are not cultures so there is nothing to study, and, second, that in the absence of culture, they are entitled to take the ball and go home. Anthropologists have found many ways to make themselves provincial and to absent themselves from the urgent questions of the day. They will try this here as well. But what would Durkheim say? I mean, really, get a grip.

Thanks to Tyler Cowen for his kind words here.

Tyler Cowen has some discouraging words about Sweden. My remarks yesterday about Canada address the same problem from a different point of view.

This much is clear. The “wealth of nations” will depend upon who does and doesn’t do dynamism. Canada and Sweden have committed to marketplaces and to cultures that are deeply suspicious and refusing of dynamism. In the next few years, as the world speeds up, this must tell.

The intersection of anthropology and economics is a strange place to be.

For many anthropologists, the notion of a marketplace is at odds with the notion of culture. This is why so many of them take vows of intellectual celibacy when it comes to capitalism. They just won’t go there. They don’t know anything about it; they dont want to know anything about it. (To put this in the language of Robert Johnson and the blues, anthropologists typically believe this intersection is a cross roads where one can expect to meet the devil.)

But I am not one of these anthropologists. My objective is to see how culture and commerce are mutually presupposing in First World societies.

This raises all kinds of intellectual puzzles.

On the anthropological side, there is a question of how the economy works as a cultural operator, how it works as a way of enabling and apportioning cultural meaning. This issue is taken up in the first essay below.

On the economic side, there is the question of how value is created out of meaning, how culture works as a way of enabling and apportioning market value. This is the issue is taken up in the second essay below.

Both these essays have appeared on this blog before, but it was only yesterday that I realized that they work as useful bookends for the blog itself and should appear together.

Essay #1

I was talking to a New Yorker recently about an upcoming trip.

“Where are you staying in the city?” she asked.

“Oh, mid-town”

Actually, this was just a guess. I like to sound like an insider. So I use “upper west side,” “soho,” “tribeca” with nonchalance. But to be honest, I am never exactly certain I have got my terms right.

“But where, exactly.”

Damn.

“Um, on 49th, near the Plaza.”

“Ok.”

Whew! Guessed right.

I put down the phone in a vertiginous moment. These neighborhood labels are a little testing for a rube from Canada. (I am in another classificatory scheme, “bridge, tunnel and border.”) But as a classificatory scheme, these labels are almost nothing at all.

And this is where anthropology meets economics. For the neighborhood labels are, like most cultural schemes, pretty general. There are, and now I’m really guessing, about 12 of them. (Ok, I know this because I just googled the question.) That’s 12 categories to cover an island that contains, um, 8 million people.

And here’s where it gets vertiginous. As I put down the phone, I realized that these 12 cultural categories contain, roughly, 19.5 economic distinctions. This is the number of discrete prices for property in Manhattan. (This assumes that the most expensive property sells for $20 million and there is no property that sells for less than $500,000, and that there is, or could be, a property for sale for every dollar amount.) (I am sure there are places that sell for more than $20 million, but you get the idea.)

Let’s review. Culture gives us 12 distinctions. Economics gives us 19.5 million distinctions.

This is not to mock culture. We are very happy to have a set of 12 categories that somehow manages to map the great, blooming diversity called Manhattan. Without it, many things, including a taxi ride, would be vastly more difficult. It’s always true that we want embracing classificatory schemes and without them would be lost in a welter of detail.

But compare this cultural valuation to economic valuation. With this classicatory scheme, we can make endlessly fine distinctions. We can mark the difference between a Soho condo on the 4th floor and the 5th floor. We can distinquish between a property that has double paned windows and with single panes. We can in other words make impossible fine distinctions. And in the process we can what many things are worth: sides of the building, views, neighborhoods, access to a park. Clearly, only the virtuoso real estate agent is fully conversant in these distinctions. But all of us will defer to these distinctions if and when we buy a place on the island.

But what is really astonishing, and here is where culture must not just tip its hat to economics, but actually remove it in a gesture of abiding deference, the valuation scheme created by economics actually floats. All those monetary distinctions can change 1) over night, 2) without committee oversight, 3) in almost perfect concert.

That’s condo on 5th avenue that is now worth $8.3 million will sometimes fluctuate with stock market as its owners sleep. Oh, the Japanese buy more dollars. Oh, the exchange rate changes. Oh, the markets respond. Oh, the owners wake up a little richer or a little poorer.

It’s nice to think of a city that has digital read-outs attached to every property, the numbers spinning up and down over the course of a day as the real estate market works out what value is and external factors impinge. Oh, someone just bought a place in your building for 1.5 million more than asking. Everyone’s value goes up a little. The market has spoken.

This is the mystery. Not for economists for they take this for granted. But for anthropologists. A classificatory scheme that lets the market “speak,” in very little voices, in the creation of millions of utterances that are prone to second guessing and revision many times a day.

Anthropology meets economics and comes away astonished.

Essay #2

Commerce has a way of making capital colourless. Here’s a corrective. (All names and figures are sheer guesswork and offered for illustrative purposes only. With apologies to Frank Capra.)

Sarah Zupko is a little girl in Red Deer, Alberta. Her Dad took her into town today. It’s January 4 ,1948. Her Dad stops at Woolworth’s for a coffee at the counter. He falls into conversation with his friends, other farmers, there: crops, water tables, combines, silage, almanacs, Indian summers and spring.

Sarah is pretty sure she couldn’t care less. She wanders though the aisles and comes eventually to rest in front of an illuminated glass case. There under glass is a watch, its perfect little numerals marching around the dial, delicate hands now still, and a metal band of cunning silver, a bracelet really. It is $9.60.

Sarah visits the case and the watch on every visit into town and magically on her 9th birthday, in late March, the watch is hers. The birthday party, thunderous with farm children and festivity, falls silent. The watch is hers.

The rest is economics. The Woolworth’s store in Red Deer keeps half of the $9.60 and the Chicago distributor keeps half of what’s left. By the time Mr. and Mrs. Zupko’s $9.60 finds its way into the Woolworth’s fortune, it has become 33 cents.

Value has migrated from a glass case to a large vault. But it does not stay there.

The Woolworths are building a summer home and 7 cents is spent to help hire men to clear the land that runs down to the point. The value Mr. Zupko extracted as winter wheat from prairie soil will actually now return to the ground as Mrs. Hudson, wife of one of the laborers, spends part of it to buy the seed for her summer garden. A dime will go to help pay for Mr. Woolworth’s dues at the Century Club and part of this will be spent on that bee’s wax that is used to give club chairs and tables the glow they give off in the light of the fire that burns all day in the library. Another dime will go to the grand tour that the eldest Woolworth daughter will take to Europe that year, a trip from which she will return with a taste for poetry and men who are a little bit dangerous. A few cents will even go to help pay for the clasp that holds the necklace that Mrs. Woolworth wears to the social event of the season, where it will be eclipsed by the still more magnificent jewelry worn by that jumped up Mrs. Chetwin, a creature who has finally pushed Mrs. Woolworth from her accustomed place of splendor.

The Woolworth’s family are a little like the mouth of the Fraser River, the place from which the tiny purchases made upstream by little girls in obscure places come rushing into the world, released from transit and their colorless state as mere capital, into labor, summer homes, spring vegetables, bee’s wax, grand tours, poetry, necklaces and social failure.

We’ve said nothing of the upward flow, how the value created by Woolworth’s working it’s way into a glass case and a watch…and from there into parental solicitude, and a little girl’s sense of herself. The watch that played the conduit for this flow upwards and downwards now sits in an antique store in Winnipeg, Manitoba, once more in a glass case, waiting for another chance to turn commerce into culture.