Everyday anarchy
- Most of the world, for most of its history
- More than half the world's government: "weak" or 'failed'
- International arena: between governments and between citizens
- "Pockets of anarchy" in developed countries
=> Governance: some system of rules/law and means of enforcement of facilitating social order
=> Government: one sort of organization to ensure governance => Legitimized monopoly of force in a territory
=> Studying anarchist order => 'kind of a side show' <=> it actually is important for understanding (austrian) economics.
=> Even though we live in a world with many governments: most of our interactions happen in anarchic situations.
Sideshow or necessity
- Mises on Menger's theory of money: quintessentially "praexeological theory", pointed to its "import ... for the elucidation of fundamental principles of praxeology and its methods of research" (1949: 402)
- Why? Tri-part emhasis on:
=> Human Purposiveness
=> Social Cooperation
=> Institutions
- Ricardian Law of Association
3 cases
- Easy case: effective self-government in the 'state's shadow'
=> Nearly all agree that it's possible
- Hard case: effective self government outside the 'state's shadow'
=> Nearly all agree this is impossible where pops are large, diverse, or require a SE solution to violence.
- Hardest case: self governing society that generates wealth
=> Nearly all agree this is impossible.
The Easy case: self-enforcing contracts
- Used when: government contract enforcement is absent/prohibitively costly.
- Mechanism: folk theorem => Unsophisticated
- Ex. Jewish Diamond traders; how neighbors settle disputes
- Limits: infinitely-repeated play; low time preference; low-cost communication (pop size and diversity); common idea about cheating; equal strength; can't create encompassing social order
- Bottom line: indispensable, but, alone, very limited (intra-group social cooperation) => conventional wisdom correct.
The Hard Case: Large Population and Social Diversity
- Used when: government contract enforcement is absent/prohibitively costly
- Mechanism: folk theorem + signaling => Sophisticated
- Ex: Logos/signage; lex Mercatoria; precolonial Africa, gangs
- Limits: infinitely repeated play; low time-preference; equal strength; can't create encompassing social order
- Botom line: facilitates inter-group cooperation => conventional wisdom mistaken
The Hard Case: Violence
- Used when: government protection absent
- Mechanism: violence; credit; other => sophistication depends.
- Ex: American West; feud, leges marchiarum
- Limits: depends... jurisdictional conflict; out-of-equilibrium escalation; other
- Bottom line: might need not make right => conventional wisdom mistaken
Rich and stateless?
- We have examples of fully self-governing societies: medieval Iceland, pirates, tribes, Somalia, etc.
- But how rich are/were they? Existence =/= efficiency.
- True! So what can we say about self-governance efficiency?
What doesn't shed light on the Hardest Case Question?
- Every country in the world has government (almost)
=> Every country in the world has tariffs: does that prove it's efficient? => No, it proves that it is in some peoples advantage.
- (Insert stateless society) is/was very poor
=> You aren't comparing the relevant institutions
- Private Institutions can't facilitate large volumes of trade
=> It's wrong => They can. A quarter of world GDP is caused by private institutions.
- (Insert N. American, W. European country)'s government can clearly facilitate more social cooperation than (insert stateless society)'s system of private governance
=> It doesn't tell us anything: you aren't comparing relevant institutions.
What are we left with?
- Compare the 'best' anarchy with 'the best' state; but compare the 50th 'best' anarchy with the '50th' best government.
- Somalia: pre and post anarchy: almost on every indicator: somalia has improved.
- Unqualified claims about the HCQ in either direction aren't going to be right
- Avoid the wrong question: why aren't any privately ordered societies richer?
- Ask the right question: compared to the relevant institutional alternative in this case: how does (might) private ordering fare?
- Comparing relevant alternatives, it seems that in many and perhaps most cases in the world at the moment, private ordening would fare well.
- We have much empirical and theoretical work left to do on the HCQ.
- Public choice is essential to aswering the HCQ.
- Studying anarchy isn't a luxury.
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