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Economic Systems: Perspectives on Human Motives and Exchange

Explore formalist economics and alternative economic systems through an anthropological lens, examining market economies, reciprocity, and prestige exchange in various cultures. Discover the complexities of maximizing profit, prestige, and subsistence in diverse societies.

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Economic Systems: Perspectives on Human Motives and Exchange

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  1. ECONOMIC SYSTEMS An Anthropological Perspective

  2. Bartering

  3. Are All Humans Driven by a Profit Motive to Accumulate? • How many would ask your boss for a salary cut? • Who aspires to earn less in 5 years than you do now? • Which of your possessions are you willing to give up?

  4. The Capitalist Market Economy • Assumptions: • The world is a commodity • Human material wants are unlimited • The means to acquire these wants limited • People economize – make rational choices among alternatives to maximize individual profit • We allocate scarce resources to increase material well-being • New car? Send child to college? Vacation?

  5. FORMALIST ECONOMICS • The Capitalist Market Economy • Maximization • Free Market – Law of Supply & Demand (“Invisible Hand”) • Labor is a Commodity • Mechanized Technology (“efficiency”) • Rationality • Capitalism Requires Accumulation • Inequality is Inherent

  6. The Big Assumption: • Formalist Economics can be applied to ANY society

  7. Can Formalist Economics be Applied to Understand Non-Capitalist Societies? • How well can we understand behavior in other cultures as maximizing or based on profit motive? • Some cultures maximize social realtions • !Kung – Ethic of Reciprocity • Some cultures maximize Prestige • Melanesia – Big Man gives away wealth • Kwakiutl – Potlatch

  8. Karl Polanyi, Substantivist: 3 Systems of Exchange • Reciprocity • Generalized Reciprocity (!Kung, Bands) • Balanced Reciprocity (Trobriand Kula, Tribes) • Negative Reciprocity (Gambling, theft) • Redistribution (Kwakiutl, Chiefdoms) • Market Principle (U.S., States) • Price based on supply & demand

  9. All forms may be present: • U.S. generalized reciprocity – • U.S. balanced reciprocity – • U.S. redistribution –

  10. Non-Capitalist Economies • Tiv Spheres of Exchange (Nigeria) • Prestige can be a scarce good • Prestige is the basis of an elaborate economic institution that has little to do with subsistence • Multicentric economy: exclusive spheres of exchange marked by different moral values

  11. WIVES – Rights in Wives, Brass Rods = Special Purpose Money PRESTIGE – Exchange at ceremonies: Slaves, cattle, ritual office, Medicine, Magic, Brass Rods = General Purpose Money within the sphere; Do not enter market sphere SUBSISTENCE – barter WIVES PRESTIGE SUBSITENCE

  12. Wives Sphere • Marriage: Sister exchange • The only “price” for a woman is another woman • Ward-sharing groups; exchange in women lags in time • Brass Rods or Cattle = Ernest Payment during lag • Bridewealth is paid with prestige goods, brass rods

  13. Rationale: Invest to convert subsistence goods into prestige goods & prestige goods into wives • CONVEYENCE: Exchange within a sphere (morally neutral) • CONVERSION: Exchange between spheres (moral quality) • The Ultimate Maximization

  14. MONEY • MEANS OF EXCHANGE: Use to purchase goods • MODE OF PAYMENT: Use to pay debts • STANDARD OF VALUE: Can compare value of goods

  15. If money serves all 3 purposes, it is GENERAL PURPOSE MONEY • If money serves only 1 or 2 of the purposes, it is SPECIAL PURPOSE MONEY • Do we have special purpose money?

  16. If money serves all 3 purposes, it is GENERAL PURPOSE MONEY • If money serves only 1 or 2 of the purposes, it is SPECIAL PURPOSE MONEY • Do we have special purpose money? • Meal ticket • Copy card • Bus token

  17. Which did the Tiv have? • Brass Rods = GENERAL PURPOSE MONEY WITHIN the Prestige Sphere • Brass Rods = SPECIAL PURPOSE MONEY ONLY in the Wives Sphere

  18. Change • The British Colonial System introduced General Purpose Money • This broke down distinctions between the three spheres • The British imposed taxes & outlawed sister exchange • The Tiv paid for wives in money, thus converting down • The price of bridewealth soared • Wealth differences increased • Debts increased

  19. Trobriand Kula Ring The Trobrianders maximize prestige • Kula is a formalized exchange system, distinct from subsistence activities • Life-long trading partners • The more partners, the more prestige • Each shell necklace or armband has a known history, acquires fame

  20. Trobriand Kula Ring

  21. Magical rituals for safe trip, to make trading partner generous • Sea reefs, giant octopii, flying witches • The danger makes kula trade seem irrational • Taboos on sex

  22. Complex Kula Rules • Only trading partners exchange prestige items • They are given to trading partners with great ceremony • Host is obligated to trade & offer hospitality to guest • Subsidiary trade takes place among non-partners • These are practical items with no ritual value

  23. The Kula gifts are not kept—prestige is gained by giving it away in ritual gesture • There is expectation that items of comparable value will be exchanged within a reasonable time • This is an example of BALANCED RECIPROCITY

  24. Kwakiutl Potlatch • “Potlatch” means “gift” • Prestige is acquired by giving valuable gifts away • Each village has a hierarchy of offices marked by titles, crests, the rights to masks, songs, & symbols used in ceremonies

  25. Potlatch • Is held to validate hereditary titles & social rank • Totem poles symbolize the ancestral titles claimed by chiefs of the village • Rank & prestige are scarce commodities • Amount of goods given away reveals prestige

  26. How to Potlatch • The host traces his line of descent • Recounts the ancestral origin of the title he seeks • Demonstrates the validity of his claim to the title, privileges, masks, etc. • Until publicly validated, no right to titles • Like notarizing a document

  27. The Potlatch Unit • The extended family of the chief • Assist in preparation & assembling goods for distribution • Convince others to give blankets, carved cedar chests, barrels of oil, boats, etc. • The group may spend years accumulating enough goods

  28. Formal Ritual With Complex Rules • Invite guests from other villages • Guests are seated in rank order • Speech making • Display of crests, masks, performance of dances • Presentation of title • Redistribution of gifts, according to rank order of guests

  29. Elaborate System of Conversion Among Economic Spheres • Coppers: (prestige item) • Each is named, has a history that is publicly known • If coppers are given away in ceremony, value is now in the prestige sphere 1875

  30. Conversion The ideal is the conversion of goods into a higher, prestige sphere • Introduction of a cash economy intensified the potlatch • Caused inflation • Introduction of trade goods led to rivalry potlatches

  31. Rivalry Potlatch • Where two potential heirs claimed the same title • Each rival held a potlatch, invited the same guests, denied or belittled the claims of his rival • To show economic superiority, destroyed valuable goods

  32. Aim: to convert goods into coppers, acquire the ultimate prestige of destroying the copper • Break copper into pieces & throw into sea • 1880s Canadian law prohibited potlatch & police confiscated the coppers

  33. Potlatch is an example of REDISTRIBUTION

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