Title: Preference modification vs. incentive manipulation as tools of terrorist recruitment: the role of culture
1Preference modification vs. incentive
manipulation as tools of terrorist recruitment
the role of culture
- Michael Munger, Departments of
- Political Science and Economics
- Duke University
- Friday, Sept 30, 2005
2Problem of Acting as Society
- Can a group of people who disagree come to a
consensus? - I wantyou wantwhat do we want? COLLECTIVE
CHOICE PROBLEM - Even if they do agree, how could they coordinate
their actions? INFORMATION /
TRANSACTIONS COST PROBLEM - Even if they all know what to do, why would they
do it? FREE RIDER
/ COLLECTIVE ACTION
PROBLEM
3Information and Coordination
- The peculiar character of the problem of a
rational economic order is determined precisely
by the fact that the knowledge of the
circumstances of which we must make use never
exists in concentrated or integrated form but
solely as the dispersed bits of incomplete and
frequently contradictory knowledge which all the
separate individuals possess. The economic
problem of society is thus not merely a problem
of how to allocate "given" resourcesif "given"
is taken to mean given to a single mind which
deliberately solves the problem set by these
"data." It is rather a problem of how to secure
the best use of resources known to any of the
members of society, for ends whose relative
importance only these individuals know. Or, to
put it briefly, it is a problem of the
utilization of knowledge which is not given to
anyone in its totality. (F.A. Hayek, 1945, AER).
4Problem 2--Commitment Without Enforcement, Can
We Cooperate?
- Common Knowledge Basis of CooperationWhen I You
Know That I Know that it is in your interest to
cooperate - Can we account for irrational acts? Suicide
bombings, sacrifice of a life? Are the bombers
duped, or confused? - We tend to think the state is the only
answer.but..
5An Example of Cultural Difference
- shibboleth--The word is often combined with the
word cultural. - Its general meaning is mean an unspoken but
shared understanding of something that identifies
insiders, and distinguishes outsiders because
they do not share this understanding.
6Shibboleth
- Judges 12, 5-7, King James 21st Ed. Bible
- 5 And the Gileadites seized the passages of
the Jordan before the Ephraimites and it was so,
that when those Ephraimites who had escaped said,
"Let me go over," that the men of Gilead said
unto him, "Art thou an Ephraimite?" If he said,
"Nay," - 6 then said they unto him, "Say now
Shibboleth." And he said "Sibboleth," for he
could not frame to pronounce it right. Then they
took him and slew him at the passages of the
Jordan and there fell at that time of the
Ephraimites forty and two thousand.
7My Definition of Culture
- Culture The set of inherited beliefs,
attitudes, and moral strictures that a people use
to distinguish outsiders, to understand
themselves and to communicate with each other.
8Culture Is Inherited
- I have put quotations around the word inherited
above, not because I am quoting anyone, but
because the sense of the word is strained. - Hair texture, eye color, general buildthose
sorts of things are inherited. They are
hard-wired into the genetic structure of humans,
and children are directly and entirely the
product of their parents. - Culture is obviously not inherited like this. We
teach it to our children, or they learn it by
tacit and perhaps unconscious exposure over time.
- But it makes sense to think of culture as an
inheritance, or legacy from the past.
9Origins Two Concepts
- Spontaneous Order
- Intelligent Design
- Does order imply design? Strange disconnectMany
people who believe fervently in evolution in
biology insist on the need for design and control
in social and economic settings.
10The Questions that interest me
- Are preferences tastes, truly primitive
(chocolate v. vanilla), or are they culturally
conditioned or even instrumenal? - Are moral beliefs important? Are such beliefs
best treated as preferences or constraints? - Core values relatively fixed, strongly held,
primitives in terms of preference. Policy
beliefs not held instrumentally, but as ends in
themselves. Not irrational to sacrifice for
beliefs
11The Questions that interest me
- Are ideologies, or shared belief systems about
right and wrong, the key to understanding moral
beliefs? In the U.S., lots of research to say no.
But Islam, or Maoism, may have implications for
guerrilla movements - Are ideologies a kind of spontaneous order, not
explicitly designed but regular and consistent
across people and across time? Ideas--like
viruses? Reproduce, gain resources, but kill
their host.
12Emergence of Culture David Hume has Lunch at
Café Hayek (where orders emerge)
- Three claims about culture
- Order requires only regularity and consistency.
Human beings choose actions based on moral
conceptions, but also incentives and calculated
gains that accrue to one action rather than
another. - Purposive Action I am going to adopt the
convention that humans act purposively. (Didnt
say rationally) - People choose actions that they believe (rightly
or wrongly) will lead to a goal that they
consider (rightly or wrongly) desirable. These
conceptions of right and wrong may be Humean
conventions, not transcendent principles.
13Emergence of Culture David Hume has Lunch at
Café Hayek (where orders emerge)
- Surprising thing is that order can emerge, even
from disparate and uncoordinated application of
social convention. - Survival value of practices, or fashion, may be
conscious reason for adoption. But it is a
predictable, and measurable, consequence.
14Order vs. Design Which is Culture?
- CoyoteEvolution
- Dachshund / ChihuahuaSurvival
- DandelionEvolution
- RoseSurvival
- Wild TurkeysEvolution
- Domesticated TurkeysSurvival
15Choices Emerge.Do Preferences?
- Is there some evolutionary process that governs
preferences? - Are human political beliefs getting better over
time? - The key difference is the absence of any feedback
mechanism by which the merits of the emergent
order might be judged, or subjected to
modification.
16- Douglass North makes this point quite forcefully
Necessary conditions for what economists think
of as efficiency almost never exist in political
realm - Efficient markets are created in the real world
when competition is strong enough via arbitrage
and efficient information feedback to approximate
the Coase zero transaction cost conditions and
the parties can realize the gains from trade
inherent in the neo-classical argument. - But the informational and institutional
requirements necessary to achieve such efficient
markets are stringent. Players must not only have
objectives but know the correct way to achieve
them. But how do the players know the correct way
to achieve their objectives? The instrumental
rationality answer is that even though the actors
may initially have diverse and erroneous models,
the informational feedback process and
arbitraging actors will correct initially
incorrect models, punish deviant behavior and
lead surviving players to correct models.
(North, 1993).
17Will Culture Disappear?
- Ronald Heiner (1983) argues that as human
interaction becomes more complex and uncertain,
successful social institutions must reduce the
information needed to achieve cooperation among
individuals. - A persons overall behavior may actually be
improved by restricting flexibility to use
information or to chose particular actions (p.
564). - Mom and Pop hardware store vs. Walmart
- Farmers Market vs. Piggly Wiggly
18The End of History
- What is the cheapest way of achieving
cooperation? Formal rules and external
enforcement, or culture and shame/guilt
enforcement? Heiner (1983) - In general, further evolution toward social
interdependence will require institutions that
permit agents to know about successively smaller
fractions of the larger social environment. That
is, institutions must evolve which enable each
agent in the society to know less and less about
the behavior of other agents and about the
complex interdependencies generated by their
interaction (580 emphasis in original). - In WalMart world, ideologies would disappear.
Western, market-based societies with weak parties
and decentralized democratic institutionsthe end
of history?
19Institutional Design Information.and Commitment
- Institutions are the humanly devised rules of the
game that shape and direct human interactions. - Institutions reduce uncertainty by shrinking the
choice set of all of the players. If the rules
are not formalized, the players may spend too
much time arguing over the rules, and less time
competing in productive activities. The actual
choice of institutions, however, is hard, since
there are countless ways of restricting bad
choices. What makes some institutions better
than others? - The Preference Store Metapreference
20Step back for a moment.The Fundamental Human
Problem(according to Munger)
- How can we construct or preserve institutions
that make individual self-interest not
inconsistent with the common good?
21Two Approaches
- Madisonian
- Ambition must be made to counteract ambition
- Rousseauvian
- Transform the self, solve the problem of amour
propre. Inscribe the law on the hearts of men.
Some preferences are better than others.
22The Problem.
- The nature of exchange gains from trade. Both
are better off. - But only if the exchange takes place
transactions costs are the ex ante costs of
negotiating and measuring, and the ex post costs
of enforcing. Transactions costs can easily
overwhelm the potential gains from exchange. - Institutions and cultural beliefs closely
related to "common knowledge" problem in game
theory. Shared meanings, iconography, language,
symbols. Not just knowledge in the Hayekian
sense, but also commitment - But also may entirely block progress, lock in
institutions that are not Pareto optimal.
23Origins of culture
- The literature contains two strikingly different
accounts of the origins of culture, based on two
very different conceptions of its function. - One account is based on transactions cost and
commitment, while the other rests on the problem
of excludability and club goods. - The two accounts are not mutually exclusive, but
they do have strikingly different implications
for our understanding of culture.
24I. Commitment Device Real Piety
- Kreps (1990)
- Hierarchy
- Uncertainty
- Requires an organizing principle as a commitment
device.
25The Trust Game
Honor Trust
A 20 B 20
Total 40
Trust B
A ?10 B 30
Total 20
Do Not Honor Trust
A
B
Do Not Trust B
A 0 B 0
Total 0
26Hierarchy and Strategic Uncertainty
- It is Bs behavior that is in question somehow B
must persuade A that there is at least a high
probability that B will honor As trust if A
offers it. And there are real gains to be made
here, so there are significant pressures at work
to overcome this commitment problem. There are
two apparently different but mathematically
indistinguishable ways of solving the problem - B could post a bond, or submit to some kind of
binding third party enforcement that would punish
him if he violates trust, or - B could persuade A that cares so much for A, or
that B cares so much for his own honor, that he
will not violate the trust, because it would not
be in his interest to do so, given Bs self
interest properly understood. - Similar in terms of analytics, but a world of
difference in terms of practical implications,
and beliefs.
27Hierarchy and Strategic Uncertainty
- Outside enforcement Hobbes covenants, without
the sword, are but words - Beliefs Rousseau inscribe the law on the
hearts of men - It is common to dismiss this difference, but in
fact the distinction may be the very heart of the
matter for the society. - Dead weight loss to society has two parts (1)
The size of the transactions cost sector of the
society, and (2) Other exchanges precluded by an
inability to reduce transactions costs to the
point where those otherwise profitable
transactions can take place - This loss is a direct function of the societys
set of moral beliefs that condition interactions.
It will surprise no one at this point that I
want to call this whole set of moral beliefs and
conditioning factors for economic and social
exchange by the vague name I mentioned earlier
culture.
28II. Club Goods Good Works
- A standard set-up for the club goods approach is
Bermans (2003) - Imagine a community for which neither government
nor markets function well. Local public goods
usually provided by government such as public
safety, law and order and welfare services are
poorly provided or absent, while neither public
nor private sectors efficiently deliver
education, health services, or insurance. It
would not be surprising for individuals in such a
place to band together into communities which
provide public safety, education, welfare
services, and other local public goods through
mutual insurance. (Berman, 2003, p. 2)
29Game 1 Prisoners Dilemma
Cooperate Defect
Cooperate (2,2) (4,1)
Defect (1,4) (3,3)
ORDINAL PREFERENCES 1 is good, 4 is bad
30Game 1? Prisoners Dilemma with External
Enforcement Defectors are Tortured their
Families Killed
Cooperate Defect
Cooperate (1,1) (2,4)
Defect (4,2) (3,3)
ORDINAL PREFERENCES 1 is good, 4 is bad
31Game 1? ? Prisoners Dilemma with External
Enforcement Defectors Feel Really Bad
Cooperate Defect
Cooperate (1,1) (2,4)
Defect (4,2) (3,3)
ORDINAL PREFERENCES 1 is good, 4 is bad
32Game 2 Culture War
Cooperate Defect
Cooperate (3,3) (4,1)
Defect (1,4) (2,2)
ORDINAL PREFERENCES 1 is good, 4 is bad
33Game 3 U.S. in Iraq1992No Equilibrium.
Anti-Saddam Insurgency? U.S. ? Cooperate Defect
Cooperate (2,1) (3,3)
Defect (1,4) (4,2)
ORDINAL PREFERENCES 1 is good, 4 is bad
34Game 3 U.S. in Iraq2005Side Payments.Be
Rational
Anti-U.S. (Sunni) Insurgency? U.S. ? Cooperate Defect
Cooperate (1,3) (2,1)
Defect (4,4) (3,2)
ORDINAL PREFERENCES 1 is good, 4 is bad
35If Club Goods.
- If participation in terrorist organizations is
primarily an in-kind payment for access to club
goods, then policies that reduce the marginal
value of such club goods will be most effective.
- A concerted effort to break up social networks,
in cases where groups with terrorist ties (such
as Hamas, or IRA) also provide local public goods
such as schools, police services, etc., and
replace those organizations with publicly
provided services, would have an immediate impact
out of all proportion to the cost. - Though the dividing line between police
services and protection racket may be blurred,
it is clearly true that the IRA (in Northern
Ireland) and Hamas (in the Palestinian
territories or in other parts of the Middle East)
provided services valued by many local citizens.
36If Club Goods.
- Furthermore, if the problem is an
incentives-based choice, it becomes clearer why
medieval punishments have often been employed by
occupiers fighting resistance groups using terror
tactics. - The rack, drawing-and-quartering, or other public
displays of savage retribution reduce the value
of access to local public goods as a matter of
simple cost-and-benefit calculations. - While this observation does not justify the use
of such tactics, it does explain why they have
been so commonly observed throughout history.
37If Preferences.
- If, on the other hand, a preference for
cooperation can be inculcated or selectively
recruited, then such tactics are likely to
backfire. - If the primary good is psychological solidarity
with an identifiable group, then public abuse or
torture may only harden the resolve of those
committed to cooperation with terror groups. - To the extent that abuse of some populations
solidify in-group vs. out-group psychological
identifications, attempts to use incentives can
precipitate the culture war setting described
earlier in this paper. - In that setting, publicly uncooperative behavior
becomes valued as an end in itself, and even
apparently Pareto-superior compromises on
territory may be ruled out. If the preferences
are primitives, not possible to compensate or buy
out terrorists with alternative incentives.
38A movie Positive Feedback.