Anthropology Economics and Choice Book

Anthropology, Economics, and Choice
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Anthropology, Economics,
and Choice
michael chibnik
University of Texas Press Austin

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Library of Congress Cataloging-in-Publication Data
Chibnik, Michael
Anthropology, economics, and choice / Michael Chibnik.
p. cm.
Includes bibliographical references and index.
iSbn 978-0-292-72676-5 (cloth : alk. paper) —
iSbn 978-0-292-72902-5 (pbk. : alk. paper) —
iSbn 978-0-292-73535-4 (e-book)
1. Economic anthropology—Case studies. I. Title.
Gn448.c47 2011
306.3—dc23 2011019003
Contents
Preface vii
Acknowledgments ix
Introduction 1
1. How Important Is Decision Making? 20
2. Choices between Paid and Unpaid Work 38
3. Risk, Uncertainty, and Decision Making 60
4. Experimental Games and Choices about Cooperation 90
5. Who Makes Household Economic Decisions? 118
6. Is There a Tragedy of the Commons? 142
Conclusion 164
Notes 173
References 177
Index 197
Preface
During 2008–2009 the world’s economy was mired in a terrible reces-

sion. As nations struggled with rising unemployment, failing businesses,
massive deficits, and plummeting stock prices, their angry residents won-
dered what had caused these problems and how they might be resolved.
Economists were often in the news during this time. Some commentators
blamed economists for promoting policies that led up to the crisis; others
looked to them for predictions about what might happen next. Prominent
economists wrote books and columns analyzing the recession and propos-
ing paths to recovery.
When most economists offer explanations of events such as the global
recession of 2008–2009, they are guided by their discipline’s ideas about
how individuals and groups allocate scarce resources. Many are influ-
enced by rational choice theory, which assumes that such decisions are
made by well-informed, intelligent people who consciously or subcon-
sciously weigh the risks, costs, and benefits of alternative actions. Yet we
all know that decision makers are often muddled about what they want,
confused about the possible costs and benefits of different choices, and
uncertain about what the future might bring.
Economic anthropology is a small subfield of a discipline that is much
less influential than mainstream economics. Nonetheless, the hetero-
dox views of economic anthropologists present an important, iconoclas-
tic challenge to conventional ways of looking at choice. These scholars
think that theories based on rational choice rely too much on elaborate
mathematical models that make dubious assumptions about a limited set
of variables and pay too little attention to the context and complexities of
real-world decisions. Most economic anthropologists analyzing decision
making emphasize how historical changes, cultural norms, and socioeco-
viii Anthropology, Economics, and Choice
nomic institutions constrain the choices possible for different groups of

people at particular times and places.
The heart of this book consists of a comparison of the ways that dif-
ferent social sciences—particularly economics and anthropology—have
looked at five important issues in the analysis of economic decision
making: choices between paid and unpaid work; ways people deal with
risk and uncertainty; how individuals decide whether to cooperate with
one another; the extent to which households can be regarded as decision
making units; and the celebrated “tragedy of the commons.” These issues
involve basic questions in the social sciences such as the distinction be-
tween “use value” and “exchange value,” the extent to which human beings
are altruistic, the ways in which societies attempt to limit the untram-
meled pursuit of self-interest, the nature of “rationality,” and the degree
to which “economics” and “culture” can be analytically separated.
In recent years, economists have become increasingly confident that
their methods can aid both in the understanding of such general ques-
tions and in the solving of down-to-earth practical problems. Although I
do not share the economists’ confidence in the usefulness of their theo-
ries, I make no claims to have provided definitive answers to any of the
questions that I raise in this book. My goal is to provide accessible ex-
planations, as jargon-free as possible, of the ways that different groups
of scholars have thought about some fundamental, intriguing questions
about decision making. I have included numerous ethnographic examples
of decision making from my own research. I do so because I think that the
pluses and minuses of abstract theories can most easily be understood and
assessed by looking carefully at their applicability (or lack of applicability)
to real-world examples.
I have been an economic anthropologist for almost four decades. It
would be natural to assume that my research methods incorporate tech-
niques drawn from economics. This was certainly the case at the outset of
my career when I carried out doctoral fieldwork in Belize. With a back-
ground in mathematics and a commitment to anthropology as a science, I
attempted to apply models from economics to the agricultural decisions I
studied. Although these models were useful, I found that they did not help
my understanding of important aspects of what I observed. During sub-
sequent research in Peru, Mexico, and United States, I became increas-
ingly convinced of the value of ethnographic approaches to choice. I now
think that anthropologists and economists see the world in very different
ways. This book begins by exploring why this is so.
Acknowledgments
In 1976 I applied for a postdoctoral position in the Department of An-

thropology at the University of California, Berkeley. I proposed to use
my time as a postdoc to write a book about some knotty problems in eco-
nomic and ecological anthropology. These included the monetary value
of subsistence production, decision making under risk and uncertainty,
the effects of household composition on agricultural decision making,
and the ways that societies attempt to prevent environmental damage
caused by individuals pursuing their “rational” self-interest. Although I
spent a worthwhile, enjoyable year as a postdoc at Berkeley, I unsurpris-
ingly did not come close to writing the ambitious book I had proposed.
Nonetheless, in the ensuing years I have continued to conduct research on
issues related to those discussed in my postdoc application. Much of what
I have written here consists of my current thoughts about these issues.
This book is quite different from the one I planned to write all those
years ago. After conducting fieldwork in diverse field sites, I have become
more convinced of the value of ethnography and history and less willing
to embrace the parsimony of mathematical models of human behavior.
Theories have come and gone as anthropologists and economists in new
research settings have been forced to revise their ideas about decision
making.
I wrote this book between 2008 and 2010. For the most part I did this
alone, consulting with only a few people. But in a larger sense, the book is
the outcome of more than three decades of research and teaching. Here I
can mention only a few of the many institutions and people that have
helped me.
The writing of this book and much of the research discussed here have
been funded by Career Development Awards and other kinds of insti-
x Anthropology, Economics, and Choice
tutional support from the University of Iowa. I have also received im-
portant support over the past several decades from Columbia University,
the University of California–Berkeley, the National Science Foundation,
the National Institute of Mental Health, the Welte Institute for Oaxacan
Studies, and the Federación de Campesinos de Maynas in Peru.
My biggest debt is to all the people in the field who have listened to my
never-ending questions about their lives. The following people have also
helped me greatly in various ways: Shirley Ahlgren, Saúl Aragón, Peggy
Barlett, Gerald Britan, Carole Browner, Holly Carver, Katharine Chib-
nik, Jeffrey Cohen, Beth Conklin, Rudi Colloredo-Mansfeld, Wil de Jong,
Gudrun Dohrmann, Virginia Dominguez, Susanna Donaldson, Nora En-
gland, Arthur Goldhammer, Paul Greenough, Lourdes Gutiérrez Ná-
jera, Charles A. Hale, Angelique Haugerud, Jorge Hernández, Douglas
Hertzler, Brandi Janssen, Allen Johnson, Ann Kingsolver, Theresa May,
Mark Moberg, Arthur Murphy, Tad Mutersbaugh, Tomomi Naka, Robert
Netting, Christine Padoch, Charles Peters, Miguel Pinedo-Vásquez,
Beverly Poduska, Silvia Purata, Martha Rees, Cerisa Reynolds, Tana Silva,
Christine Szuter, Amy Todd, Stephen Tulley, Victor Vásquez, Lois Was-
serspring, Ronald Waterbury, and Jim Weil.
While writing this book, I did much of my background reading and
editing in the coffee shop of Prairie Lights Bookstore in Iowa City. This
comfortable space is a wonderful refuge from economic downturns, mid-
western floods, and university politics.
Chapter 5 is a substantially revised and expanded version of a previous
publication: Experimental Economics in Anthropology: A Critical As-
sessment. American Ethnologist 32 (2) [2005]: 198–209.
Introduction
Three decades ago Gary Becker wrote a book in which he made extraor-
dinary claims about the usefulness of economic approaches for the under-
standing of questions in social sciences. In a now-famous introductory
essay to The Economic Approach to Human Behavior (1976), Becker suc-
cinctly states his views:
I have come to the position that the economic approach is a compre-

hensive one that is applicable to all human behavior, be it behavior in-
volving money prices or imputed shadow prices, repeated or infrequent
decisions, large or minor decisions, emotional or mechanical ends, rich
or poor persons, men or women, adults or children, brilliant or stupid
persons, patients or therapists, businessmen or politicians, teachers or
students. (8)
By “the economic approach” Becker means one in which “all human

behavior can be viewed as involving participants who maximize their
utility from a stable set of preferences and accumulate an optimal amount
of information and other inputs in a variety of markets” (14). He asserts
that his approach provides a “unified framework for human behavior”
that was sought by but eluded such renowned thinkers as Jeremy Ben-
tham, Auguste Comte, and Karl Marx.
In modified form, the types of analysis advocated by Becker have be-
come increasingly influential in the social sciences. In this book I examine
the advantages and disadvantages of this “economic” approach to diverse
practical problems involving decision making. I contrast this approach
with “anthropological” analyses that focus on the historical changes, cul-
tural norms, and socioeconomic institutions that constrain the choices
2 Anthropology, Economics, and Choice
possible for different groups of people at particular places and times. My

principal argument is that the methods of economics alone are insufficient
for understanding the complexities of choice.
Economic and Anthropological Approaches to Choice
Becker’s book, filled with graphs and equations, was written primarily for
economists. His definition of an “economic approach” would be likely to
mystify noneconomists unsure about the technical meanings of “utility,”
“preferences,” “inputs,” and “markets.” Even readers familiar with the
language of economics might wonder how anyone could possibly know
when utility is being maximized, what it means to say that preferences are
“stable,” and what exactly is an “optimal” amount of information.
In 1992 Becker won the Nobel Memorial Prize in Economic Sciences
“for having extended the domain of microeconomic analysis to a wide
range of human behaviour and interaction, including nonmarket be-
haviour.”1 As Becker hoped, economic approaches have become promi-
nent in fields such as political science and are now also of some impor-
tance in sociology, geography, and history. Such approaches are often
lumped together under the term “rational choice theory,” a reference to
their assumptions about utility maximization. An enormous scholarly
literature (among others, Elster 1989, Gigerenzer 2008, Parsons 2005,
Schweers Cook and Levi 1990) describes rational choice theory and de-
bates its merits. There are also numerous books aimed at general readers
that popularize the basic ideas of the theory. Some of these books (for
example, Becker and Becker 1997; Harford 2005, 2008; Levitt and Dub-
ner 2005) describe insights gained from applications of rational choice
theory; others (including Gladwell 2005, Groopman 2007, Lehrer 2009,
Thaler and Sunstein 2008) pay more attention to the theory’s limitations.
Many of the critics of economic approaches in social sciences emphasize
findings from experiments in cognitive psychology that show that people
often make suboptimal choices.
Rational choice theories have certain features that make them attrac-
tive to scholars advocating “scientific” approaches to social phenomena.
Their focus on a restricted number of key variables can allow hypothe-
ses to be tested in controlled situations. The mathematical elaboration
of these theories provides clear statements of suggested relationships
among different variables. Many ethnographically oriented anthropolo-
gists, however, are repelled by the very features that make rational choice
Introduction 3
theories appealing to many economists and political scientists and in-

triguing—if debatable—for many psychologists. The reliance of ratio-
nal choice theories on a limited number of assumptions is diametrically
opposed to an entrenched holistic anthropological tradition that stresses
multiple interrelated influences on cultural practices. The underlying idea
that humans everywhere have similar motivations conflicts with anthro-
pologists’ longtime emphasis on cultural diversity. The methodological
individualism typical of most applications of rational choice theory is un-
acceptable to both anthropologists focusing on supra-individual charac-
teristics of groups and institutions and those whose research examines
how history and political economy influence cultural practices.
The treatment of “preferences” in rational choice theory illustrates why
so many anthropologists are uncomfortable with economic approaches.
For economists, “preferences” refer to individual (or group) rankings of
the desirability of different outcomes. For example, an individual might
prefer apples to oranges or spending money on a swimming pool rather
than making a charitable donation. Such preferences are ordinarily as-
sumed to be “given,” meaning that the analyst is unconcerned about why
individuals have them. Becker, as usual, takes an extreme position:
Since economists have little to contribute . . . to the understanding of

how preferences are formed, preferences are assumed not to change sub-
stantially over time, nor to be very different between wealthy or poor
persons, or even between persons in different societies and cultures.
(1976b:5)
Almost any anthropologist would be appalled by Becker’s casual assump-

tion of cultural uniformity over space and time. I would not argue that all
economists share Becker’s explicit disinterest in cultural variability and
change. But it is clear that most have little professional interest in cultural
differences. The description and explanation of such differences, in con-
trast, are at the heart of most ethnographic work.
Approaches consistent with rational choice theory nonetheless have
been influential within varied subfields of anthropology. Anthropologists
adopting ideas from evolutionary psychology (such as Bliege Bird and
Smith 2005) have argued that diverse aspects of cultural behavior are the
result of humans attempting—not necessarily consciously—to maximize
their genetic contributions to future generations. Ecological anthro-
pologists studying hunter-gatherers (Winterhalder 1987 and others) use
the economistic optimal foraging theory in their efforts to explain food-
getting patterns. Demographic anthropologists (such as Nag, White, and

Peet 1978) have attributed increases and decreases in fertility patterns to
changes in the economic value of child labor.
Rational choice theory might be expected to be especially appealing
to anthropologists whose research focuses on the economy. Economic
anthropologists, however, have had an uneasy relationship with main-
stream economists. This discomfort can be traced in part to the areas
where anthropologists have historically done fieldwork. In the first part
of the twentieth century, most ethnographic research took place in set-
tings quite different from those usually studied by economists. In many
anthropologists’ research sites, goods and services were exchanged pri-
marily via kin networks. Anthropologists working with members of tribal
societies in the deserts of Africa, the islands of the Pacific, and the for-
ests of Amazonia were understandably skeptical about the general appli-
cability of theories designed to explain decision making in the economic
institutions of states.
During the 1950s and 1960s theoretical discussions in economic an-
thropology were therefore dominated by what came to be called the
formalist-substantivist debate. These impassioned arguments focused on
the relevance of economic theories and models in societies where mar-
kets were either absent or of limited importance. The formalists (Burl-
ing 1962, Cook 1966, LeClair 1962, to name a few) argued that eco-
nomic theory was directly applicable to such places. Their empirical work
stressed methodological individualism, made extensive use of quantitative
methods, and treated culture primarily as an unanalyzed shaper of prefer-
ences. Inspired by the writings of Karl Polanyi (1944, 1957), the substan-
tivists (including Dalton 1961, Sahlins 1972) dismissed the relevance of
western economic theory, emphasized institutions rather than individu-
als, and provided ethnographic descriptions of exchange systems such as
reciprocity, redistribution, and markets.
By the 1980s most economic anthropologists regarded the formalist-
substantivist debate as a dead end.2 Furthermore, the vast majority of an-
thropologists were by this time conducting research in societies where
markets are important. Nonetheless, there remained a clear divide within
economic anthropology between those advocating the use of formal
models based on utilitarian assumptions and those emphasizing the im-
portance of history and culture. Model-oriented economic anthropolo-
gists examined topics such as demographic influences on household labor
allocation (Durrenberger 1984), the effects of risk aversion on decision
making (Cancian 1979), and competition over the use of commonly held
Introduction 5
resources (McCay and Acheson 1987). Such research differed greatly

from the many historical studies in the 1970s and 1980s influenced by
dependency and world systems theories (for example, Mintz 1985, Rose-
berry 1983) that examined international trade, inequalities between the
rich and poor nations, and the socioeconomic relations associated with
commodity chains. Such historically and politically oriented research is
today ordinarily framed in the context of globalization. Studies of con-
sumption also have become prominent in economic anthropology (among
them Howes 1996, Miller 1998, Orlove 1997, Rutz and Orlove 1989); these
often incorporate ideas from cultural studies and postmodernism.
Despite this divide, even model-oriented contemporary economic an-
thropologists do not ordinarily uncritically accept mainstream economic
theory. They often argue that such theories need to be modified to be ap-
plicable to many situations in both western and nonwestern settings. The
great majority of economic anthropologists—whatever their theoretical
position—distance themselves from conventional economic theory.
The Value of Ethnography
My research in Belize, Peru, Mexico, and the United States over the past
several decades has focused on the work lives and economic strategies
of individuals and households. In my efforts to figure out how and why
people in these diverse places make decisions about their livelihoods I
have read many models of human behavior consistent with rational choice
theory that have been proposed by economists, anthropologists, cogni-
tive psychologists, and evolutionary biologists. These models employ
to greater or lesser degrees the economic approach advocated by Gary
Becker. Although these models have sometimes helped my understanding
of practical issues, I found that they were more often of little use because
of their intentional lack of attention to relevant ethnography, history, and
political economies. In their efforts to explain everything, they explained
very little.
The case studies in this book are intended to show the practical rele-
vance of what can seem to be arcane intellectual debates. They show that
the issues examined are not abstruse theoretical conundrums of interest
only to scholars; instead, they are essential to our understanding of how
and why people around the world make important decisions about their
livelihoods and the welfare of their families. The details in the ethno-
graphic examples illustrate what rational choice models leave out.
Making Choices
Economic approaches to decision making have been criticized on both

practical and theoretical grounds. Many scholars argue that the expected
utility framework underlying such approaches is difficult to apply to real-
world situations. Some go further and question the reasoning behind
utilitarian explanations of cultural practices.
Expected Utility and Rational Choice
Most contemporary versions of rational choice theories are based on

something called “expected utility.” This theoretical approach assumes
that decision makers are able to make approximations of the expected
utilities (payoffs) associated with alternative choices. The idea is that de-
cision makers select the option that provides the greatest expected utility.
Writers about expected utility (and more generally rational choice) differ
as to whether they consider their theories to be prescriptive or predictive.
Those taking a prescriptive approach say that while their methods tell us
what decision makers should do, no claims are made that people actu-
ally make optimal choices. Those taking a predictive approach argue that
much human behavior can be explained by looking at the extent to which
various choices maximize decision makers’ expected utility (self-interest).
There are several obvious problems associated with attempts to apply
an expected utility framework—whether prescriptive or predictive—to
on-the-ground decision making. The most important of these difficulties
are the following:
1. Expected utility theory assumes that decision makers can assign values
(utilities) to alternative outcomes of decisions. “Utility,” however,
is a murky concept that is almost impossible to define and measure.
Although economists often examine monetary returns to alternative
choices, people’s decision making is often influenced by other goals
such happiness, leisure, and risk avoidance. Some goals such as “hap-
piness” can be difficult to measure. Even when outcomes can be quan-
tified, there may be no obvious way to combine the different kinds of
payoffs from a particular outcome into a single measure of “utility.”
How can, for example, the happiness one gets from winning an ath-
letic competition be compared to the monetary rewards from such a
championship? 3
2. Expected utility models of decision making depend in part on deci-
Introduction 7
sion makers’ views about the probabilities of alternative outcomes

when particular choices are made. In many decision-making situa-
tions (such as the chances that a new restaurant will be successful),
these probabilities are difficult or impossible to estimate. Even when
such probabilities can be guessed reasonably well from past experi-
ences (weather records) or statistical theory (state lotteries), decision
makers’ estimates of the chances of possible outcomes may not be
realistic.
3. Estimates of expected outcomes (payoffs) from particular choices
must specify what length of time is being considered. Decision
makers, however, may have hazy ideas about time frames. This can
cause analytic problems when the short-term and long-term conse-
quences of a decision differ. The potential long-term consequences
of a decision often differ from those in the short term. Smokers, for
example, must weigh the immediate pleasures of a cigarette against
their increased chances of getting lung cancer some day. Their de-
cisions about whether to smoke depends on whether the time frame
being considered is the next five minutes or the next twenty years.
The “rational” decision might well be to smoke if only the next few
minutes are considered and to abstain if the next two decades seem
relevant.
4. Expected utility models assume that there are no problems in speci-
fying which individual or group is making a particular decision. Al-
though such models usually assume that choices are made by an indi-
vidual, they sometimes examine decisions made by groups such as
families, corporations, labor unions, and political parties. In many
situations, however, decision-making units are hard to isolate. Deci-
sions that may seem to be made by individuals are often influenced by
the ideas and concerns of many people.
Broader Meanings of Rationality
Many books and articles about “rationality” discuss utilitarian expla-

nations of cultural practices that assume that people are consciously at-
tempting to achieve measurable goals. A brief look at the polemical writ-
ings of an advocate and a critic of such explanations shows well how
debates over the usefulness of the concept of “rationality” reflect funda-
mental disagreements about the causes of human behavior. The advocate
is Tim Harford, an economist whose books (2005, 2008) aim at making
the often-abstruse ideas of his discipline comprehensible for general
readers. The critic is the famous anthropologist Marshall Sahlins, a long-

time outspoken opponent of economic and ecological explanations of
cultural patterns.
In his book The Logic of Life: The Rational Economics of an Irrational
World (2008:9), Harford describes his perspective on decision making:
Rational people respond to incentives: When it becomes more costly

to do something, they will tend to do it less; when it becomes easier,
cheaper, or more beneficial, they will tend to do it more. In weighing
their choices, they will bear in mind the overall constraints upon them;
not just the costs and benefits of a particular choice, but their total bud-
get. And they will also consider the future consequences of present
choices.
Harford’s comments are deliberately consistent with the expected

utility approach to decision making. Notice, however, the imprecision
of words such as “cheap,” “easy,” “future,” and “beneficial.” This is in
part because Harford is trying to make complicated ideas accessible for
readers who may understandably lack the patience to decipher techni-
cal definitions of utility and the ability to calculate probability-based ex-
pected outcomes. But Harford’s use of ordinary language also makes it
easy for him to loosely interpret diverse types of behavior as being “ratio-
nal.” He is not attempting to rigorously test hypotheses.
Some years ago Sahlins wrote a book in which he harshly criticized nu-
merous noted anthropologists for their utilitarian explanations of cultural
phenomena. In Culture and Practical Reason (1976), Sahlins argues—in lan-
guage less accessible than Harford’s straightforward prose—that such ex-
planations constitute “an epistemology for elimination of culture itself as
the proper anthropological object” (83). He goes on to say:
Without distinctive properties in its own right, culture has no title to

analysis as a thing-in-itself. Its study degenerates into one or another
commonplace naturalisms: the economism of the rationalizing individual
(human nature), or the ecologism of selective advantage (external na-
ture). (Ibid.)
Sahlins here is not explicitly criticizing expected utility approaches to

rational choice. He is instead generally arguing against what he regards as
reductionist explanations of cultural practices that emphasize their use-
fulness to either individuals or groups. Sahlins is hardly alone in making
Introduction 9
such critiques (Douglas and Wildavsky 1982, Lupton 1999, and others do
as well); the influential postmodern movement in anthropology during
the latter part of the twentieth century was based in part on a related re-
jection of attempts to make anthropology a social science seeking lawful
regularities in human behavior.
Although much of this book consists of my criticisms of what I see as
the limitations of economic models, I want to be clear than I am not advo-
cating culturalist analyses. My discussions of the shortcomings of ratio-
nal choice approaches to particular issues in economic anthropology are
not intended to be read as rejections of utilitarian explanations of human
behavior. I actually think that anthropologists should whenever possible
seek such explanations. I agree more with Harford than with Sahlins.
Migration from Mexico to the United States
The problems associated with attempts to apply economic models to real-

world situations can be seen by examining closely the decisions that two
brothers made about migrating temporarily from Mexico to the United
States. Rational choice theory provides an incomplete and in some ways
inadequate framework for understanding why the brothers made differ-
ent choices.
In 2003 Jorge and Oscar Morales began to think seriously about leaving
their community near the city of Oaxaca in southern Mexico and mi-
grating temporarily to California.4 The two brothers, both married and in
their late twenties, were the youngest of seven children in a hard-working
artisan family. Their village of a thousand people had prospered in the
1990s by selling brightly painted wood carvings to tourists and dealers
in folk art. Jorge and his wife, Sandra, had three young children; Oscar’s
wife, Veronica, had just given birth to their second daughter. The two
brothers and their families lived in a large compound with Alberto and
Alicia, the parents of Jorge and Oscar. Alberto and Alicia sold masks and
jewelry that they made at Monte Albán, a nearby archaeological site.
Oscar, three years older than Jorge, was one of the most highly edu-
cated artisans in Oaxaca. He excelled in his studies, obtaining a degree in
business administration from a local university. For several years Oscar
earned a good living by local standards by working as an intermediary for
Roger, a large-scale dealer in folk art from Arizona. Roger sent orders to
Oscar for particular types of carvings. Oscar arranged with local artisans
to make the pieces, which he later collected, packed, and sent to Arizona.
Oscar was a decent carver and painter, but his pieces are unremarkable in
a place where there are many talented artisans. He stood out instead for
his business skills and reliability. Oscar was one of the most respected men
in his community. By 2003 he had already served as the (unpaid) treasurer
and secretary in the local government.
Although Jorge was a better-than-average student, he enjoyed his
studies less than Oscar did and left school after attending prepa (the
equivalent of a U.S. high school) for a few years. Jorge had little interest
in marketing crafts and did not join Oscar and another brother in their
work for Roger. He was, however, a talented artisan who specialized in
making meticulous small carvings of animals including goats, cats, and
giraffes. Sandra, a skilled painter, helped with the pieces but was limited
in what she could do because of child care responsibilities.
The demand for Oaxaca wood carvings began to decline around 2000.
Although sales of well-made, relatively expensive pieces remained good,
fewer tourists, shop owners, and wholesalers were buying the cheaper
carvings that comprised the bulk of the trade. In 2002 Roger decided to
stop selling Oaxacan wood carvings and to concentrate instead on other
Latin American crafts. Oscar lost his job with Roger and needed immedi-
ately to find other ways to support his family. Jorge’s income also de-
creased because of fewer sales of his pieces.
Like many other Mexicans their age, Jorge and Oscar knew that tem-
porary migration to the United States could provide income that could
support their families. Several of their older brothers regularly went back
and forth to California, where they seemed to have little trouble find-
ing work. Although these brothers migrated without legal documents and
worried about the difficult border crossing, they had been able to make
their trips without serious difficulties. If Jorge and Oscar went to Califor-
nia, they could stay with family members or friends already there and use
these connections to find steady if low-paid employment.
The advantages and disadvantages of such migration are well known
in both the United States and Mexico. The wages for unskilled work in
the United States are much higher than those for even most professional
jobs in Mexico. Because of this discrepancy in wages, remittances (money
sent home by migrants) are one of the major sources of income in Mexico.
Many migrants hope that they might be able to settle permanently in
the United States and make better lives for themselves and their families.
Some migrants—whether or not they see their border crossing as perma-
nent—also regard their journeys as exciting opportunities to see another
part of the world.
Introduction 11
Most migrants, however, are reluctant to leave Mexico. Crossing the

border without papers can be dangerous; even those who safely enter the
United States live in constant fear of being caught by immigration offi-
cials and being jailed or deported. Perhaps the most common reason that
people give for disliking migration is the loneliness of being separated
from loved ones. Even in an age when telephone and Internet commu-
nication is easy and inexpensive, being away from home can be painful
(Cohen 2004:7).
Oscar and Jorge reacted differently to the possibility of migrating. For
Oscar this was an alternative only to be pursued as a last resort. He was
devoted to his family and comfortable in his position in his community.
Oscar did what was expected by authorities; living illegally in the United
States would be especially uncomfortable for him. Furthermore, Oscar
was friendly with many folk art dealers, academics, and tourist agents in
both the United States and Mexico. These contacts, he thought, would
help him find new sources of income.
Although Jorge was not enthusiastic about leaving Oaxaca, he had fewer
reservations about migration than Oscar. Lacking Oscar’s education and
social networks, Jorge had fewer options if he remained in Mexico. Per-
haps also he was not as content as Oscar with his life in Oaxaca. Jorge had
never earned as much money as Oscar. While popular, Jorge did not have
the deep respect that Oscar had earned through his community service.
The decisions Oscar and Jorge made about migration were not entirely
independent. Both brothers thought it best if one remained in their com-
munity to help with their elderly parents, their children, and the mainte-
nance of the family compound. While such considerations would not pre-
vent both brothers from migrating if economically necessary, they clearly
influenced Oscar’s thinking. However, if one brother decided to migrate
and send remittances back home, this would help everyone living in the
compound.
In 2003 Jorge left for Los Angeles. Although he phoned his family most
days, as of 2010 Jorge had not returned to visit even once because of fears
about increased vigilance at the border. Jorge, who now speaks good En-
glish, works days at an insurance company and nights in a grocery store.
He shares living space with an ever-changing cast of relatives. Jorge has
done well economically compared to most Mexican migrants; his brothers
in Los Angeles, for example, work fewer hours at less well-paid and more
physically taxing jobs.
Through his connections with university professors (including me),
Oscar was able to legally visit the United States several times to give
wood-carving demonstrations and sell pieces. After making several such

trips, Oscar obtained a ten-year tourist visa that allows him to enter the
United States without problems. His trips to the United States, which
ordinarily include visits with Jorge and other relatives, last only a few
weeks. Oscar continues to serve in important political positions in his
community.
In recent years Oscar has not done as well economically as he had hoped
after losing his job with Roger. He has supported his family by making
and selling wood carvings, teaching computer skills to local children, and
working occasionally for visiting scholars. Wood-carving sales in Oscar’s
community fell sharply between 2006 and 2008 because political prob-
lems in Oaxaca resulted in fewer tourists visiting the state. In reaction to
these economic problems, Oscar founded an artisans organization that
promotes the cooperative marketing of wood carvings. Although the or-
ganization has had some success and tourism in Oaxaca is rebounding,
Oscar and many of his neighbors can no longer rely on wood carving as a
good source of income.
There is no question that Oscar could have earned more money over
the past several years if he had chosen to migrate. But he is content with
his life in Mexico and almost certainly would be less happy in Los Ange-
les away from his family.
When Is Migration “Rational”?
The applicability of rational choice models has been questioned (Gladwell

2005, for example) for the many situations in which people make decisions
without consciously and systematically weighing the costs and benefits
of alternative actions. The choices Jorge, Oscar, and other Mexicans face
about migration, however, involve a careful consideration of the pros and
cons of leaving home. Migration is a perennial topic of conversation in
Mexican communities; families may discuss for years whether particular
members should migrate. Jorge and Oscar’s decision-making processes
nevertheless illustrate the limitations of rational choice approaches. Al-
though these approaches can help us understand the reasons for variations
in the choices made by members of different socioeconomic groups, their
intentional downplaying of ethnographic detail leads to thin, unsatisfy-
ing analyses.
The basic idea underlying rational choice models is that individuals
will pursue actions that are in their self-interest. In the case of Mexican
Introduction 13
migration, this suggests that individuals who would benefit most from mi-
gration are more likely to go to the United States than those who would
benefit less. While this appears to be a truism of no explanatory value,
rational choice approaches have led researchers to specify the socio-
economic conditions in Mexico and the United States that lead certain
groups to be more likely to migrate than others. Much research on this
topic (such as Massey, Goldring, and Duran 1994) has therefore consisted
of useful examinations of statistical correlations between migration rates
and membership in particular demographic and economic groups. Such
studies have helped us understand, for example, why most migrants from
Oaxaca to the United States are young men. An examination of the mi-
gration decisions made by Jorge and Oscar shows what is left out of such
analyses. Using an economic model to determine which choices were in
their self-interest is difficult to do because of the slipperiness of the con-
cept of “utility,” the unpredictable outcomes of different decisions, the
differences between short-term and long-term consequences of actions,
and the fuzzy nature of decision-making units.
The Uselessness of “Utility”
There are two main reasons Jorge and Oscar made different decisions
about migration. First, Oscar had job skills and social connections that
might be more useful in Oaxaca. Second, the brothers placed different
emphases on the relative importance of the economic and personal con-
sequences of migration for themselves and their families. A researcher
focusing on rational choice might attempt to measure the differences
in local job opportunities, but such an approach would be of no help in
understanding the different weights that Jorge and Oscar placed on eco-
nomic and psychological considerations. An advocate of rational choice
could only make the meaningless observation that Oscar placed higher
“utility” than Jorge on the psychological well-being of himself and his
family. Although from this perspective both brothers acted “rationally,”
the concept of “utility” does not aid our understanding of how their
psychological make-up influenced their choices.
Unpredictable Consequences
When Jorge and Oscar discussed going to the United States, they had
some idea of what their lives would be like in California. Still, they did
not know what kinds of work they would find, whether they would have
trouble with the border patrol, and how happy or unhappy they would be
away from their community. They could make only vague guesses about
what their economic and personal situations would be like over the next
several years if they stayed in Mexico. Their migration decisions there-
fore only partly fit expected utility theory assumptions about the ability
of decision makers to specify the probability of alternative outcomes to
their choices.
Short Term versus Long Term
When Jorge and Oscar contemplated migration, they were unsure about
a time period on which to base their decision. Migration might be short-
term if large amounts of money were earned and economic conditions
in Oaxaca improved. If the economic situation in Oaxaca worsened (as
turned out to be the case), migrants might spend a long time—perhaps
even the rest of their lives—in the United States.
Who Makes Choices?
Studies of migration ordinarily implicitly or explicitly assume that deci-

sions are made autonomously by individuals like Jorge and Oscar. This
is not always so. Jorge and Oscar, like many other potential migrants,
often talked with various members of their families about the possibility
of leaving. Jorge might not have left without knowing that Oscar would
probably stay; Oscar might not have stayed without knowing that Jorge
was leaving. The views of the wives, parents, and siblings of Jorge and
Oscar also influenced their decisions.
Ethnography and Rational Choice Models
Economists, political scientists, and sociologists taking rational choice

approaches to migration use statistical analyses to compare the relative
importance of a small number of key variables thought to influence deci-
sions to stay or leave. While such analyses have provided valuable infor-
mation about migration patterns, they can be of limited help in under-
standing particular choices made by individuals. I question the extent to
which Jorge’s and Oscar’s decisions can be analyzed without examining
the details of their lives, local family structures, and economic and politi-
cal developments in the state of Oaxaca.
Introduction 15
Economic Theory, Rational Choice, and the Financial Crisis
The recent worldwide financial crisis has led economists to pay more at-
tention to critiques of strict versions of rational choice theory (Cassidy
2009 and Fox 2009 provide good popular overviews). Consumers, inves-
tors, bank officials, and policy makers made decisions during the past de-
cade that in retrospect were “irrational” in their underestimation of the
possibility of disastrous outcomes. Their choices seemed inconsistent with
ideas such as the rational expectations hypothesis, part of an influential
theoretical framework proposed by the economists Robert Lucas (1987)
and John Muth (1961). John Cassidy nicely summarizes this framework:
Lucas . . . [assumes] that everyone knows exactly how the economy

works. People aren’t merely aware that unemployment is somehow linked
to inflation, which is linked to interest rates; they all have the same (cor-
rect) mathematical model of the economy in their heads, which they use
to form expectations of wages, prices, and other variables. . . . By in-
voking the rational expectation hypothesis, Lucas could simply write
down some equations to describe how workers, firms, and the govern-
ment behave, put a mathematical expectation operation in front of them,
and derive a solution that was consistent with the decision rules of every-
body in the economy. (2009:99–100)
It would be foolish to argue—as anthropologists sometimes do—that

until recently almost all economists shared the worldviews of Lucas and
Muth. Prominent economists like John Maynard Keynes (1937), Francis
Bator (1958), and Richard Thaler (1988) have long questioned the as-
sumption that economic decision makers with complete knowledge of
the possible outcomes of alternative actions consciously calculate utili-
ties when making choices. In subsequent chapters I discuss in detail some
recent and not-so-recent critiques of this assumption. In order to give
readers a feeling for the flavor of these critiques, I briefly present here
three ideas offered by economists who question strict versions of rational
choice theory.
The “herd mentality” (Scharfstein and Stein 1990) refers to the ten-
dency of economic decision makers such as investors to imitate the often
risky choices of others even when their own inclinations and calculations
suggest that they should do otherwise. Imitation occurs not only because
individuals going along with the crowd doubt their own judgment or fear
being mocked for nonconformist behavior. In certain respects it makes

economic sense to conform even when doing so appears to be “irrational.”
When individuals go along with the crowd and things turn out badly, the
blame is shared by everybody. If individuals differ from the crowd, they
bear sole responsibility when things go wrong. Conservative investors
working for banks or Wall Street firms during the heights of the dot-com
boom of the late 1990s and the housing bubble of the past decade would
have lost substantial bonuses and perhaps their jobs if they declined to fol-
low their peers in making risky allocations of money into Silicon Valley
startups and subprime derivatives.
Behavioral economics consists of attempts to apply findings from labo-
ratory experiments to economic decision making in the outside world.
Most behavioral economists (including Thaler 1988) have been strongly
influenced by research carried out in the 1970s and 1980s by the psycholo-
gists Daniel Kahneman and Amos Tversky. Kahneman and Tversky dem-
onstrated in a series of ingenious experiments (1982a) that most people
in laboratory settings in western societies are unable to make the cal-
culations required by strict versions of rational choice theory. Instead,
they rely on rules of thumb and unsubstantiated beliefs that enable them
to make complex decisions quickly. Researchers in behavioral finance
have used the ideas of Kahneman and Tversky in their explanations of
trend following, speculative bubbles, and poor corporate decision making
(Cassidy 2009:198).
Scholars focusing on asymmetric information directly challenge the
assumption of rational choice theory that all participants in economic
transactions are well informed about the possible consequences of alter-
native actions. They point out that in many transactions, not all partici-
pants have equal access to relevant information. In a classic paper, George
Akerlof (1970) gave the example of the market for used cars. Sellers are
ordinarily more familiar than buyers with the condition of cars for sale.
A buyer, knowing this, often distrusts the claims of a seller about a car’s
condition and fears being saddled with a lemon. One result is to depress
the price of cars that are actually in good shape. Akerlof makes the less
obvious argument that another consequence would be that some sellers of
good cars would take their vehicles off the market, leading to an increased
proportion of lemons for sale. In the past decade, economists have used
ideas about asymmetric information in their analyses of problems in the
financial sector and the health care industry (Cassidy 2009:156–163).
These economists criticizing rational choice theory have cogently de-
scribed the empirical difficulties associated with assumptions about om-
Introduction 17
niscient, calculating decision makers. Their often sensible policy rec-

ommendations (as in Thaler and Sunstein 2008) usually involve urging
institutions to adopt incentives that will lead fallible decision makers to
make choices that are more likely to help both themselves and society as a
whole. Although I find the work of these critics provocative and insight-
ful, their analytic approaches nonetheless differ from those of most eco-
nomic anthropologists. Like other economists, these critics rely heavily
on mathematical models using only a few variables, assume that decisions
are made by either individuals or groups acting as a unit, deemphasize
history and ethnography, and separate “economy” and “society” in their
analyses. Their examples are almost entirely confined to the decision-
making situations and institutions that conventional economic theory
was designed to explain. They rarely attempt to apply their ideas—some
of which seem relevant—to the kinds of choices that ethnographers typi-
cally examine in their fieldwork in western and nonwestern settings alike.
Some economists are truly heterodox in the attention they pay to
history and ethnography and their deemphasis of individual decision
making. Many such economists are influenced by feminist or Marxist
theory. These radical critics of conventional economics are a small and
uninfluential minority in academic and policy circles in the United States
and many other countries. The generalizations I sometimes make in this
book about economists are not meant to apply to these scholars.5
Issues in the Analysis of Choice
The fundamental assumption of mainstream economics is that careful

analyses of decision making help us understand human behavior in di-
verse situations. Because this assumption is not self-evident, the first
chapter looks carefully at critiques of studies focusing on choice. Al-
though these critiques highlight certain weaknesses of economic theory,
I conclude that decision making is an important aspect of cultural adap-
tation and change.
The five chapters that follow examine knotty problems in the analy-
sis of decision making. The first of these, chapter 2, considers attempts
to calculate monetary values for unpaid labor and production for home
consumption. Such calculations are aimed at improving our knowledge of
how people make choices between such work and paid labor. Economic
analyses of these decisions entail comparisons of the “utility” of paid and
unpaid work. Although there are formidable theoretical and practical
problems associated with such comparisons and calculations, I conclude

that they are necessary for an understanding of many important choices.
Chapter 3 compares approaches taken by economists, cognitive psy-
chologists, and anthropologists in their analyses of decision making in
situations of risk and uncertainty. These scholars differ greatly in the ex-
tent to which they accept the expected utility assumption that decision
makers estimate the probabilities of different outcomes to alternative
choices. I argue that this assumption—a fundamental part of strict ver-
sions of rational choice theory—is almost always unrealistic. Cognitive
psychologists agree, showing in laboratory experiments that participants
are often unfamiliar with basic concepts of probability. While I do not
dispute these findings, my critique is different from that of the psycholo-
gists. I question the extent to which the results of their experiments can be
extrapolated to real-world decision making. In my view, there is no substi-
tute for ethnographically rich descriptions of the complexities of decision
making in particular risky and uncertain situations.
Chapter 4 takes a critical look at economic experiments in anthro-
pology. In one of the stranger episodes in the history of economic anthro-
pology, in the late 1990s and early 2000s widespread publicity and signifi-
cant funding were given to experienced ethnographers running carefully
designed experiments in their field sites in nonwestern settings. The pur-
pose of these experiments was to test the cross-cultural validity of ideas
from evolutionary biology and economics about decisions related to co-
operation. The experimenters made the ambitious claim that their results
provided important insights about the “nature of human nature.” Again,
the relevance of experiments in quasi-laboratories to real-life decision
making can be questioned. This chapter, more than any of the others,
illustrates the dangers of making simplistic assumptions about the moti-
vations for human behavior.
The next two chapters examine situations in which it is difficult to
determine whether individuals or groups are making decisions. Chapter 5
examines definitional problems associated with the concept of “house-
holds.” Economists and anthropologists sometimes treat households as
decision-making units. National censuses often provide information at
the household level, implicitly assuming that this is a more or less obvious
socioeconomic unit. As ethnographers have observed, in many places it
is impossible to neatly delineate a group of people as a “household” that
shares resources and makes choices together. I nonetheless argue that the
advantages of collecting and analyzing data at the household level out-
weigh the disadvantages brought about by this particular simplification.
Introduction 19
Chapter 6 discusses influential theories about what has been called

“the tragedy of the commons.” According to these theories, communal
resources are frequently destroyed by individuals pursuing their self-
interests. Ethnographers have shown that such theories do not always
accurately depict decision-making situations. In many situations there are
cultural rules and social institutions that prevent the untrammeled exploi-
tation of publicly held resources.
The conclusion summarizes the major differences in the ways anthro-
pologists and economists study choice. I conclude that the mathemati-
cal models of economists must be complemented by more descriptive,
empirical approaches that consider the context within which choices are
made.
CHAPTER 1
How Important Is Decision Making?
[T]he difference between economics and sociology is very simple. Economics is

all about how people make choices. Sociology is why they don’t have any choices
to make.
DueSenberry 1960:233
A theory of how people make their economic choices is without interest and
probably impossible until we have tackled the prior questions of the factors
determining what choices are available to them.
White 1976:36
When I went to Belize in the fall of 1971 to conduct research for my

doctoral dissertation, my overall goal was simple enough. I wanted to
learn how rural residents of three communities made decisions about how
much time to spend over the course of a year on alternative ways of pro-
ducing food and earning income. This turned out to be a difficult task,
involving careful analyses of the costs, benefits, and risks associated with
different ways of earning a living. For the most part, I avoided thinking
too much about why these costs, benefits, and risks were what they were.
Explanations, for example, for the poor road system and low price of corn
seemed beyond the scope of my research. I was having enough trouble
collecting basic information on the yield of different crops, the composi-
tion of households, and the techniques involved in catching fish.
While I was writing up my thesis, I sometimes questioned the value
of what I was doing. Many of the so-called choices I was analyzing were
greatly affected by historical, political, and macroeconomic forces that
rural Belizeans could not control. Perhaps my research—while not use-
less—was relatively unimportant. Maybe I should have spent more time
learning about the history and political economy of Belize.
How Important Is Decision Making? 21
I was not alone in worrying about such issues. The question of the ex-
planatory power of studies of decision making is related to two classic
debates in social science. The first concerns the relative importance of
fine-grained local studies and wider-ranging examinations of regional,
national, and international economics and politics. The second is about
the usefulness of methodological individualism as opposed to the analysis
of cultural norms and supra-individual social institutions. I cannot pre-
tend here to be able to resolve these debates. My goal is the more modest
one of contrasting the ways in which economists and anthropologists deal
with the limitations of decision-making studies.
Economists usually regard most constraints on decision making as
“givens” beyond the scope of their analyses. They often, however, ana-
lyze how incentives offered by different macroeconomic policies affect
the choices that people make. Economic anthropologists take several ap-
proaches to decision making. Some attempt careful formalist analyses of
how people make choices in particular times and places. Others adopt the
substantivist position that economic choices are limited because they are
embedded in social institutions. Most emphasize how local decisions must
be understood in the context of wider historical, economic, and politi-
cal circumstances. Although many practicing economic anthropologists
combine these approaches, they differ in which ones they emphasize.
Before contrasting the approaches of economists and anthropologists
to the limitations of decision-making studies, I look at the Belize case in
more detail. Pragmatic examinations of particular cases, I think, provide
insights about general issues that are obscured in programmatic theoreti-
cal proclamations.
How Much Choice Did Rural Belizeans Really Have?
Much of my research for my doctoral dissertation consisted of attempts

to understand decisions that rural Belizeans in the early 1970s made about
how to allocate their work time between cash crops and wage labor. I
began by asking people to tell me what they thought were the advantages
and disadvantages of these two ways of earning income. Using what they
told me as a starting point, my analyses included calculations of mone-
tary returns per unit of time for different types of cash cropping and
wage labor, estimates of the risks and uncertainties associated with vari-
ous ways of earning a living, and creations of models of labor alloca-
tion that appeared to maximize cash income over the course of a year.
I also described how individuals’ ability to participate in different types
of income-producing activities was affected by their particular circum-

stances. Farmers living near a road, for example, could market cash crops
more easily than those living in more remote places.
Although I was confident that my descriptions and analyses (Chibnik
1975, 1980) advanced our understanding of how and why these decisions
were made, there were times when I wondered about the value of such
detailed studies of choice. Did it really matter that I understood why Be-
lizean farmer X planted more rice than corn and rarely worked in wage
labor, while Belizean farmer Y planted no rice at all and instead did wage
labor, grew corn, and raised citrus crops? Was it not more significant that
both farmers X and Y were in a situation that no matter what they did, the
returns to labor were so low their families could hope for no more than a
modest standard of living?
Another way of looking at decision making by rural Belizeans in the
early 1970s in the area where I did research would be to emphasize the
constraints that limited their choices and affected the input/output ratios
associated with different ways of making a living. Such constraints were
ecological, technological, economic, and political. They included a poor
road system, a low population density, a small internal market for cash
crops, a complicated land tenure system, a newly instituted state Mar-
keting Board that guaranteed prices for certain agricultural products,
the increasing availability of international aid, the colony’s political re-
lationship with Britain, local soil systems, military threats to Belize from
Guatemala, the operations of foreign citrus companies, economic compe-
tition from Mennonites, the availability of agricultural advice from gov-
ernment officials, and the beginnings of what later became a flourishing
tourist industry. Although I discussed these matters in my publications at
some length, they were not the focus of my research.
My concerns about the limitations of ethnographic studies were shared
by many other sociocultural anthropologists in the 1970s. During this
period, scholars in diverse disciplines (for example, Gunder Frank 1969,
Wallerstein 1974) were advocating political economic studies that empha-
sized how economic conditions in “satellites” such as Belize were affected
by the activities of governments and firms in “metropoles” such as Brit-
ain and the United States. The central idea of this “dependency theory”
was simple: rich countries gained their wealth and power through unequal
economic relations with poor countries. Furthermore, within poor coun-
tries there were parallel exploitive relations between the rich and poor
and between urban centers and rural peripheries. Dependency theory has
been criticized for its neglect of the particularities of local and regional
histories and its unwillingness to grant agency to the activities of those

individuals and groups resisting the incursions of capitalist enterprises.
Nonetheless, there can be no question that the general ideas of depen-
dency theory help explain historical developments and economic condi-
tions in many parts of the world.
One long-ago day I was discussing these ideas with another graduate
student who was conducting research among farmers in rural France, a
place not usually thought of as prime territory for theories decrying the
effects of imperialism. My colleague announced that she was planning to
do research on political maneuvering on agricultural issues in the French
parliament. The decisions made there were the ones that really counted
in the lives of the French farmers with whom she worked. I was taken
aback. Why not also study the history of the French parliament, the in-
vention of the machines used in farming, the origins of the land tenure
system, and countless other topics that in some way affected the lives of
the people in the rural community where she was conducting research?
Surely, I thought, my colleague had to decide that certain matters were
outside the scope of her project.
Despite my skepticism, my colleague had raised an issue of fundamen-
tal importance, one that has continued to preoccupy anthropologists to
this day. Ethnographic fieldwork focusing on a single community has be-
come less common than multisited research. Almost all studies that do
focus on particular places now include detailed discussions of regional
histories, national politics, and economic interactions between local com-
munities and the outside world. The language in which these discussions
have been framed, however, has changed over time as dependency theory
has become less fashionable, giving way first to studies of resistance and
later to analyses of globalization emphasizing multidirectional flows of
goods and information.
As I wrote my dissertation I also considered the implications of the
ongoing formalist-substantivist debate for my study of decision making.
Without consciously taking sides in this contentious discussion, I had
been adopting a formalist approach emphasizing how “rational” decision
makers went about making choices. The substantivists argued that such an
approach was fundamentally mistaken because it ignored how economic
actions were often embedded in local social organization and culture. Al-
though I was not entirely sure what “embedded” meant, the general idea
was clear enough. The substantivists thought that economic choices in
many societies were constrained by social customs and institutions such as
kinship obligations and religious taboos. While the dependency theorists
emphasized how external institutions such as states and firms limited de-
cision making, the substantivists focused on internal sociocultural factors
that prevented people from having all that much choice.
The substantivist argument seemed of limited relevance to my research
in Belize. I was not working in a place with a long-standing cultural tradi-
tion and complex forms of indigenous social organization. The groups I
worked with—including the Mayas—were all descendants of people who
had either been brought to Belize as slaves or migrated there while the
colony was under British control. The only way that the substantivist
position seemed pertinent was in local patterns of marriage and residence.
Arguably as a result of economic conditions under colonialism, men in
two ethnic groups in the area—Creoles and Caribs (Garifuna)—often
remained in their parents’ homes well into adulthood while fathering and
supporting children with women living elsewhere, usually with their own
relatives. Maya men and women, in contrast, married young and estab-
lished their own households. These cultural differences clearly influenced
economic activities. But such differences affected the local economy much
less than, for example, low prices for cash crops, poor roads, and a small
internal market.
What Economists Intentionally Ignore
Three academics went off on a sailboat together, a physicist, a chemist, and an

economist. Unfortunately, they ran into a storm and the boat was wrecked on
an uninhabited island. The only food they were able to rescue from the wreckage
was a case of baked beans. As they got hungry, they began to wrestle with the
problem of how to open the bean cans. The physicist said, “I’ll climb a tree and
throw a can onto a rock and it’ll split open.” The others didn’t much like this
idea because they thought the beans would just splatter everywhere. The chemist
said, “We can soak the cans in salt water and they’ll rust through.” The others
didn’t much like this idea because it would take too long. Then the economist
said, “Hey—no problem, we’ll just assume a can opener.”
claSSic joke about economiStS
In 1995 Amartya Sen was invited in to give the Frisch Memorial Lecture
at the World Econometric Conference in Tokyo. Sen, who was awarded
the Nobel Prize in Economics a few years later, decided to talk about
“maximization and the act of choice.” As might be expected in a lecture
to this audience, much of the talk was phrased in the language of mathe-
matical models. The beginning of the lecture, however, included an acces-

sible discussion of two examples demonstrating the limitations of ratio-
nal choice analyses of decision making. I present these examples in some
detail because they clearly illustrate the differences between economic
approaches to choice and those in disciplines such as anthropology and
sociology.
The first of Sen’s examples is a trivial matter—the selection of a chair
at a garden party. Sen presents a situation in which someone is invited to a
party where one chair is obviously more comfortable than the others. The
guest nonetheless sits in a different chair. How, Sen asks, can such a choice
be reconciled with the rational behavior assumed in conventional eco-
nomic theory? Using the jargon of his discipline, Sen says that this might
happen because the guest’s “preference for choice behavior may well be
defined over ‘comprehensive outcomes,’ including choice processes (in
particular, who does the choosing) as well as the outcomes at culmination
(the distribution of chairs)” (1997:747). Fortunately for noneconomists,
Sen goes on to explain what he has in mind in somewhat more com-
prehensible language. He suggests four reasons the selection of a less-
preferred chair might make sense:
(i) Reputation and indirect effects: The person may expect to profit in the
future from having the reputation of being a generally considerate
person, and not a vigilant “chair-grabber.”
(ii) Social commitment and moral imperatives: She may not think it
morally “right” to grab the most comfortable chair, cutting others
out, and such “moral sentiments” could be explicitly followed or only
implicitly obeyed.
(iii) Direct welfare effects: The person’s well-being may be affected di-
rectly by the process of choice (for example, by what people think of
her—she may not enjoy the look she gets as she makes a dash for the
great chair) . . .
(iv) Conventional rule following: She may be simply following an estab-
lished rule of “proper behavior” (as the ongoing norm), rather
than being influenced by direct welfare effects, or even by any self-
conscious ethics. (747–748)
According to Sen, the first of these explanations is most in harmony with

the conventions of standard neoclassical economics. The other three
explanations are based on “forces” outside of conventional economic
explanations.
Sen’s other example, of more substantive weight, is the much-debated

paradox among economists about why people in democracies take the
time to vote (Boudon 1998, Overbye 1995). When the number of voters
is large, the ballot of any one individual has little chance of affecting the
outcome. From a narrow cost-benefit perspective, it appears that voters
would do better by staying away from the polls. Sen points out that the
act of voting may be important to a person because of the cultural signifi-
cance of political participation. Perhaps because such significance is diffi-
cult to measure, it is rarely incorporated into economic models of voting.
From an anthropological perspective, Sen’s need to make these ele-
mentary points in such a rarefied setting suggests that something basic
is missing from most economic analyses. Stripped of the jargon and the
mathematics, Sen’s main point seems to be that culture matters in deci-
sion making. He is not the first to have noticed this. In any case, Sen’s
remarks only begin to scratch the surface of the complexity of his ex-
amples. His comments ignore the historical and sociopolitical context of
the choices he describes. In order for decision makers to choose chairs
and pick candidates, they must be invited to garden parties and be per-
mitted to vote. On a broader lever, such choices would be nonexistent
without the historical development of the institutions of garden parties
and political elections. Economists, of course, know that much is miss-
ing from their analyses. But many economists do not regard these omis-
sions as a defect of their methods. As will be seen, they argue instead that
the creation of simplified models actually improves our understanding of
choice.
Microeconomics and Macroeconomics
The field of economics is conventionally divided into two subfields—

microeconomics and macroeconomics. Most of the discussions in this
book about the ideas and assumptions of economists focus on microeco-
nomics because that subfield is more directly concerned with decision-
making theories. Nonetheless, the typical assumptions of macro-
economists about the existence and cross- cultural relevance of certain
institutions of western market societies form the context within which
microeconomists make their analyses of choice.
Microeconomics is usually defined as the study of individual entities
such as firms or households. Most microeconomic analyses explicitly or
implicitly assume market-based societies where firms are producers and
households are consumers. Gregory Mankiw, for example, concisely de-

fines microeconomics as “the study of how households and firms make de-
cisions and how they interact in specific markets” (2005:27).
Macroeconomics examines either a national economy as a whole or
large subdivisions such as government, household, or business sectors.
The examples given in textbooks show how macroeconomic analyses
ordinarily assume the institutions of contemporary market societies:
Macroeconomics speaks of such economic measures as total output, total

income, aggregate expenditures, and the general level of prices. (McCon-
nell and Brue 2005:9)
Today, macroeconomists examine a wide variety of areas, such as how

total investment and consumption are determined, how central banks
manage money and interest rates, what causes international finan-
cial crises, and why some nations grow rapidly while others stagnate.
(Samuelson and Nordhaus 2005:5)
A macroeconomist might study the effects of borrowing by the federal

government, the changes over time in the economy’s rate of unemploy-
ment, or alternative policies to raise growth in national living standards.
(Mankiw 2005:27–28)
Economists recognize that microeconomics and macroeconomics are

related. Much of the aggregate data studied by macroeconomists is the
result of large numbers of decisions made by individuals, households, and
firms. Nonetheless, the two subfields are regarded as distinct and are often
taught in separate courses at universities.
Milton Friedman and Economists’ Use of Assumptions
Long ago the famous economist Milton Friedman wrote a book in

which he presented his views about the methodology of both microeco-
nomics and macroeconomics. Although these ideas have been derided as
a “simpleton’s version of positivism” (McCloskey 1998:xi), they continue
to represent the mainstream approach to theory and modeling in eco-
nomics. According to Friedman (1953:7) and many philosophers of sci-
ence—not all simpletons—theories and hypotheses aim at making valid
and meaningful predictions about phenomena not yet observed. They are
intended to abstract essential features of a complex reality. Such theories

and hypotheses are intentionally unrealistic:
Truly important and significant hypotheses will be found to have “as-

sumptions” that are wildly inaccurate descriptive representations of
reality, and, in general, the more significant the theory, the more unreal-
istic the assumption. . . . The reason is simple. A hypothesis is important
if it “explains” much by little, that is, if it abstracts the common and cru-
cial elements from the mass of complex and detailed circumstances sur-
rounding the phenomena to be explained and permits valid predictions
on the basis of them alone. To be important, therefore, a hypothesis must
be descriptively false in its assumptions; it takes account of, and accounts
for, none of the many other attendant circumstances, since its very suc-
cess shows them to be irrelevant for the phenomenon to be explained.
(Friedman 1953:14–15)
Friedman therefore argues against the position that theories can be as-
sessed by the realism of their assumptions (41). For Friedman, the only
test of a theory is whether it leads to hypotheses that yield accurate pre-
dictions. This view would seem to contrast in two striking ways with past
and present practices in economics. Although some economic theories
are notorious for their failure to predict real-world events, their adher-
ents often continue to espouse them. Furthermore, much of economics
consists of exploring the mathematical implications of different models
without much concern about how such models might be tested using em-
pirical data. What is of relevance here, however, is Friedman’s deliberate
lack of concern about realistic descriptions of choice and his implicit dis-
dain of holistic methods, such as those prized in anthropology and his-
tory, that emphasize complex interrelationships of culture, institutions,
and decisions.
The continuing dominance of Friedman’s way of thinking about eco-
nomics can be seen through an examination of the introductory sections
of three leading contemporary textbooks.1 Economics, Principles, Problems,
and Policies (McConnell and Brue 2005) is currently the best-selling text-
book in the field. Economics (Samuelson and Nordhaus 2005) is a recent
incarnation of what was the standard textbook in economics for decades.
Principles of Microeconomics (Mankiw 2005) is written by a Harvard pro-
fessor who runs a popular blog and was chair between 2003 and 2005 of
President Bush’s Council of Economic Advisers.
All three textbooks begin by emphasizing the centrality of decision

making to their field:
Economics is the study of how society manages its scarce resources. In

most societies, resources are allocated not by an all-powerful dictator,
but through the combined actions of millions of households and firms.
Economists therefore study how people make decisions: how much they
work, what they buy, how much they save, and how they invest their
savings . . . [M]aking decisions requires comparing the costs and benefits
of alternative courses of actions. (Mankiw 2005:4–5)
[A]t its core, economics is the science of choice. (Samuelson and Nord-
haus 2005:xviiii)
Economics assumes that human behavior reflects rational self-interest

. . . Self-interested behavior is simply behavior that enables a person to
achieve personal satisfaction, however it may be derived. (McConnell
and Brue 2005:4)
Mankiw as well as McConnell and Brue early on make statements

about assumptions mirroring the views of Friedman:
Assumptions can simplify the complex world and make it easier to

understand. To study the effects of international trade, for example, we
may assume that the world consists of only two countries and that each
country produces only two goods. Of course the real world consists of
dozens of countries, each of which produces thousands of different types
of goods. But by assuming two countries and two goods, we can focus
our thinking on the essence of the problem. . . . The art in scientific
thinking—whether in physics, biology, or economics—is deciding which
assumptions to make. . . . [E]conomic models omit many details to allow
us to see what’s truly important. (Mankiw 2005:21–22)
Economic principles, or theories, are abstractions—simplifications that

omit irrelevant facts and circumstances. Economic models do not mir-
ror the full complexity of the real world. The very process of sorting out
and analyzing facts involves simplification and removal of clutter. Un-
fortunately, this “abstraction” leads some people to consider economic
theory impractical and unrealistic. This is nonsense! Economic theories
are practical precisely because they are abstractions. The full scope of
economic reality is too complex and bewildering to be understood as a
whole. Economists simplify—that is, develop theories and models—to
give meaning to an otherwise overwhelming and confusing maze of facts.
Theorizing for this purpose is highly practical. (McConnell and Brue
2005:8)
From a microeconomic perspective, a key—if often unstated—

assumption of many analyses concerns who exactly makes decisions of
interest. The textbooks limit decision makers to a few entities that are said
to interact in particular ways in market economies:
Firms decide who to hire and what to make. Households decide which
firms to work for and what to buy with their incomes. These firms and
households interact in the marketplace, where prices and self-interest
guide their decisions. (Mankiw 2005:9)
[Microeconomics is] the branch of economics, which today is concerned

with the behavior of individual entities such as markets, firms, and
households. (Samuelson and Nordhaus 2005:5)
[T]he market economy has two groups of decision makers: households

and businesses, . . . (McConnell and Brue 2005:34)
From a macroeconomic perspective, the key assumptions revolve

around what are regarded as the major institutions of a society that affect
decision making. The textbooks assume state societies, which they divide
into those with market systems and those with centrally planned econo-
mies. The texts are almost entirely devoted to market systems, which seem
to be assumed to be superior to “command” economies:
Every society needs to develop an economic system—a particular set

of institutional arrangements and a coordinating mechanism—to respond to
economizing problems. Economic systems differ as to (1) who owns the
factors of production and (2) the method used to coordinate and direct
economic activity. There are two general types of economic systems; the
market system and the command system. . . . The alternative to the mar-
ket system is the command system, also known as socialism or commu-
nism. (McConnell and Brue 2005:33)
This textbook focuses primarily on the market economy of industrial-

ized nations. Before the rise of the market economy, going back to medi-
eval times, aristocracies and town guilds directed much of the economic
activity in Europe and Asia. However, about two centuries ago, govern-
ments began to exercise less power over prices and production meth-
ods. Feudalism gradually gave way to markets, or what we call the “mar-
ket mechanism” or “competitive capitalism.” (Samuelson and Nordhaus
2005:25)
Principle 6: Markets are usually a good way to organize economic ac-

tivity. (Mankiw 2005:9)
What Anthropologists and Sociologists Refuse to Ignore
If there is anything that exemplifies a certain common style in ethnographically-

oriented approaches to culture and society today, and sets them apart from
other kinds of social science, it is the habit, irritating to colleagues in some other
disciplines, frustrating to students, deemed perverse by potential funders, and
bewildering to the public, of responding to explanations with the remark, “We
need to complicate the story.”
keane 2003:222
Anthropologists and sociologists have long been interested in the rela-

tionships among social institutions, cultural norms, and individual de-
cision making. Some scholars emphasize how cultural norms and social
institutions constrain decision making; others focus on how norms and
institutions change over time as a result of individual choices in new cir-
cumstances. Anthropologists and sociologists have also written exten-
sively about the related question of the extent to which the choices of
individuals matter in the context of large-scale regional and global eco-
nomic and technological historical changes. The general issue of the rela-
tive power of individual actions and systemic forces is often called the
problem of structure and agency.
In the first half of the twentieth century, sociocultural anthropolo-
gists placed little emphasis on individual decision making. Anthropolo-
gists (including Benedict 1934, Malinowski 1922) generally agreed that
Western economic theory was mistaken in its fundamental assumptions
about the universality of self-interested decision making. Most thought
instead that economic behavior in tribal and peasant societies was deter-
mined by culturally specific institutions and norms. Sol Tax’s ethnogra-
phies of Mayas in Panajachel, Guatemala, in the 1930s and 1940s were a
rare exception. According to Tax (1953), the Mayas were “penny capital-
ists” who attempted to economize and maximize in ways similar to those
of entrepreneurs in industrial countries.
Starting around 1950, increasing numbers of anthropologists began to
think more carefully about the relationships among social institutions,
cultural norms, and economic decision making. Raymond Firth’s distinc-
tion between “social organization” and “social structure” (1951) is per-
haps the best-known attempt at this time to reconcile studies of individual
choices and analyses of larger systems. Firth used the term “social organi-
zation” idiosyncratically to refer to the continuing choices that individu-
als make when faced with new opportunities. “Social structure” consists
of long-standing institutions such as kinship systems, land tenure rules,
and political organizations. As new opportunities arise, individuals make
choices (social organization) that eventually lead to long-term institu-
tional changes (social structure). Firth’s ideas were developed further by
Fredrik Barth (1967) and Gerald Britan and Bette Denich (1976), who ar-
gued that individuals with similar goals and choices tend to make similar
decisions. The result is changing cultural patterns that ultimately affect
social relationships and institutional forms.
Many anthropologists studying economics in tribal and peasant soci-
eties agreed with Firth and Barth about the importance of studying indi-
vidual decision making. Others, however, continued to emphasize the
ways in which cultural norms and social institutions constrained choices.
This disagreement led to the famous, bitter, formalist-substantivist de-
bate of the 1960s and 1970s. The most fundamental issue in this debate
involved the definition of “economics.” For the formalists, economics is
about the methods used to analyze decision making in situations when
resources are scarce. The core of the field consisted of theories such as
rational choice, which could be applied to people everywhere. The sub-
stantivists, as their name suggests, thought that economics is about the
description of the operations of particular institutions associated with
production, consumption, and especially exchange at different places and
times.
The substantivists’ most important claim was that in places where
markets are either nonexistent or unimportant, economic choices are
embedded within social institutions that prescribe culturally appropri-
ate ways of making decisions about production, exchange, and consump-
tion. Most choices do not involve comparisons of costs and benefits as

western economic theory would predict; they are instead dictated by cul-
tural norms. The substantivists therefore paid little attention to the pro-
cess of decision making; their focus was on social institutions associated
with economic exchanges. In the years since the heyday of the formalist-
substantivist debate, anthropologists and sociologists have extended this
line of argumentation to include western societies. These scholars say
that even in societies with markets, many important resource allocation
decisions are influenced greatly by institutional structures and cultural
norms.
The concept of “embeddedness” has recently been called the “cen-
tral organizing concept” in economic sociology (Krippner and Alva-
rez 2007:220), a field that focuses on western, market-based societies.
In a programmatic article that introduced the idea of embeddedness to
many sociologists, Mark Granovetter restates the formalist-substantivist
debate:
How behavior and institutions are affected by social relations is one of

the classic questions of social theory. . . . Much of the utilitarian tradi-
tion, including classical and neoclassical economics, assumes rational,
self-interested behavior affected minimally by social relations. . . . At the
other extreme lies what I call the argument of “embeddedness”: the argu-
ment that behavior and institutions are so constrained by ongoing social
relations that to construe them as independent is a grievous misunder-
standing. (1985:481–482)
Granovetter briefly considers the relationship between embeddedness and

modernization. He says the level of embeddedness of economic behavior
in nonmarket societies is less than is claimed by substantivists (1985:482–
483). Furthermore, modernization changes this level less than the sub-
stantivists believe. However, the level of embeddedness in all societies
past and present is greater than is allowed for by formalist anthropologists
and—more importantly—most economists.
Although Granovetter felt compelled to offer this opinion, he really
is not much interested in nonmarket societies. His main concern is the
ways in which transactions in market societies are subsumed within hier-
archically organized firms through networks of interpersonal relations.
Granovetter distinguishes his network-oriented approach from both the
“undersocialized” views of formalists and the “oversocialized” views of
substantivists:
[D]espite the apparent contrast between under- and oversocialized views,

we should note an irony of great theoretical importance: both have in
common a conception of action and decision carried out by atomized
actors. In the undersocialized account, atomization results from narrow
utilitarian pursuit of self-interest: in the oversocialized one, from the fact
that behavioral patterns have been internalized and ongoing social rela-
tions thus have only peripheral effects on behavior. That the internalized
rules of behavior are social in origin does not differentiate this argument
from a utilitarian one. (1985:485)
In recent years, Granovetter has decided that the concept of embedded-

ness is so vague as to be meaningless (in Krippner et al. 2004). Nonethe-
less, his ideas remain influential in economic sociology. Most contempo-
rary economic sociologists criticize classical and neoclassical economics
for reasons similar to those of the substantivists. However, the interests of
these two groups of scholars differ. Substantivists and their successors in
anthropology examine social institutions and (to a lesser extent) cultural
norms; economic sociologists focus on social networks.
Although anthropologists have written extensively about social net-
works (as in Barnes 1972, Mitchell 1974, White and Schweizer 1998), they
have been more concerned about the extent to which individuals can af-
fect and resist global technological and economic changes (for example,
Comaroff 1985, Moberg 1992). This latter question arises in part because
of the growing influence of political economy analyses that emphasize the
actions and goals of entities such as states, multinational corporations,
political parties, insurgent groups, and development agencies. In their
textbook on economic anthropology, Richard Wilk and Lisa Cliggett ex-
plain well the challenges such analyses pose for scholars interested in local
decision making:
On . . . [a] global scale, history appears as conflicting forces, as modes of

production colliding with one another across the landscape, and there
often seems little room for human action . . . [H]uman actors seem like
tiny cogs on giant gears in some satanic factory. How can we put people
back into the picture? . . . How can we account for the reality, power, and
force of social structure and the same time grant some “agency,” some
autonomous decision-making power to individuals? (2007:112)
Scott (1990) and others have examined how local people in certain
places and times have attempted to improve their lives through group
action and organized resistance. There are lively debates among those who
study such social movements about the degree to which common religious
and cultural beliefs, especially those grounded in ethnicity, underlie the
formation of effective local resistance to outside pressures. In some cases,
common interests lead people from diverse groups to band together; in
other situations differences in ethnicity, class, and politics prevent effec-
tive actions.
The question of human agency is also part of a branch of anthro-
pology called “practice theory” (Bourdieu 1977; Ortner 1984, 2006). This
theory aims at exploring relationships between human actions (practice)
and global entities (“the system”), with equal attention to the impact of
the system on practice and the impact of practice on the system (Ortner
1984:148). Practice theory developed in reaction to what were regarded as
defects in the prevailing anthropological theories of the 1960s and 1970s:
[T]hey all had one thing in common: they were essentially theories of
“constraint.” Human behavior was shaped, molded, ordered, and de-
fined by external social and cultural forces and formation: by culture, by
mental structures, by capitalism. . . . [A] purely constraint-based theory,
without attention to either human agency or to processes that produced
and reproduced these constraints—social practices—was coming to seem
increasingly problematic. (Ortner 2006:1–2)
Practice theory has only rarely been directly concerned with individual
economic decision making. Nonetheless, the issues addressed by practice
theorists are clearly relevant to studies of choice.
Conclusions
Some decisions obviously matter a lot. No one would deny the signifi-
cance of the vote of the Supreme Court of the United States in the 1950s
outlawing segregation in public schools or the decisions that many finan-
cial institutions made in the past decade to invest in risky hedge funds.
Other decisions do not matter as much. Even I find it hard to care much
about my choice of which route to take when bicycling the mile between
my house and the university where I work. The extent to which a par-
ticular choice matters depends on both its consequences and the num-
ber of people affected. The choices of powerful decision makers such as
the president of an oil company or the members of a national legisla-
ture can have dramatic consequences for the lives of millions of people.
Less powerful individuals and groups, in contrast, often find themselves
in situations in which many choices they make have little effect on even
their own lives.
Although economists focus more directly than anthropologists on the
study of choice, most scholars in both fields agree on the importance of
studying significant decisions. The fields differ starkly, however, in how
best to study such decisions. Economists attempt to create parsimonious
models of choice that involve a limited number of clearly defined, mea-
surable variables that can be tested with empirical evidence. They regard
“economy” and “society” as separate spheres, each requiring its own dis-
tinctive type of analysis. In their models of choice, cultural norms and
social institutions are treated as external factors that are relevant only in
as much as they affect the values (“utilities”) that decision makers place
on alternative outcomes. Economists are therefore rarely concerned with
the complex interactions among cultural norms, social institutions, and
decision making. They pay little attention to the ways in which choices
are embedded in social institutions and the effects of cumulative decision
making on the evolution of cultural rules and customs.
Anthropologists place much more emphasis on the ways in which
choices are constrained by cultural norms and social institutions. In the
past, a few anthropologists interested in decision making (formalists) at-
tempted to mimic the assumptions and methods of economists. How-
ever, the great majority of contemporary economic anthropologists—
including many using mathematical models of choice—reject some or all
of the methods and assumptions of economics. There is general agree-
ment among anthropologists that most economists’ models distort reality
by ignoring many variables that affect choices. Unlike Milton Friedman,
they do not regard such distortions as a scientific necessity.
Almost all anthropologists think that treating “economy” and “so-
ciety” as separate categories is a basic analytic error. Economists are also
sometimes scorned by anthropologists for their disregard of empirical
evidence in their casual assumption that theories developed to describe
behavior in market societies can be easily applied everywhere. Perhaps
most importantly, many anthropologists and other social scientists think
that economists fail to sufficiently emphasize the extent to which indi-
viduals’ choices are constrained by historical circumstances and power
differentials between the rich and the poor.
Although I agree with most other anthropologists about these short-
comings of economic theory and practice, I nonetheless would argue that
the study of choice is of fundamental importance in understanding both

everyday life and cultural evolution.2 People in all societies are continu-
ally making conscious choices in which they weigh the costs and benefits
of different options. As Firth (1951) pointed out long ago, cultural trans-
formations are in part the results of economic decisions that individuals
and groups make in changing circumstances.
Most of the rest of this book compares how economists, anthropolo-
gists, and other social scientists look at different types of decisions. I
begin with the complicated choices that individuals in many places must
make between paid and unpaid work.
CHAPTER 2
Choices between Paid and Unpaid Work
Social scientists analyzing diverse economic decisions have often at-

tempted to estimate the monetary value of unpaid labor and production
for home consumption. In this chapter I discuss the reasons for these at-
tempts and examine some of the theoretical and methodological prob-
lems associated with such efforts. My focus is on estimates of the value of
three types of unremunerated work—subsistence agriculture, non-timber
forest products (NTFPs), and domestic labor (housework). In order to
understand why anyone would want to make such estimates, it is helpful
to consider certain measurement problems that arise when economists at-
tempt to make cost-benefit analyses.
People making difficult decisions must weigh the advantages and dis-
advantages of alternative choices they might make. The method of cost-
benefit analysis (Boardman et al. 2006, Nas 1996) was developed to aid
in such decisions. The basic ideas of cost-benefit analysis, which come
directly from expected utility theory, are not hard to understand. The
first step is to assign numerical values to the advantages and disadvan-
tages associated with different possible courses of action. Next, estimates
are made of the probability of different outcomes if particular options are
selected. Finally, calculations based on these values and estimates indicate
which possible choice has the most favorable cost-benefit ratio.
In practice, cost-benefit analyses can be extraordinarily difficult. Most
decisions have multiple costs and benefits, which may not all be easily
measured by one metric such as money or time. A good example of this is
a restaurant customer choosing between an expensive steak and a cheaper,
less fattening salad. Costs and benefits influencing this decision might
include price, taste preferences, and calories. The weight any individual
customer assigns to each of these considerations varies; a rich patron of
Choices between Paid and Unpaid Work 39
a restaurant is less likely to be influenced by cost than someone who can

barely afford eating out. But even if one somehow knows how important
each factor is in influencing the decision of a particular customer, their
advantages and disadvantages may seem incommensurable. The monetary
cost and caloric content of steaks and salads, for instance, are obviously
measured in different units. Moreover, even figuring out the unit with
which to measure some variables such as taste preferences can be difficult.
Economists conducting cost-benefit analyses usually emphasize in-
puts and outputs that can be measured monetarily. When confronted
with a variable measured in other units (time, noise, odor, caloric con-
tent, taste preference), economists often attempt to devise a way to “im-
pute” a monetary value. When imputation seems impossible, such costs
and benefits may be omitted from an analysis. There are good reasons for
such omissions. Economists’ models are simpler if the assumption is made
that a decision-maker is attempting to maximize one single thing such as
income from sales.1 In the societies where most economists work, mone-
tary costs and benefits are a major influence on many important decisions.
Scholars critical of conventional cost-benefit analyses such as Waring
(1996) argue that the focus on easily measured monetary inputs and out-
puts results in economic analyses that neglect significant factors affecting
certain choices. In particular, subsistence production and unpaid labor are
often ignored in both input/output analyses and statistical measures such
as gross domestic product. This neglect may influence public policies that
affect people such as small-scale farmers and domestic workers. Some of
these scholars therefore think it is useful to attempt to impute a monetary
value to subsistence production and unpaid labor.
Ethnicity, Subsistence Production, and Wage Work in Belize
I did not become interested in estimating the value of subsistence pro-

duction and unpaid labor as a result of worrying about the shortcomings
of the analytic methods of professional economists. Instead I was try-
ing to understand a practical problem I encountered in my research—the
reasons for differences in the economic activities of diverse ethnic groups
in British Honduras (now the independent country of Belize) in the early
1970s.
Belize is today a laid-back tourist destination renowned for its snor-
keling, nature reserves, and archaeological sites. But at the time of my
fieldwork British Honduras was a colonial possession scorned by travelers
as a bizarrely isolated backwater. Writers about the colony were fond of

Aldous Huxley’s sardonic observation that “if the world had any ends,
British Honduras would certainly be one of them. It is not on the way
from anywhere to anywhere else. It has no strategic value. It is all but un-
inhabited” (1934:32). The views of world travelers about British Honduras
had not changed much in the almost four decades that elapsed between
Huxley’s remarks and my fieldwork. Even one of my graduate school ad-
visers reacted with puzzlement when I announced my research plans.
“Why would you want to go there?” he asked. “It’s a pit,” he went on to
say, doubtless comparing Belize City and its open sewers to the beaches of
the well-known Caribbean islands where he conducted research.
What attracted me to British Honduras were the historical circum-
stances that led to the isolation and desolation that bemused Huxley, my
adviser, and other visitors. Although there were once sizable numbers of
Mayas in the area that is now Belize, the region was sparsely populated
when Europeans came to the Americas. The Spanish did not settle the re-
gion in significant numbers; instead most European residents in the seven-
teenth and eighteenth centuries were British foresters who extracted first
logwood and later mahogany. The woodcutters needed a labor force, and
starting around 1700, slaves were brought into British Honduras, mostly
from Jamaica. After emancipation in 1833 the descendants of slaves con-
tinued to work in forests, often raising small plots of subsistence crops to
feed their families.
The largest population group in British Honduras in the nineteenth
and early twentieth centuries was “Creoles” of mixed European and Afri-
can ancestry. By 1970 the colony’s peoples were a complex ethnic mixture.
Although about half the 100,000 or so residents were Creoles, there was
a rapidly growing Spanish-speaking mestizo population in the north and
west that was culturally similar to the Ladinos of neighboring Guatemala.
About 10,000 “Black Caribs” (now called Garifuna) lived in the south of
British Honduras. They were descended from escaped slaves of African
origin and the indigenous peoples of the Caribbean islands of St. Vincent
and Dominica. At the end of the nineteenth century, the Caribs were
evicted from the Caribbean after being on the wrong side in conflicts be-
tween the British and the French. They settled along the Atlantic coast of
Central America; most are bilingual in Carib (an indigenous language of
South America) and either English or Spanish. Mayas who had migrated
from either Guatemala or Mexico comprised another 10 percent of the
population; they were usually bilingual in one of several Maya languages
and either English or Spanish. There were also numerous smaller ethnic
groups in the colony, including German-speaking Mennonites and ex-
patriates from Britain, the United States, and elsewhere.
By 1971 the British were eager to abandon their colony in Central
America. Britain had been pumping money into British Honduras ever
since the demand for mahogany had lessened in the first part of the
twentieth century. The place remained a colony only because of a long-
standing territorial dispute between Britain and Guatemala. During the
colonial era the British claim of part of the Central American mainland
was disputed by Spain. The territory remained contested after the in-
dependence of most Latin American nations. In 1859 an agreement was
reached in which British sovereignty would be recognized if Britain con-
structed a road connecting Guatemala City and the city of Belize on the
Caribbean Sea. Because the road was never built, Guatemala continued
to press its claims. Only the presence of the British army had deterred an
invasion on several occasions. Although British Honduras was internally
self-governed in the early 1970s, the fear of an attack by Guatemala pre-
vented Belizeans from pursuing complete independence.
British colonial officials and the internal Belizean government thought
that agricultural development was necessary to improve the local econ-
omy and reverse the unfavorable balance of trade. Domestic shortages had
forced the government in many years to import rice and red kidney beans,
the staples of much of the population. Both attaining self-sufficiency in
staple foods and increasing agricultural exports seemed feasible. British
Honduras had a low population density and large tracts of unused, cul-
tivable land. Diverse projects aimed at stimulating agriculture. The gov-
ernment built roads into remote hamlets, provided price supports, sold
land to farmers planting permanent crops, formed cooperatives, and en-
couraged the use of fertilizers, herbicides, pesticides, and new types of
seeds. These programs had limited success. Norman Ashcraft, an anthro-
pologist who carefully examined agricultural development programs dur-
ing this period, reported:
In contrast to expectations, small-scale producers have not responded to

guaranteed price incentives, for their contributions to government pur-
chases [by the relevant state institutions] has been declining rather than
increasing. It seems evident that most cereal farmers continue to sell
only the excess over household needs and that excess is not increasing.
(1973:90–91)
I was struck by a “cultural” reason that was sometimes offered for the
failure of these programs. Many projects were aimed at Creoles living in
the center and south of British Honduras. Development officers claimed
that Creole males regarded agriculture as an inferior, transitory occupa-
tion that occupied time away from more important forestry work.
There is evidence . . . that the organization of forest work encouraged

antagonism and even bred a contempt for agriculture; the relative free-
dom of the forester returning to the town for his considerable rest peri-
ods contrasted with the continuous attention which cultivation involved.
(Settlement Report 1948:253)
[Creoles] are, perhaps, not natural farmers and do not work the land
continually and in harmony with it. (Romney et al. 1959:151)
Two themes were implicit in these assertions. When Creoles were de-
scribed as “not natural farmers,” they were being compared to the Mayas,
who planted larger fields and worked less as wage laborers. While the
Creoles’ alleged preference for wage labor was thought to have been rea-
sonable at earlier times when opportunities for forest work were abun-
dant and incentives for cash cropping minimal, the continued aversion to
farming was regarded as an irrational obstacle to economic development.
Ashcraft, however, thought that the Creoles were sensible in not respond-
ing much to agricultural incentives (1973:91). He noted the poor road sys-
tem, the high cost of transportation, and a cumbersome marketing board
system that made it difficult for farmers to sell crops to the state at fixed
prices. Ashcraft also observed that there were increasing employment op-
portunities on sugar and citrus plantations. Creoles, he suggested, might
reasonably prefer the ready cash from wage work on commercial farms to
the uncertain returns from their own farming.
Although Ashcraft’s book on agricultural development in British Hon-
duras came out after I finished my fieldwork, I knew about his views prior
to conducting research from his doctoral dissertation (Ashcraft 1968) and
personal correspondence. My initial reaction on reading about this con-
troversy was to side with Ashcraft. I was at the time (and for the most part
remain) committed to materialist approaches to economics. I assumed
that human groups faced with changing material circumstances will ordi-
narily alter their economic strategies in attempts to solve whatever new
problems arise. From this perspective, I thought that the cultural “tra-
ditions” of particular ethnic groups would not usually pose a significant
obstacle to economic development programs. I was, however, willing to

consider that I might be wrong in particular cases and thought this might
be an empirical question that I could investigate as part of my fieldwork.
I eventually decided to focus my research on how Creole, Carib, and
Maya residents of three villages in the Stann Creek (now Dangriga) dis-
trict of southern British Honduras made decisions over the course of a
year about how to allocate their household labor. A key part of my analy-
sis consisted of calculations of input/output ratios for diverse economic
activities. I was especially interested in comparing the monetary returns
per unit of labor for farming and wage labor. Were Creoles, for example,
preferring wage labor to farming even in circumstances where agricul-
ture seemed to offer better returns? Or were their choices between these
activities just the results of straightforward cost-benefit comparisons un-
related to Creole culture and history?
Although I never thought that answering this question would be easy,
I learned during fieldwork how naive I had been in framing my research
problem. Members of village households rarely were faced with direct
choices between wage work and farming. Some participants in farming—
the elderly, children, most women—rarely had the option to do wage work.
Moreover, agriculture had a seasonal cycle in which periods of heavy
labor demands only sometimes coincided with opportunities for wage
work. Even when villagers decided to do wage work during a peak part of
the agricultural cycle, they often were able to persuade family members
to help out with tasks such as clearing fields, planting, or harvesting.
Comparing the returns per unit of labor for wage work and farming
in any case was not simply a matter of attempting to calculate the amount
of money earned per hour. Villagers talking about the advantages and
disadvantages of wage labor and farming did not restrict their discussion
to the potential cash income from these two types of work. Agriculture
in British Honduras, as everywhere, was a risky undertaking; yields and
prices for crops varied from field to field and from year to year. Income
from farming came many months (or in the case of tree crops, years) after
fields were cleared. Wage labor, in contrast, provided a reliable, quick
source of income. Farming required a labor commitment of at least five or
six months; wage labor could be taken on for short periods when money
was needed.
The theoretical and methodological problem that puzzled me the most,
however, was how to place a “value” on subsistence agriculture—crops
that were not sold because they were grown for home consumption. Sup-
pose, for example, that someone (either a local farmer or an outsider such
as an agricultural economist) wanted to calculate the returns per labor unit

of an acre of corn.2 For corn sold at market, one could make a rough cal-
culation by estimating the yields, work input, and selling price. But what if
the corn was eaten at home or fed to animals? And what should an analyst
do if some corn was sold at market and some was consumed at home?
This analytic problem consisted of two distinct questions. Could an
estimate of monetary value be made for subsistence agriculture? If so,
how should such an estimate be made? These were not idle academic in-
quiries. Most rural households in British Honduras obtained some of
what they ate by farming, fishing, and hunting. By so doing, they reduced
the amount of money that had to be spent on food. Clearly, members of
such households choosing between wage work and other activities were
influenced by their perceptions of the value of subsistence production.
In my thesis I eventually reached the following conclusion about the
value of subsistence agricultural production among rural residents of
British Honduras:
[I]f one wishes to calculate the total value of a farmer’s harvest [nowa-
days I would say “the harvest of a farm household”], . . . the value of a
given unit of a crop used for home consumption is not equal to [the value
of ] the same unit sold at market. If it is assumed that agricultural activity
and diet are independent of one another [in retrospect a shaky assump-
tion], food that is needed for subsistence purposes, but is not grown,
must be purchased. For this reason crops consumed at home should be
valued at the price they sell for at stores and not at the price the farmer
gets when he [Of course, today I would not use the male pronoun.] sells
them. (Chibnik 1975:81)
Although I realized that other researchers must have confronted simi-

lar problems, I made no attempt to search the scholarly literature to see
how this issue was ordinarily handled. A few years later, I decided that
this issue was of sufficient general interest that it would be worthwhile to
examine the value of subsistence agricultural production in more depth
(Chibnik 1978).
Imputing Value to Subsistence Production
Although it is obviously impossible to place a monetary value on labor

and subsistence production in societies without cash, numerous attempts
have been made to measure the “efficiency” of different types of food-

getting methods in such places. These efforts were perhaps most visible
in the 1960s and 1970s when scholars from diverse disciplines were com-
paring the caloric returns per unit of labor input and per unit of land of
different subsistence techniques in their efforts to develop theories about
cultural evolution (for example, Boserup 1965, Harris 1977) and “opti-
mal foraging” (reviewed in Smith 1983). For example, the anthropologists
Richard Lee and Allen Johnson calculated labor inputs and caloric re-
turns for various ways to get food among the !Kung in the Kalihari desert
in Botswana (Lee 1979) and the Machiguenga in the Peruvian Amazon
(A. Johnson 1978). Their sophisticated, meticulous comparisons of input/
output ratios suggested that labor devoted to certain food-getting meth-
ods was more efficient in certain respects than that devoted to alternative
subsistence techniques.
The analysts of energetic efficiency rarely equated efficiency with
“value.” An examination of one of Johnson’s findings suggests why they
were reluctant to make this seemingly obvious inference. Johnson noted
(1978:81) that the Machiguenga obtained about 45 calories growing maize
for every calorie of work effort; the comparable return for hunting and
gathering was 0.8 calorie. This would suggest that labor on maize was
much more valuable than that spent hunting and gathering. One wonders
why the Machiguenga ever foraged at all. As Johnson explains, the reasons
are not mysterious. Because foraging and corn growing can be done at
different times, the Machiguenga rarely directly chose between these two
options. Furthermore, the Machiguenga received various noncaloric “re-
turns” (protein, nonfood animal and vegetable products) from hunting
and gathering that were not available from farming.
I think that attempts to estimate any sort of value of labor and subsis-
tence production are fruitless in societies without money. In such places
the famous distinction between “use value” and “exchange value” is rele-
vant.3 Production for use value aims at the acquisition of specific goods;
production for exchange value, in contrast, aims at the accumulation of
general “wealth.” I would not want to argue that there is no production for
exchange value in societies without cash. Nonetheless, the preponderance
of production for use value in such societies makes attempts to compare
the “value” of different types of labor or subsistence production impos-
sible for all practical purposes.
The remarkable economist A. V. Chayanov lucidly explained many
years ago why the absence of money hindered the comparison of the value
of different economic efforts. Chayanov was one of a large group of Rus-
sian scholars carrying out detailed empirical studies of the agricultural

activities of “peasant” households in the first part of the twentieth cen-
tury.4 His work on these projects convinced him that certain aspects of
classical economics could not be applied to the analysis of certain kinds
of farming.5 One of his arguments (originally published in the 1920s) was
that conventional calculations of profit were impossible in nonmoneta-
rized societies:
[In such circumstances] the question of the profitability of various ex-

penditures cannot arise—for example whether growing hemp or grass
would be more profitable or advantageous. For these plant products are
not interchangeable and cannot be substituted for one another, therefore,
no common standard can be applied to them. (Chayanov 1966:4)
Attempts to assign numerical values to unpaid labor and subsistence

production seem more plausible in societies with money. One might, for
example, estimate the economic value of unpaid labor on a task such as
house cleaning at what it would cost to pay someone to do this work.
Similarly, the economic value of tomatoes grown in a garden and con-
sumed at home could be estimated at what it would cost to buy them in a
market or store.
Even in societies with money, estimates of these values are not at all
straightforward. Certain types of unpaid work (repairing toasters) and
subsistence production (freshly hunted meat) may not be readily avail-
able for purchase at some times and places. More importantly, Chayanov
argued that household agricultural labor—and presumably other forms
of unpaid work—cannot be valued at the prevailing wage rates for farm-
workers (1966:88–89). Chayanov pointed out that on “capitalistic” farms,
where all work is paid for, increases in labor inputs without corresponding
income gains can be disastrous because profit equals gross income minus
outlay on materials minus wages. On “family farms” using unpaid labor,
however, increases in labor inputs without corresponding income gains do
not necessarily lead to monetary losses. Because labor inputs that are dis-
astrous in capitalistic agriculture can be acceptable on farms using unpaid
workers, valuing family labor as equal to the wages of hired workers is, ac-
cording to Chayanov, absurd. This leads to family farms being regarded
as operating at a loss in situations when they are actually making money.
Chayanov agreed (somewhat ironically, given his opposition to “capi-
talist” economics) with certain neoclassical economists (such as Krishna
1969) that no monetary value at all can be assigned to family agricultural
labor and subsistence production even in a highly monetarized context.

Their argument is that not all units of subsistence labor and production
are equally valuable; initial work inputs and outputs are worth more than
later ones. The first part of a harvest may be necessary to avoid starva-
tion; this is less so of later parts. Furthermore, there may be diminishing
returns for additional labor inputs after a certain point for many types of
work, such as weeding and clearing fields. In addition, the value of any
particular input of labor may vary among households according to their
particular situations. If all other things are equal, adults in a household
with several young children may be willing to work harder at subsistence
production (place higher values on later inputs of labor) than adults in
a household with no young children. Such arguments can easily be ex-
tended to non-agricultural unpaid labor.
Although such arguments are thought-provoking, they suffer from a
fundamental flaw. People often do choose between subsistence agricul-
ture and cash crops (Moerman 1968, Scott 1976:23–24) and between un-
paid work at home and wage labor. In the United States, for instance,
many farm households have decided to grow very little for home con-
sumption and instead buy most of the food they eat. Analogously, couples
in the United States with young children often engage in difficult deci-
sions about whether both husband and wife should seek paid work. If they
decide to do so, paying for child care may be necessary. The alternative
usually involves one member of the couple engaging in paid work (still
usually the husband) and the other staying at home and caring for the
children. Although such choices are clearly influenced by nonmonetary
considerations, it would be foolish to deny that costs are also usually rele-
vant. If people sometimes choose unpaid labor and subsistence agricul-
ture in preference to wage work and cash cropping, they must be at least
in part subjectively comparing the monetary implications of their options.
The question remains as to how an outside analyst should place a mone-
tary value on unpaid work in such cases.
The Value of Crops Consumed at Home
In my article on the value of subsistence production (Chibnik 1978), I dis-

cussed the then-common practice of valuing crops consumed at home at
the prices for which they could be sold. I wrote that the economist John
Mellor had made convincing arguments against this practice. According
to Mellor (1966),
The farmer correctly attaches a higher price to production for home

consumption than to production for sale since he [sic] pays the retail
price for what he buys and receives the wholesale price for what he sells.
(200)
Mellor illustrated his point by discussing a hypothetical farmer grow-

ing both wheat and cotton. This farmer sells only a small portion of the
wheat, consuming the rest at home. If the price of wheat dropped relative
to that of cotton, it might be reasonable for the farmer to reduce wheat
production and increase cotton production until no more wheat is pro-
duced for sale. Mellor then argued:
In considering further shifts of resources out of wheat, the farmer should

compare not the wholesale [selling] price of wheat, but the [retail] price
he would have to pay if he purchased wheat . . . No further cut in wheat
production below subsistence needs will be made until the relative price
of wheat has dropped by at least the difference between the buying and
selling price of wheat. (Ibid.)
Mellor thus suggests that the subsistence production of wheat (in this
case) should be valued at its retail price. I concluded that such a valua-
tion was “the most plausible procedure that had been suggested” (Chib-
nik 1978:569).
In the three decades since I published this piece, social scientists have
written extensively about estimating the economic value of unpaid do-
mestic work, non-timber forest products, and hunting and fishing for
home consumption. Very little new has been said, however, about placing
a monetary value on crops and animals raised for subsistence purposes
by households participating in market economies. I therefore restrict my
discussion about agriculture in what follows to as yet unresolved meth-
odological questions about problems associated with valuing subsistence
production at retail prices.
Farming is inherently a risky enterprise. Yields vary depending on
weather conditions, the extent to which weeds and pests can be con-
trolled, and the effectiveness of capital expenditures such as irrigation
and fertilizer. When crops are sold, there is inevitably uncertainty about
prices, even when governments provide a guaranteed market. Farmers in
market economies thinking about the advantages and disadvantages of
different crops therefore must consider variability in yields and prices as
well as average returns to inputs of land, labor, and capital.
Long-established (“traditional”) subsistence crops are often less risky

than agricultural products sold at markets. Time-tested varieties of staple
crops usually provide adequate yields in varying environmental condi-
tions. Cash crops, in contrast, may be recent introductions to an area that
is subject to blights and provide good yields only in optimal growing con-
ditions. Considerable uncertainties regarding prices are usually associated
with cash crops; variation in selling prices is obviously not a risk factor for
staple crops consumed at home. Most importantly, staple crops have high
use value because they are eaten; many cash crops (coffee, tea, cotton,
tobacco) have relatively little use value if not sold. All other things being
equal (yields per unit of land and labor, selling prices at market), farmers
are therefore likely to prefer staple food crops to cash crops. If farmers’
decisions are influenced by both risk factors and differences between buy-
ing and selling prices of staple crops, they therefore should value subsis-
tence crops even higher than retail price.
Valuing subsistence crops at market prices makes the debatable as-
sumption that if they are not grown, they must be purchased. Even in
places where households grow much of what they eat, the relationship
between food consumption patterns and the availability of different crops
is not self-evident. In order to ensure that most of what they consume is
homegrown, some households may alter their diets and eat less-preferred
subsistence foods. Others may prefer to purchase food if necessary to
maintain their customary diets. If a household fails to produce enough of
a staple crop to meet its preferences, the most likely response of its mem-
bers might well be both to purchase some food and to shift diets. Such a
reaction challenges the assumption of unchanging consumption patterns
that underlies the valuation of subsistence crops at retail price.
Retail prices of agricultural products are usually lowest at harvest time,
when supplies are high. Even if one assumes that subsistence crops should
be valued at their retail prices, one should probably not use the price at
harvest. Instead, some other method (perhaps the average price over the
course of a year) seems preferable.
Some crops (corn, soybeans) that are grown in part for home con-
sumption can be fed to domestic animals. Certain products from these
animals (meat, eggs, milk, cloth) are consumed at home; others are sold at
market. Estimating the monetary value of crops fed to animals is a daunt-
ing methodological task. Nonetheless, this value (however calculated) dif-
fers from that of both crops consumed at home and those sold at market.
Researchers assigning a value to subsistence production must consider
what proportion of a crop is consumed by domestic animals.
Non-Timber Forest Products
The destruction of tropical rainforests is widely recognized as one of the

major environmental problems of our time. Much of this damage is caused
by entrepreneurs attempting to either earn money or gain land rights
through the sale of timber and the use of formerly forested land for crops
and cattle raising. Environmentally oriented scholars from diverse disci-
plines (among them Godoy and Lubowski 1992:423 and Peters, Gentry,
and Mendelsohn 1989:655) have observed that policy makers often as-
sume that tropical forests have no value unless they are logged or farmed.
These scholars have emphasized the ecological importance of non-timber
forest products such as wild food plants, honey, resin, spices, game, fire-
wood, charcoal, and raw materials for handicrafts. While NTFPs are not
always environmentally sustainable, they ordinarily cause much less eco-
logical damage than either timbering or agriculture.
Ecologists have argued that NTFPs are economically valuable. In an
influential article about NTFPs that appeared in the prestigious British
science journal Nature, the ecologists Charles Peters and Alwyn Gentry
and the economist Robert Mendelsohn attempted to calculate the market
value of all the tree species in one hectare in the Peruvian Amazon. They
concluded that
tropical forests are worth considerably more than has been previously as-
sumed and . . . the actual market benefits of timber are very small relative
to those of non-wood resources. Moreover, the total net revenue gener-
ated by the sustainable exploitation of “minor” forest products are two or
three times higher than those resulting from forest conversion [logging,
cattle raising, and farming]. (1989:655)
In the late 1980s, enormous publicity was being given to the worldwide
disappearance of tropical rainforests. The findings of Peters, Gentry, and
Mendelsohn were described in a lengthy article in the science section of
the New York Times (July 4, 1989) and were cited in a sharply worded edi-
torial in that newspaper about the dangers of excessive logging.
When Peters, Gentry, and Mendelsohn assigned a monetary value to
the NTFPs in a small plot of Amazonian rainforest, they made several
simplifying assumptions. They considered only tree products and ignored
other NTFPs. Their calculations were restricted to products that could
be sold at markets; they did not consider items that were used exclu-
sively for home consumption. In cases where NTFPs or wood could be
both sold and consumed at home, no attempt was made to measure local
people’s actual allocation of these products between market sales and sub-
sistence use. Perhaps most importantly, the authors did not discuss the
extent to which an increased production of NTFPs might lower market
price. The limited demand for many NTFPs suggests that valuing them
at current market price overestimated their potential value in comparison
with timber.
My focus here is on the neglect by many authors discussing NTFPs—
exemplified by Peters, Gentry, and Mendelsohn—to examine carefully
the value of forest products used exclusively or primarily for subsistence.
In a recent perceptive article examining the economic value of unmar-
keted NTFPs Charles Delang argues,
In many communities . . . NTFPs that are directly consumed play a more

important role in the livelihood of the population than the cash earned
with the sale of NTFPs or other commodities. Indeed, the NTFPs that
are consumed rather than sold on market can be considered income in
kind rather than in cash. Thus, ignoring the role of NTFP consumption
in the livelihoods of rural populations gives a very distorted view of the
importance of NTFPs—and of their economic values. It also gives the
wrong message that everything that does not go through the market,
and does not have a market price, does not have an economic value, and
therefore is not worth protecting. (2006:65)
Delang goes on to review several methods that have been tried to esti-
mate the economic value of unmarketed food plants.6 The three methods
he discusses that are most commonly used—opportunity cost, contingent
valuation, and substitute product value—all are associated with signifi-
cant theoretical and methodological difficulties. Furthermore, they result
in strikingly different conclusions about the economic value of particular
NTFPs.
Opportunity cost. Scholars using this method (for example, Adamowicz

et al. 1998) measure the amount of time local people spend collecting
NTFPs for subsistence purposes. Researchers then place a monetary
value on this time, ordinarily the local wage rate. In so doing, they are
using the same method of valuing unpaid labor that Chayanov criticized
so strongly. This method makes the questionable (“opportunity cost”)
assumption that time collecting NTFPs could otherwise be allocated to
earning money via wage labor. Moreover, it seems counterintuitive to as-
sign different monetary values to the same NTFPs in a particular place as

wage rates change. An additional methodological problem arises because
people often combine trips to collect NTFPs with other activities. De-
termining what percentage of their time on such trips should be counted
in calculations is not straightforward.
Contingent valuation. This method, which does not seem to me to be par-

ticularly useful in the case of NTFPs, has been used to estimate the value
of diverse environmental “goods,” including protected areas (Dharma-
ratne, Sang, and Walling 2000) and whales (Bulte and Van Kooten 1999).
In the language of ecological economics, “consumers” are asked how
much compensation they would be willing to accept for the loss of envi-
ronmental benefits such as clean water or access to a beach. For unmar-
keted NTFPs, this would mean asking people what they considered to be
a fair market price for these products. Most scholars who have seriously
considered the application of this method to NTFPs (for example, De-
lang 2006:65, Godoy and Lubowski 1992:427) have a hard time imagin-
ing that sensible answers could be given to such inquiries.
Substitute product value. This method (Godoy, Lubowski, and Markandya

1993:272) involves finding marketed NTFPs that are “similar” to the un-
marketed NTFP whose value is being estimated. The unmarketed NTFP
is assigned either the selling or retail monetary value of the similar mar-
keted product. When the retail price is used, this is analogous to Mellor’s
method for placing a monetary value on agricultural crops produced for
home consumption. The obvious methodological problem here is identi-
fying marketed NTFPs that can be considered close substitutes for un-
marketed NTFPs.
In a monthlong study in a Thai village, Delang compared the results

of opportunity cost and substitute product methods in placing monetary
values on wild plants collected by the Karen, a local indigenous group. For
the opportunity cost method, Delang used the local wage rate for casual
agricultural labor to impute a monetary value for the time spent collect-
ing wild plants. For the substitute products method, Delang (with the
help of the Karen) grouped 134 wild food plants that were gathered (but
not marketed) into six categories—leaves, stems, roots, fruits, flowers,
and bamboo shoots. The prices of all food plants sold in a nearby mar-
ket town were recorded. With the help of the Karen, Delang grouped
the commercial food plants into the six categories that had been devised
for the NTFPs. The average price of each category of commercial food
plants was then used to calculated the value of the wild food plants con-
sumed at home.
The two methods resulted in surprisingly different estimates of the
value of collected wild food plants. Using the opportunity cost method,
Delang calculated that the value of NTFPs collected by the “average”
household (5.33 members) was about fifteen days of wage labor at eighty
Baht (the Thai monetary unit) per day. In contrast, the substitute produc-
tion method resulted in a much higher valuation:
[T]o make up for the loss of wild food plants, the Karen would have to
buy food plants in the market. The (surrogate) market value of the wild
food plants that the average household . . . consumes is 11,505 Baht per
year. This much higher value corresponds to approximately 114 days
of work at 80B/day. Thus, by working for 15 days gathering wild food
plants, the Karen are able to save the same amount of money they earn
in 114 days. (2006:70)
The assumption that the Karen would buy comparable food plants at mar-
ket if they did not collect them is questionable. They might well instead be
able to purchase cheaper foods. Nonetheless, Delang’s study clearly shows
the difficulties associated with attempting to value subsistence production
in particular cases.
Unpaid Labor in Industrial Societies
Although economists analyzing industrial societies ordinarily focus on

monetary transactions, many important tasks are carried out by unpaid
workers. The best-known such tasks are chores associated with maintain-
ing a household such as cleaning, cooking, and child rearing. But many
other activities essential to the well-being of industrial societies are done
by volunteers in hospitals, food banks, and other community institutions.
Such unpaid labor is often culturally regarded as not being “work” (Fink
1987).
The problems involved in attempts to assess the “worth” of unpaid
labor exemplify the general difficulties that economists face when con-
fronting “values” that cannot be easily measured numerically. An exami-
nation of several relevant cases in the United States shows again why such
analytic problems cannot be dismissed as abstract complexities of interest
only to academics.
In the mid-1970s I eked out a living for couple of years working as a

freelancer on diverse social science projects. One of my jobs was on a
project funded by the National Academy of Sciences that was evaluating
the federal government’s Experimental Technology Incentives Program
(ETIP). As its name suggests, the ostensible goal of ETIP was to exam-
ine how small-scale changes (experiments) in government policies could
stimulate technological innovation (Britan and Chibnik 1980). Many of
the experiments were, to my discomfort, based on free-market assump-
tions that government regulations were discouraging entrepreneurialism.
A typical project tried to stimulate innovation in the pharmaceutical in-
dustry by shortening the time the government took to approve new drugs.
The shortened approval period in my view led to less information about
the long-term effects of these drugs.
I looked at one experiment, however, that did not seem to be affected
by ideological considerations. Government agents in charge of buy-
ing diverse items thought that the procurement methods were not cost-
effective. Contracts for products such as washing machines were given to
the lowest bidder, ignoring considerations such as durability, repair costs,
and energy use. The idea in the experiment was to devise procurement
systems for different products that considered not only initial prices but
also the expected costs over their lifetimes.
I was struck in particular by economists’ analyses of the lifetime costs
of lawn mowers. The policy makers compiling a list of factors that they
wished to include in their procurement models recognized that noise was
an important aspect of lawn mower performance. Although the econo-
mists wanted to reward bidders with quieter lawn mowers, they were un-
able to come up with a way to put a monetary value on noise. The methods
the economists created eventually omitted noise as a factor to consider in
government lawn mower purchases. By so doing, they implicitly rewarded
companies that did not allocate research funds and time to developing
innovative ways to make lawn mowers quieter.
Two more recent examples further illustrate how social policy can be
influenced by difficulties in imputing monetary values to environmental
variables. Over the past two decades, large-scale industrial hog lots have
become a common feature of the landscape in rural parts of states includ-
ing Iowa, Illinois, and North Carolina. Local social movements have op-
posed these facilities because of their economic effects. Because the hog
lots are usually run by large corporations, they are part of an increasingly
capital-intensive agriculture that discourages the continued existence of
small and mid-size farms. What I want to focus on here, however, are en-
vironmentalists’ objections to the confinement facilities’ effects on air and

water pollution. While monetary values can be placed on certain aspects
of air and water pollution, the smell of hog lots has so far been omitted
from economic discussions of their effects. No one also been able to show,
for example, that the odor of hog lots influences nearby property values.
Nonetheless, the smell certainly affects the quality of rural life.
Wind power is often advocated as a sustainable energy source that
is environmentally less destructive than fossil fuels and nuclear power.
One might think that environmentalists would therefore applaud a pro-
posed offshore New England project to harness wind energy. However,
the Cape Wind project became famous (Williams and Whitcomb 2007)
for its opposition from wealthy, politically powerful environmentalists
such as the Kennedy family. The proposed wind turbines were regarded
as unsightly by the usually environmentally conscious residents of nearby
Nantucket Island. Although much about the environmental consequence
of wind turbines can be measured monetarily (costs of construction and
maintenance, value of energy produced), the financial costs of their aes-
thetic downside can only be calculated by making speculative estimates
about their effects on property values. But the opponents of wind turbines
on aesthetic grounds are surely thinking about more than property values.
Given the myriad theoretical and methodological problems associated
with measuring seemingly intangible costs and benefits, why would any-
one think it worthwhile to try to impute a monetary value to unpaid labor
in industrial societies? In a provocative book written some time ago,
Marilyn Waring argues (1996) that such imputation matters because this
labor is mostly carried out by women. By making such work visible, im-
putation has the potential to influence public policy and cultural values.
Waring shows how the activities of typical women in two quite different
societies are ignored by policy makers compiling measures of national
productivity:
Consider Tendai, a young girl in the Lowveld, in Zimbabwe. Her day

starts as 4 a.m. when to fetch water, she carries a thirty litre tin to a
borehole about eleven kilometres from her home. She walks barefoot
and is home by 9 a.m. She eats a little and proceeds to fetch firewood
until midday. She cleans the utensils from the family’s morning meal and
sits preparing a lunch of sadza for the family. After lunch and the clean-
ing of the dishes, she wanders in the hot sun until early evening, fetching
wild vegetables for supper before making the evening trip for water. Her
day ends at 9 p.m., after she has prepared supper and put her younger
brothers and sisters to sleep. Tendai is considered unproductive and eco-

nomically inactive. According to the international economic system,
Tendai does not work and is not part of the labour force.
Cathy, a young, middle-class North American housewife, spends her
days preparing food, setting the table, washing dishes, dressing her chil-
dren, disciplining children, taking the children to day-care or to school,
disposing of the garbage, dusting, gathering clothes for washing, doing
the laundry, going to the gas station and the supermarket, repairing
household items, keeping an eye on or playing with the children, making
beds, paying bills, caring for pets and plants, putting away toys, books,
and clothes, sewing or mending or knitting, talking with door-to-door
salespeople, answering the telephone, vacuuming, sweeping and washing
floors, cutting the grass, weeding, and shovelling snow, cleaning the bath-
room and the kitchen, and putting her children to bed. Cathy has to face
the fact that she fills her time in a totally unproductive manner. She, too,
is economically inactive and economists record her as unoccupied. (13)
The reason these domestic activities do not show up in national ac-

counts, Waring says, has to do with economists’ culturally based notion
that “work” should be part of measures of productivity only if it is paid.
By making unpaid labor invisible, economists are “devaluing” (in the
sense of insufficiently esteeming) such work. Perhaps more importantly,
the lack of imputation results in policies that fail to recognize the signifi-
cance of unpaid labor.
Although Waring discusses such policies in “developing countries,” she
says less about what they might be in industrial societies. I would imagine
that they would include—to give only a few possible examples—divorce
settlements, social security (given only to those with paid work), and in-
surance compensation.
Waring lists several methods for imputing the value of unpaid work.
These methods, mostly derived from market wages, resemble those pre-
viously discussed:
1. the wages of substitute workers who could be hired for performing

productive activities in the household (substitute workers could be
either polyvalent: domestic servants, housekeepers, family aids [sic];
or specialised: cooks, launderers, babysitters);
2. the wages of workers performing tasks similar to those required by
household tasks;
3. the wages of workers performing tasks requiring qualifications similar

to those required by household tasks;
4. wages foregone in the market by those engaged in unpaid household
work (that is, “the opportunity cost” of their time);
5. the average wages of market workers (sometimes differentiated by sex,
age, education, residential area, legal minimum wages, and so on).
(227)
She notes that the computation of the percentage of the contribution

of women to measures of national productivity differ depending on which
method is used. According to Waring, opportunity cost calculations
(“average hourly wage, by sex, of full-time civilian workers, less income
tax”) gives a higher percentage than the replacement value alternative
(“paying another person to carry out all the housekeeping or homemak-
ing or mothering tasks”). The reason for the difference is that the tasks of
the replacement workers are poorly paid. I do not understand how War-
ing can assume, using the opportunity cost method, that women forgo-
ing housework will (as a group) be able to get work that is paid an average
wage. In any case, her results contrast with Delang’s study of the value of
wild plant collection in a Thai village, where the replacement cost method
yields a much higher estimate than the opportunity cost method.
By imputing a value to unpaid labor, Waring is doing exactly what Cha-
yanov warned against. The reason many households in industrial societies
are economically viable is precisely that much labor is unpaid; imputing
a monetary value to such work therefore seems misleading. Nonetheless,
Waring would agree with the use of Chayanov’s term “self-exploitation”
to describe unpaid household labor.
Conclusions
Imputing a monetary value to subsistence production and unpaid labor is

reasonable in societies with cash economies. Many important choices in
such economies require decision makers to weigh the costs and benefits
of paid and unremunerated work. When these decision makers opt for
unpaid work, they are implicitly valuing the net benefits more highly than
alternative paid labor. Because a monetary value can be assigned to paid
work in these circumstances, it is at least plausible that one might be able
to impute a higher value to unpaid options that are deemed preferable.
Furthermore, ignoring unpaid work and subsistence production in na-

tional economic statistics can lead to misleading measures of both the
total production of an economy and the relative contributions of differ-
ent segments of the population. What does it mean, for example, when
the World Bank reports that in 2007 the gross domestic production per
capita in Malawi was US$266? If this figure omits subsistence production
and unpaid labor (as it almost certainly does), an erroneous impression is
given of both the scale of the country’s economy and the importance of
the activities of members of many rural households.
Only two methods are commonly used to impute monetary values
to subsistence production and unpaid labor. The first is to calculate an
opportunity cost—the monetary returns available from alternative paid
work. The second is to calculate a replacement value—the cost of hiring
someone to carry out a particular subsistence activity. As we have seen,
there can be daunting technical difficulties associated with such calcula-
tions. Moreover, the results of the two methods in particular situations
often lead to strikingly different imputations of value.
A more fundamental problem arises when the imputation of monetary
values obscures the economic significance of whether an activity involves
the exchange of cash. Consider, for example, two farms using different
types of labor to raise a cash crop. Farm A uses only unpaid household
labor; farm B employs hired workers. As we have seen, Chayanov noted
many years ago that in some circumstances farm A can operate at a profit
while farm B is losing money. I am not at all sure what it means in such
cases to impute a monetary value to the household labor on farm A. Some
years ago I read a report for the Agency for International Development
in which an economist used the opportunity cost method in cost-benefit
analyses of corn farming in Belize. Using reasoning similar to that of the
economists criticized by Chayanov, he concluded that many households
raising corn using unpaid labor were operating at a loss even though their
income from this crop was greater than what they spent on inputs such
as weed killer, rent, and fertilizer. Although this conclusion struck me as
absurd, the alternative of ignoring the economic value of unpaid work also
seemed unacceptable.
Perhaps the best reason to impute a monetary value to subsistence pro-
duction and unpaid labor is to draw attention to the economic importance
of these activities. Certainly, this can be done rhetorically by stressing
how essential domestic work, volunteer service, and subsistence crops are
to the well-being of all societies. But we live in a world where statistics—
however imperfect they may be—greatly influence states’ allocations of

diverse resources. Furthermore, economic models of household economic
behavior are often used in proposals by government entities and NGOs
to improve the conditions of poor people in both rural and urban areas.
Such models, statistics, and analyses can only be improved by a formal
consideration of the worth of unremunerated work.
CHAPTER 3
Risk, Uncertainty, and Decision Making
How am I supposed to think about consequences before they happen?

New Yorker cartoon caption of a chilD arGuinG
With upSet parentS, november 9, 2009, p. 60
When I bought a new home in early 2009, I was faced with several com-
plicated financial decisions. How much of my savings should I use for a
down payment and how much should I borrow via a mortgage? Should I
take out a bridge loan during the period between the closing date on the
new house and the sale of my current residence? Which assets should I sell
to cover the down payment?
The world economy at the time was in the midst of a severe recession.
The value of my stocks and bonds had dropped precipitously over the
previous year; I had no idea if this plunge would continue. In order to
learn how the tax implications of the market slump might influence my
decisions about paying for the house, I made an appointment with my
accountant. He recommended that we also consult one of his associates
who handled investors’ portfolios. Although the meeting began with a
discussion of taxes, we spent most of our time considering my investment
strategies and plans for retirement. The financial adviser confidently
showed me a complicated chart he had devised that showed the risks and
returns associated with different types of investments over the past thirty
years. His idea was that this chart could be used in conjunction with my fi-
nancial goals to determine how best to pay for my house and make future
investments. My immediate response was to ask the adviser about his ap-
parent assumption that the future would resemble the past. I pointed out
that prominent economists seemed to have no idea about what would be
Risk, Uncertainty, and Decision Making 61
the outcome of the current financial crisis. Why, then, would I want to
base my investments on what had happened in previous decades? The ad-
viser could not give a reassuring response to my query and could only say
that economic conditions at this time seemed unusually uncertain.
The type of question I raised was not at all unusual. Almost every deci-
sion that human beings make is affected by the unpredictability of future
events. In the early twentieth century, the economist Frank Knight ar-
gued (1921) that such decision-making situations could be characterized
as either “risky” or “uncertain.” In risky situations, decision makers can
estimate the probabilities of different outcomes resulting from particular
decisions. In uncertain situations, decision makers have no idea what the
probabilities are of different outcomes. In the real world, however, most
decisions-making situations combine elements of both risk and uncer-
tainty. Decision makers often have vague ideas about what the odds are
of different outcomes but are unable to make even ballpark estimates of
probabilities. My house financing choices, for example, seemed to fall in
the middle of a risk-uncertainty continuum.
In this chapter I explore approaches that economists, cognitive psy-
chologists, and anthropologists have taken toward analyzing decision
making in situations of risk and uncertainty. Perhaps because of con-
ceptual problems, economists and psychologists usually either ignore
or downplay Knightean uncertainty when examining decision making.
Anthropologists have taken diverse approaches to risk and uncertainty.
Some ethnographers have attempted to employ the theoretical models of
economists and the findings of laboratory experiments of psychologists
in their analyses of decision making in real-world settings. Most anthro-
pologists, however, reject the approaches of economists and psychologists
as being unrealistic. Even in situations of low uncertainty when risks can
be quantified to some extent, the models of economists and psychologists
seem to these anthropologists to be largely irrelevant to the activities of
most people making complicated decisions.
Before discussing more thoroughly different theoretical approaches to
risk and uncertainty, I present in some detail three examples of decision
making drawn from my fieldwork. Although these case studies omit or
gloss over many of the complex factors influencing choices, they provide
sufficient ethnographic material with which to assess the advantages and
shortcomings of varied theoretical approaches to risk and uncertainty.
No-Till Farming in Iowa, 1982
During the early 1980s I conducted research on decisions about the adop-
tion of no-till farming techniques in Van Buren County in southeastern
Iowa (Chibnik 1987). No-till is an important soil conservation measure
that had been recently introduced to the Midwest. Farmers using this
technique in Iowa plant corn or soybeans in previously unprepared soil
by “opening a narrow slot, trench or band of sufficient width and depth to
obtain proper seed coverage” (Choi and Coughenour 1979:1). The use of
herbicides enables farmers to control unwanted weeds and grasses with-
out turning the soil.
At the time of my research, no-till was receiving extensive publicity in
Iowa. The Des Moines Register, the state’s leading newspaper, and maga-
zines including Wallaces Farmer and Successful Farming ran articles about
the technique. No-till yield contests were regular features of state fairs.
This publicity led farmers to be increasingly willing to experiment with
no-till. Van Buren County was one of the most active no-till areas in the
state. Although there were no more than a dozen no-tillers in Van Buren
County in 1978, by 1982 the local Soil Conservation Service estimated that
20 to 30 percent of the county’s 1,100 farmers had some acreage in no-till.
Iowa farmers were experimenting with no-till because of its potential
as an effective soil-saving technique that might also reduce labor time and
fuel costs. In the 1980s, severe soil erosion problems were threatening
the prominence of midwestern corn and soybean farming. Many farms
had lost half their original topsoil. Despite deteriorating soils, farmers
had been able to increase corn and soybean yields by applying massive
amounts of fertilizers, herbicides, and pesticides. These energy-intensive
practices, however, had become less cost- effective as the price of fossil
fuels soared and gains in productivity leveled off. Furthermore, the ex-
tensive use of chemical fertilizers had caused soil damage. Besides these
on-farm costs, soil erosion was causing off-farm environmental problems
such as the silting of reservoirs and streambeds and the deterioration of
water quality.
Technological and macroeconomic changes had caused some farmers
to become dissatisfied with older soil conservation practices. Large trac-
tors could not be operated easily on fields with intricate systems of con-
tours, terraces, and shelter belts. Expanding markets and soaring land
values (with consequent higher rents and taxes) led farmers to shorten
crop rotations and plow under pastures and woodlands.
The search for new conservation methods led many farmers to attempt
to control erosion with reduced tillage systems. These systems minimally

disturb the soil during seedbed preparation and subsequent weed control.
Although some writers several decades earlier (such as Faulkner 1943) had
recommended that farmers reduce or abandon plowing to preserve soil,
such a change was not practical at the time because of the absence of effec-
tive nonmechanical methods of weed control. Chemical research after the
end of World War II, however, enabled the development of better herbi-
cides and pesticides. These new chemical compounds better distinguished
between crops and weeds, and they provided greater effects per gram of
material applied. No-till, the most radical of the various reduced tillage
systems, essentially consists of the substitution of chemicals for plows.
Because no-till eliminates plowing and cultivation, farmers switching
partly or entirely to this technique can save considerably on labor. Such
time saving was particularly useful for part-time farmers and dairy and
feedlot operators whose fieldwork was a sideline for their main enterprise
of raising animals. The equipment required for no-till differs somewhat
from that used in conventional midwestern agriculture. Special planters
or attachments to conventional planters are needed to penetrate barriers
of dead organic material and place seed in the soil. The absence of plows,
disks, harrows, cultivators, and other heavy equipment used in turning the
soil allows no-till farmers to use considerably smaller tractors than those
employed in conventional tillage.
Farmers adopting no-till are able to reduce fuel expenses consider-
ably because they spend less time with machinery in the field. If no-till is
adopted entirely, there is a fuel saving through the use of smaller tractors.
However, overall, no-till may not save money. Most farmers combine no-
till with plow agriculture; as a result their expenditures on machinery
are higher than if they used only one of these techniques. Energy savings
from fuel are usually counterbalanced by increases in the cost of purchas-
ing and applying chemical herbicides and pesticides. Because no-till soy-
beans ordinarily require a greater application of weed killers than no-till
corn, the cost per acre of no-till soybeans is usually somewhat higher than
when that crop is conventionally grown.
No-till farming has several disadvantages. The extensive use of her-
bicides may endanger the health of farmers and result in chemical pol-
lution of the water table, rivers, and streams. Chemicals may change the
physiology and development of crops so they become more susceptible
to pathogens present in low levels in the field. Weeds resistant to the
chemicals in herbicides have evolved. Besides these environmental risks,
no-till can be difficult logistically. In comparison to conventional farm-
ing, no-till requires a greater knowledge of soil characteristics and the

proper application of chemicals. Furthermore, the reduction in the num-
ber of passes over a field gives no-till farmers few opportunities to correct
mistakes.
Early adopters of no-till confronted numerous risks and uncertainties.
When farmers plant a crop using a time-tested technique, their situation
with respect to yields usually falls near the risk end of a risk-uncertainty
continuum. Although such farmers may not know how well their crops
will do, they have some notion of the probabilities of good, fair, and poor
yields in any particular time and place. When Van Buren County farmers
first tried no-till, however, their situation was closer to the uncertainty
end of the continuum. They soon discovered that no-till yields were more
variable than those of conventional crops.
Farmers often found that incomplete weed killing resulted in low
yields of no-till corn and, especially, soybeans. Weeds were particularly
problematic when farmers or hired sprayers had an inadequate knowledge
of proper methods of chemical application. Weeds also turned out to be
troublesome under certain climatic conditions. During cold springs, no-
till crops emerged later than those planted conventionally and were not as
able to compete successfully with fast-growing weeds. Because activation
of most herbicides requires water, in dry years no-till farmers ran risks of
incomplete weed killing and of herbicide residues.
Farmers learned from soil conservation officials, agricultural maga-
zines, and their neighbors’ and their own experiences that no-till was
especially risky for certain crops, soil types, and topographies. No-till
works better for corn than soybeans because of the greater amount of
weed control required for the latter crop. Many tillable acres in Iowa (43
percent, according to Cosper 1983) turned out to have soils unsuited for
no-till. Drainage problems led many Van Buren County farmers to avoid
using no-till in flatlands susceptible to flooding.
Although many Van Buren County farmers were concerned about the
long-term dangers of soil erosion and the health risks of excessive use
of herbicides and pesticides, their agricultural decisions were primarily
motivated by monetary considerations. Yield variation was the most im-
portant risk affecting the relative profitability of no-till and conven-
tionally grown crops. Not entirely predictable differences in input costs
were also relevant. No-till farmers were particularly affected by changing
prices of herbicides and pesticides; variations in fuel prices were more im-
portant for conventional cultivators.
Agricultural Credit in the Peruvian Amazon, 1986
In the mid-1980s I conducted more than a year of research among people

living in floodplain communities along the Amazon River near the Peru-
vian city of Iquitos (Chibnik 1994). Slow boats are the only means of
transportation between these communities and Iquitos. Most villagers are
descendants of local indigenous peoples and immigrants who came into
the area during the rubber boom between 1870 and 1910. These ribereños
are mostly monolingual in Spanish and do not self-identify as Indians.
The overall standard of living was low in the communities where I did
fieldwork. More than one in every ten children died before the age of two.
The mean annual household income in three villages where I conducted
surveys was about 7,000 intis (US$500). Ribereño livelihoods depended
primarily on farming and fishing. Their principal foods were manioc
( yuca) and plantains. Rice was the most important cash crop. There was a
sizable demand for rice among the residents of Iquitos, where a govern-
ment buying center provided a guaranteed market and price.
One of my projects involved looking at how ribereños made decisions
about whether to get state-sponsored agricultural credit for rice produc-
tion (Chibnik 1990, 1994:173–191). Most rice was grown on small plots in
mud deposits that appear annually when the Amazon River falls. Because
these deposits follow the ever-changing course of the river, they are im-
permanent. Every year new ones form and land that was once mud flats
remains underwater.
Although there were varied expenses associated with rice cultivation,
the most important cost (about half of total monetary outlays) was for
harvesting labor. Ribereños grew yuca and plantains using household
labor and cooperative work groups (mingas). These crops are grown year-
round on land types that flood either occasionally or not at all. With little
monthly variation in rainfall and temperature in this part of Amazonia,
labor demands for harvesting for yuca and plantains were evenly distrib-
uted over the course of a year and never high. Rice harvesting, in contrast,
had to be done in a short window of time before the river covered mud
flats. On plots of more than half a hectare, household labor was insuffi-
cient for harvesting. Cooperative work groups were difficult to mobilize
because numerous households were harvesting simultaneously. There-
fore, harvesting large crops of rice required hired labor.
For many years, rice farmers seeking loans had to rely on rural money
lenders (habilitadores) who charged high rates of interest. In the 1970s the
state began making rice loans available through the Agrarian Bank.1 The
process of getting a loan was time-consuming and costly. Farmers had to
obtain separate loan approvals for specific activities such as land clear-
ing, weeding, and harvesting. Borrowers had to travel to branches of the
Agrarian Bank in Iquitos or elsewhere to get an entire season’s loan ini-
tially approved and to receive approvals for each loan portion. Because
most villages were from five to fifteen hours by boat from the nearest
branch of the Agrarian Bank, trips to get loan approvals involved a stay of
at least one night away from home. Limited hours (nine in the morning to
noon, five days a week), crowded conditions, and slow service at the bank
often resulted in delays of several days.
Farmers ordinarily did not know what the bank’s credit policies would
be in the coming year. The bank made little effort to disseminate informa-
tion about these policies, which often changed. Ribereños received most
of their information about bank policies from a regional rice producers
organization.
The fundamental risk that rice producers encountered when they
took agricultural credit was that their net incomes from sales would be
less than the cost of their loans (principal plus interest plus travel costs).
Because prices were guaranteed, profits depended mostly on rice yields.
There were two principal reasons rice yields were sometimes unaccept-
ably low. In some years farmers were unable to complete harvesting be-
fore the river rose. In other years farmers were unable to pay off loans
taken out before the agricultural cycle began when they were unable to
gain access to sufficient good land. This occurred most often when many
mud deposits were not inundated after the river rose, leaving much of the
land weed-covered.
Farmers unable to repay loans found themselves in a precarious eco-
nomic position. Although amnesties were sometimes given after regional
disasters, indebted farmers were ordinarily forbidden to take out new
loans from the Agrarian Bank. They were forced to borrow from habili-
tadores. Furthermore, when heavily indebted farmers sold rice to state
buying centers, they did not receive cash. Instead, their debts were re-
duced by the value of the rice sold. Habilitadores sometimes took advan-
tage of this government policy by buying rice at low prices from indebted
farmers needing money immediately and reselling it to buying centers at
higher prices.
A research assistant and I interviewed twelve farmers about their ex-
periences with rice loans from the Agrarian Bank. These farmers had
taken out a total of ninety-one such loans between 1970 and 1985. Of
these loans, sixteen (18 percent) were not paid back when due, and in all
but three of these cases insufficient rice production was the reason for the
loan default. While these data do not allow more than a tentative estimate
of the probability of a loan default because of insufficient production,
they suggest that the chance of this occurring was considerable. Even if in
most years the probability of a loan default was low, simple mathematical
calculations show that a regular borrower was likely to default eventually.2
All but one of the twelve rice growers interviewed had defaulted at least
once. Furthermore, even those borrowers able to repay loans often lost
money or made minuscule profits.
Because the chances of poor rice yields in mud flats can be roughly esti-
mated, obtaining agricultural credit might have seemed to fall on the risk
side of a risk-uncertainty continuum. Taking out rice loans appeared to
be a calculable risky strategy that most farmers would be likely to avoid.
Such an analysis, however, ignores a major motivation for seeking rice
loans. Farmers often borrowed in order to insure against economic or
medical setbacks or to even out seasonal fluctuations in cash. Ribereños
sometimes deliberately took out loans to pay for routine household main-
tenance; at other times they were forced by emergencies to divert money
away from producing and marketing rice. If loans were repaid on time, the
Agrarian Bank might not monitor their use. Even when farmers used so
much credit for household expenses that loan repayment was impossible,
indebtedness to a bank was sometimes regarded as preferable to borrow-
ing from an habilitador.
The conventional wisdom about “peasant risk-aversion” (such as Ortiz
1973, Scott 1976) was therefore of only limited use in understanding ri-
bereños’ willingness to seek rice loans from the Agrarian Bank. Farmers
in the floodplain communities wanted to make money, avoid long-term
indebtedness, and ensure a steady food supply and medical care for their
families. Rice loans increased the probability of both significant monetary
profits and long-term indebtedness. Credit provided insurance against
starvation and medical disasters. Obtaining rice credit thus increased cer-
tain types of risk and decreased other types of risk. Farmers differed in
the extent to which they weighed these varying types of risk (and uncer-
tainty) when making decisions about whether to take out loans from the
Agrarian Bank.
Oaxacan Wood Carvers, 1998
Since 1994 I have been conducting research on the sale of wood carvings
(alebrijes) from the Mexican state of Oaxaca in the global folk art market
(Chibnik 2003). Even the most casual tourist in the city of Oaxaca, the
state capital, can see that craft production is an integral part of the local
economy. Visitors to the historic center pass shop after shop featuring the
regions’ artisans. Tours visit villages where pottery, weavings, and textiles
are made. Vendors in squares and markets hawk handmade rugs, earthen-
ware, tin ornaments, wall hangings, and cloth and leather belts. Few tour-
ists realize that their purchases are only a small part of the local trade in
arts and crafts. The livelihoods of most rural potters, weavers, and wood
carvers depend primarily on sales to intermediaries from Mexico, Europe,
Japan, Canada, and, most importantly, the United States.
My research has focused on the activities of carvers in two communi-
ties, Arrazola and San Martín Tilcajete. In the 1970s and early 1980s these
artisans sold their pieces mostly to store owners in the city of Oaxaca.
Wood carving during this period was ordinarily a part-time occupation
for a few adult males; women and children occasionally helped with paint-
ing and sanding. In the mid-1980s, wholesalers and store owners from the
United States began to visit Arrazola and San Martín to buy carvings.
Wholesalers could earn significant amounts of money by selling carv-
ings in the United States at three to six times their cost in Mexico. Carv-
ings became more complicated and paint jobs more ornate as artisans
competed to show their skills. The craft since then has been a family
activity in which the typical, although not universal, division of labor is
women painting and men carving and also doing some painting. Children
often help out with various tasks, most importantly sanding. Adult men
do less than half the work on many carvings.
The wood-carving boom of the 1980s and 1990s had dramatic effects
on the economies of Arrazola and San Martín. In Arrazola some fami-
lies abandoned agriculture altogether and worked as full-time carvers.
Although most carving households in San Martín continued to farm,
agriculture became a secondary, subsistence- oriented activity. Despite
artisans’ success selling wood carvings during these years, in both com-
munities significant numbers of people migrated temporarily or perma-
nently to the United States. At the beginning of this century, sales of
cheap wood carvings dropped dramatically, and many low- end artisans
stopped making pieces. There remained a good market for more expen-
sive alebrijes.
My most intensive fieldwork took place in the late 1990s, when the
market for all Oaxacan wood carvings was still strong. An important part
of my research was determining how and why people in households in-
volved in the trade in alebrijes allocated their time among wood carving,
wage labor, schooling, and migration to the United States and elsewhere.
To a certain extent, these decisions were made by individuals weighing the
costs and benefits of different options. But these choices were also in part
family decisions influenced strongly by discussions among adult members
of households.
The economic goals of Oaxacan wood-carving households were more
ambitious than those of the Peruvian ribereños with whom I had worked
in the 1980s. Ribereños were primarily motivated by their desires to en-
sure a steady food supply for their families and to have money in case
of medical emergencies. Oaxacan wood carvers, in contrast, aspired—
usually in vain—to a middle-class standard of living including automo-
biles, diverse electronic devices, and good educations for their children.
They compared their economic situation not only with other Oaxacans
but also with their relatives and friends who had migrated (usually without
legal documentation) temporarily or permanently to the United States.
With the exception of migration to the United States, wood carving
was clearly the most promising short-term economic option in the late
1990s for families in Arrazola and San Martín. The returns per labor day
were markedly higher than those from wage labor and crops such as corn,
beans, garlic, and onions. The demand for alebrijes was sufficiently high
that wood carving was not particularly risky if families had artisans of
average talent. Even the cheapest and simplest pieces could be sold to
visiting tourists, store owners in Oaxaca, and folk art dealers from the
United States. Children, the elderly, and mothers of young children who
lacked either the time or the ability to work at full-time wage labor could
help out with wood carving.
Why, then, were there many people in Arrazola and San Martín who
did not participate in the wood- carving boom? Why did many wood-
carving families continue to devote considerable time to growing corn
and beans? Some people either did not enjoy making alebrijes or lacked
talent for carving and painting. Long-term considerations of risk and un-
certainty, however, were the primary reasons families often encouraged
certain members to migrate, stay in school, or pursue economic activities
other than wood carving. Oaxacan artisans in the late 1990s thought (cor-
rectly) that the market for alebrijes would worsen fairly soon. If every-
one in a family specialized in painting and carving alebrijes, their tal-
ents would all be economically useless in a few years. Furthermore, only

the most successful wood-carving families had a standard of living that
approached middle-class. Families with members of diverse skills might
therefore do better in the near future than those where everyone worked
on wood carvings.
Although farmers suffered from frequent droughts and were able to
earn only small amounts of money even in years when the weather was
good, many rural Oaxacan families were even in the short term reluctant
to abandon the limited food security made possible though growing corn
and beans. Farmers could ordinarily retain access to their fields (available
via complex rules of communal land tenure) only if they continued to
cultivate them. Such access was a form of subsistence insurance if wood-
carving sales fell.
The two principal alternatives to wood carving that young men and
women considered were obtaining secondary (in some cases also univer-
sity) education and migration. The potential upside to both these choices
was greater than that for wood carving. Education could lead to com-
fortable jobs in government or business. Migration offered possibilities
of earning salaries that were orders of magnitude greater than those in
Oaxaca. Many families in Arrazola and San Martín received some money
from relatives in the United States.
Rural Oaxacans knew, however, that investments in education and mi-
gration did not always pay off for either participants or other family mem-
bers. Time spent away from a community could result in a loss of labor
on wood carving. This was ordinarily not a serious problem; there were
usually family members who could paint or carve in place of those un-
available because of studies or migration. More importantly, neither edu-
cation nor migration was a sure path to the middle class. Mexico has many
educated people working at menial jobs. This is especially noticeable in
Oaxaca, one of the poorest states in the country. Migrants to the United
States who were able to cross the border (usually not a problem) some-
times could get only intermittent, poorly paid employment. Even when
migrants obtained steady work (most I met were able to do this), there was
great variation in how much money they sent home.
The most risk-averse household economic strategy in both the short
term and the long term therefore involved a combination of wood carv-
ing, agriculture, wage work, education, and migration. Wood carving,
wage work, and agriculture provided food and income in the short term.
The other activities had the potential for greater incomes in either the
near future (migration) or the long run (education).
Common Themes
Iowa farmers experimenting with no-till, Peruvian ribereños taking out

loans from the Agrarian Bank, and rural Oaxacans allocating household
labor all had to cope with the unpredictable consequences of their choices.
Although the ethnographic details of these examples vary, they share cer-
tain features that illustrate why simple models often fail to capture the
complexity of decision making in situations of risk and uncertainty. In
each of these cases decision makers must consider diverse risks, make
choices that differ in their positions on a risk-uncertainty continuum, and
take into account both short-term and long-term implications of their ac-
tions. Furthermore, the potential costs and benefits of alternative choices
cannot always be easily measured.
There are two important similarities in the ways in which the decision
makers described here (and many others in different places and times) re-
spond to situations of risk and uncertainty. Iowa farmers, ribereños, and
Oaxacan artisans diversified their activities in order to reduce the chances
of disastrous consequences resulting from the economic choices. They
all also attempted to convert uncertainty into risk through information
gathering and small-scale experimentation.
Multiple Risks and Uncertainties
Most choices involve multiple risks and uncertainties. Iowa farmers choos-
ing between no-till and conventional methods had to consider yield varia-
tions, potential input costs, and the chances of health problems resulting
from the use of chemicals. Ribereños weighing the possibility of taking
out a loan were influenced by flood patterns, inflation, and the chances of
family members incurring medical expenses. Oaxacan artisan households
considering different types of work had to contend with an unpredict-
able market for crafts, the perils of being undocumented laborers in the
United States, and a volatile Mexican economy that limits opportunities
for educated people.
Individuals differ in the weights they place on the importance of the
various risks and uncertainties associated with particular choices. More-
over, analyzing the risks and uncertainties of variables such as yields,
costs, and prices is enormously complicated. The risk and uncertainty
of corn yields in Iowa, for example, arises from yearly variations in tem-
perature, rainfall, weeds, pests, and a host of other factors. Farmers’ ideas
about yield risks cannot be captured merely by examining “objective” his-
torical records of fluctuations in corn production. Instead, farmers’ sub-

jective perceptions of risk and uncertainty are influenced by their ideas
about the myriad underlying causes of such variations.
Variability in the Extent to Which Risks Can Be Estimated
The decisions presented in the case studies took place in contexts that
were quite different from Knight’s situations of “pure risk” in which the
probabilities of different outcomes are known. Instead, they all fell some-
where on a risk-uncertainty continuum. Some variables (corn yields with
conventional farming in Iowa, flood patterns in the Peruvian Amazon)
were closer to the risk end of the continuum because of historical records
and the reasonableness of assumptions that the future would resemble the
past. But even in these cases decision makers could only provide rough
estimates of the chances of different outcomes. Many other factors affect-
ing the decisions described here are closer to the uncertainty end of the
continuum. These included variability of no-till soybean yields on flat-
lands in Iowa, the chances of a member of a ribereño family being bitten
by a snake, and the odds that a large-scale buyer of folk art would like a
new creation by a Oaxacan wood carver.
Short-term and Long-term Considerations
The potential risks, uncertainties, costs, and benefits of alternative

choices in the short term may differ from those in the long term. This
can be seen most clearly in the Oaxaca example, where short-term payoffs
from wage labor, farming, and artisanry must be weighed against poten-
tial longer-term payoffs from migration and schooling. Although farm-
ing, wage work, and artisanry are clearly less risky in the short term than
migration and education, this may well not be the case in the long run.
Ribereño borrowers and Iowan farmers are also influenced by both
short-term and long-term considerations of risk and uncertainty. Perhaps
counterintuitively, taking out credit is probably safer in the short term for
ribereños than concentrating only on crops that can be grown without
loans. Borrowing ensures the ability to hire labor when needed, enables
a greater diversity of economic activities, and provides money in case
of medical emergencies. In the long run, borrowing may be the riskier
strategy because of the likelihood of floods leading to defaults that place
ribereños in untenable economic situations. Iowa farmers experimenting
with no-till may initially have poor yields because of their unfamiliarity
with the technique. The soil conservation made possible by no-till, how-
ever, may make this farming method preferable to conventional agricul-
ture in the long run for particular crops on certain types of land.
Incommensurability of Costs and Benefits
Estimating the risks and uncertainties of alternative choices entails cal-

culating diverse potential costs and benefits. These costs and benefits can
be difficult to measure. Even when measurement is relatively straightfor-
ward, the costs and benefits may not be easily comparable. Iowa farmers
adopting no-till must think about the potential income from corn and
soybeans grown using the new technique, the health risks resulting from
greater exposure to chemicals, and the satisfaction gained from preserv-
ing soil for future generations. Ribereños taking out loans weigh the risk
of defaulting, the chances of improving their standard of living, and the
peace of mind provided by greater ability to cope with medical emer-
gencies. Young Oaxacan men considering migration to the United States
must consider the chances of finding jobs, the dangers of crossing the
border, and the loneliness of being away from their families. Attempts
to convert these diverse costs and benefits into a single measurable unit
such as money, while tempting for their analytic convenience, may well
be unrealistic.
Strategies for Coping with Risk and Uncertainty
Many social scientists (among them Netting 1993:33, Scott 1976:24) have
observed that diversification of economic activities is a common, useful
strategy for reducing risk and uncertainty. The idea is that people who en-
gage in several activities will have something to fall back on if problems
arise with one of their sources of food and income. This is codified in folk
wisdom in the adage “Don’t put all your eggs in one basket.”
The three cases presented here provide further evidence of the ubiq-
uity of diversification to avoid risk. Many rural households in Iowa in 1982
split their land between no-till and conventional crops and also took off-
farm work. Ribereño households borrowing money from the Agrarian
Bank in 1986 to hire laborers to help with the rice harvest also fished,
collected fruit, and grew corn and manioc using family labor. Oaxacan
artisan households in 1998 raised subsistence crops, made wood carvings,
worked as wage laborers, and migrated temporarily to the United States
or other parts of Mexico.
In an article I wrote some years ago (Chibnik 1981), I argued that de-
cision makers often take actions to make costs more risk-like and less
uncertain-like. These actions, I suggested, commonly take the form of
low-cost (in time or money), small-scale experimentation and informa-
tion gathering. Although I thought at the time that this was an original
observation, I now know that a few economists had already reached this
conclusion. K. E. Warner (1974), for example, had made essentially the
same argument in the context of the adoption of innovations. He pointed
out that when possible, potential adopters seek information about the cost
and value of an innovation via their own and others’ experiments. (Marra,
Pannell, and Ghadim 2003 and Rogers 2003 review more recent work on
this topic.) Iowa farmers talked to their neighbors about no-till, ribereños
attended meetings about credit organized by the leaders of rural unions,
and Oaxacan artisans asked their relatives about the sales of new types of
carvings.
The examples presented here suggest that detailed ethnography is nec-
essary to understand the complex considerations that influence decisions
in situations of risk and uncertainty. In what follows, I show that the great
majority of economists and psychologists ignore such complexity, instead
creating radically simplified models of choice. Although most anthro-
pologists take a nuanced ethnographic approach, some prefer the more
mathematically tractable treatments of risk and uncertainty by econo-
mists, psychologists, and ecologists.
Disciplinary Approaches to Risk and Uncertainty
Economists
Economists have written extensively about the definition and measure-

ment of “risk.” Some see risk primarily in terms of the variability of out-
comes possible when a particular choice is made. A farmer planting corn,
for example, knows that yields and prices vary from year to year. These
economists define risk mathematically by empirical measures of vari-
ability using statistics such as the standard deviation. Other economists,
such as Nassim Nicholas Taleb, place more emphasis in certain situations
on the chances of a disastrous outcome.3 Poor corn farmers might be
especially concerned about a harvest being so bad that they will be unable
to feed their families. In such cases, a definition of risk might rest on the
probability of a harvest being unacceptably low.
Some economists have used sophisticated models (Meyer and Meyer

2006) to describe and analyze situations in which decision makers are
concerned with both variability and the chances of a disastrous out-
come. They deploy complicated mathematical equations to describe risk-
aversion preferences of individual decision makers such as farmers or
investors. Eliciting risk-aversion attitudes in a form amenable to mathe-
matical modeling is hardly straightforward. Many models combine in-
formation from interviews and untested assumptions about “rational
behavior.”
Most economic models of decision making in risky and uncertain
situations are based on expected utility theory. Such models assume that
probabilities can be assigned to the likelihood of different outcomes re-
sulting from a particular choice. Some analyses calculate these proba-
bilities from “objective” data about what has happened in the past (such
as crop yields over several years). Other analysts adopting a “Bayesian ap-
proach” base their models on “subjective” probabilities of different out-
comes elicited by interviewing decision makers. Economists have often
noticed (for example, Smith and Mandac 1995 on Philippine farmers’ esti-
mates of future rice yields) that subjective and objective probabilities can
differ considerably. They conclude that decision makers acting on sub-
jective probabilities often choose suboptimal options, given their risk-
aversion preferences.
Diverse methods have been used in attempts to determine risk-aversion
preferences and subjective probabilities (Meyer and Meyer 2006; Marra,
Pannell, and Ghadim 2003). A typical question about risk-aversion pref-
erences might ask stock investors if they prefer either a certain return
of 6 percent annually or a 90 percent chance of a 20 percent return and
a 10 percent chance of a 50 percent loss. A typical question about sub-
jective probabilities might ask Iowa farmers what they think the chances
are of their corn yields being between 150 and 200 bushels per acre. The
assumption is that sufficiently careful questioning along these lines will
allow the construction of realistic models of decision making.
A recent summary of the state of the art on risk aversion (Meyer and
Meyer 2006) shows well how the work of economists—almost impene-
trable to outsiders—has resulted in only the most meager conclusions.
The authors, Donald Meyer and Jack Meyer, conclude after many pages
of definitions, assumptions, and differential equations that
any measure of risk aversion for a decision maker is specific to the par-
ticular outcome variable over which the measure is defined or estimated.
Even small changes when defining or measuring an outcome variable

can significantly alter the risk aversion function representing the deci-
sion maker’s risk preferences. All statements concerning the magnitude,
slope, or any other property of a risk aversion measure must implicitly
or explicitly identify the outcome variable to which the statement ap-
plies. (91)
Putting this in plain English is not simple. Readers must understand that
the models under discussion all assume that decision makers are con-
cerned with only one aspect (“the outcome variable”) of a decision. That
is, they regard the multiple aspects of risk considered by decision makers
such as Iowa no-till farmers, Peruvian borrowers from the Agrarian Bank,
and Oaxacan wood carvers as too complex to be mathematically modeled.
Furthermore, these models all assume that the decision-making situation
falls at the absolute risk end of a risk-uncertainty continuum with known
probabilities of different outcomes. Even with such unrealistic assump-
tions, Meyer and Meyer find that the precise definition of the “outcome
variable” (examples given include wealth, income, and “rate of return”)
greatly influences models’ predictions of the risk-taking propensities of
decision makers such as investors or farmers.
Meyer and Meyer reach only one substantive conclusion from their
painstaking survey of the relevant literature on risk aversion. They find—
given a host of assumptions and definitions—that wealthy people are, on
the whole, more willing to take risks than less wealthy people. This unsur-
prising finding seems a puny payoff for economists’ many mathematical
models and empirical studies.
Economists analyzing decision making when outcomes are variable
ordinarily ignore Knightean uncertainty (Taylor 2003:254). This neglect
reflects the inadequacy of mathematical tools to model behavior in the
face of uncertainty. Taylor observes that as we move from risk to uncer-
tainty, it becomes “more and more difficult to conceptualize and define
random variables,” adding that “even the traditional notion of a sharply
defined random variable as a way of modeling an uncertain system is prob-
lematic” (253).
Even the best decision makers apparently do not know how they should
act in uncertain situations. During the worldwide economic crisis of
2008–2009, economists often noted the problems uncertainty caused for
investors. The chief economist of the International Monetary Fund com-
mented in The Economist in early 2009 that
[f ]rom the . . . index of stock market variability . . . to the dispersion

of growth forecasts, even to the frequency of the word “uncertain” in
the press, all the indicators of uncertainty are at or near all-time highs.
What is at work is not only objective, but also subjective uncertainty,
or what economists, following Chicago economist Frank Knight’s early
twentieth century work, call “Knightean uncertainty.” Objective un-
certainty [Here Blanchard is writing about what I am calling “risk.”] is
about what Donald Rumsfeld (in a different context) referred to as the
“known unknowns.” Subjective uncertainty is about the “unknown un-
knowns.” When, as today, the unknown unknowns dominate, and the
economic environment is so complex as to appear nearly incomprehen-
sible, the result is extreme prudence, if not outright paralysis. (Blan-
chard 2009)
Because their mathematical toolkits are unable to model, describe, or pre-

scribe the behavior of decision makers in uncertain situations, economists
unsurprisingly have written little about this topic. As Jens Beckert ob-
serves (1996:813), most economists reinterpret situations of uncertainty
as situations of risk in the sense that the individual decision maker has the
information to make probability calculations.
A few economists such as C. Robert Taylor (2003) understand that many
decision-making situations should be placed along a risk-uncertainty con-
tinuum. This recognition rarely leads to their employing realistic models
in their analyses. The problems again are both mathematical and concep-
tual. Taylor aptly comments that “the topology between these two pre-
cisely defined extremes [pure risk and pure uncertainty] is blurred at best
and filled with epistemological gaps at worst . . . [T]here is a spectrum of
increasing fuzziness as we move toward pure uncertainty” (253).
John Maynard Keynes is the most famous economist who has con-
sidered how decision makers act in situations when some uncertainty is
present. The recent economic crisis led the New York Times Magazine to
run an article in December 2008 on Keynes’s ideas about uncertainty in
which Robert Skidelsky notes:
Then, as now, economists believed that all uncertainty could be reduced

to a measurable risk . . . By contrast, Keynes created an economics whose
starting point was that not all future events could be reduced to a mea-
surable risk. There was a residue of genuine uncertainty, and this made
disaster an ever-present possibility, not a once-in-a-lifetime “shock.” In-
vestment was more an act of faith than a scientific calculation of proba-

bilities. (21)
In such situations, Keynes thought that investors relied on what he

called “conventions.” These conventions include assumptions that the
future will be like the past and that current prices correctly indicate
“future prospects.” Another convention, perhaps not altogether consis-
tent with the previous two, was “running with the crowd.” According to
Keynes, in situations of uncertainty investors do not process informa-
tion efficiently because they are unaware of which information is relevant.
This leads to what economists later called the “herd mentality.”
Cognitive Psychologists
Starting in the late 1960s, cognitive psychologists have shown that (at least
in laboratory experiments) human beings are not very good at making
the probabilistic judgments required by expected utility theory. Daniel
Kahneman shared the 2002 Nobel Prize in Economics for studies along
these lines, many of which he carried out with his longtime collabora-
tor Amos Tversky, who died in 1996. Kahneman and Tversky (1982a:3)
showed that experimental subjects systematically err in making proba-
bility judgments because they engage in certain shortcuts (heuristics)
to simplify decision making. Such heuristics bear some resemblance to
Keynes’s conventions. Two of the most important heuristics are represen-
tativeness and availability. Decision makers using the representativeness
heuristic assess the probability that an object is a member of a particular
category by judging how similar the object is to what they perceive to be
an ordinary member of that category. In so doing, they often pay too little
attention to base rates, the relative sizes of different categories. In a typical
experiment, Kahneman and Tversky (1982b:49) presented subjects with
a list of nine fields of graduate study and information about the percent-
age of students in each field (the base rates). They then gave the subjects
a personality sketch of “Tom” that fit stereotypical ideas at the time about
computer scientists. Tom was said, for example, to have “a need for order
and clarity” and “little feel and little sympathy” for other people. Sub-
jects were then asked to estimate the probability that Tom was a student
of computer science. Their estimates were based mostly on the person-
ality sketch; the highly relevant base rate information was largely ignored.
When the availability heuristic is used, decision makers judge proba-
bilities by how readily they can think of examples fitting various possi-
bilities. The availability of such examples is affected by numerous factors,

including personal experiences and media publicity. For instance, studies
(such as Combs and Slovic 1979) have shown that people in the United
States commonly make mistakes in estimating the relative proportions of
accidental deaths by fire and drowning. Because fires are more spectacu-
lar (“vivid” in the terminology of cognitive psychology) and more likely
to be given prominence in the media, people overestimate the propor-
tion of deaths from fire and underestimate the proportion of deaths from
drowning.
Cognitive psychologists have found in laboratory experiments that the
way in which probabilities in a situation are described (framed) influences
decision making. In perhaps the most famous example, Kahneman and
Tversky asked subjects the following question:
Imagine that the U.S. is preparing for the outbreak of an Asian disease
which is expected to kill 600 people. Two alternative programs to com-
bat the disease have been proposed. Assume that the exact scientific esti-
mates [How can an estimate be “exact”?] of the consequences of the pro-
grams are as follows: If Program A is adopted, 200 people will be saved.
If Program B is adopted, there is a one-third probability that 600 people
will be saved and a two-thirds probability that no people will be saved.
Which of the two programs would you favor? (1984:343)
Most subjects (72 percent) chose Program A. Kahneman and Tversky

then presented identical options to the subjects but framed the proba-
bilities differently:
If Program C is adopted, 400 people will die. If Program D is adopted,

there is a one-third probability that nobody will die and a two-thirds
probability that 600 people will die.
When the options were framed in this way, Program C (identical to Pro-
gram A) was chosen by only 22 percent of the subjects.
Kahneman and Tversky developed “prospect theory” in an attempt to
describe how human beings employ subjective probabilities in their deci-
sion making. Prospect theory is a modification of expected utility theory
(Baron 2008:262 gives details). It maintains the basic idea of expected
utility theory that choices are based on decision makers’ comparisons of
the product (multiplication) of the subjective probability of particular
outcomes and the utility of those outcomes. However, prospect theory
adds that the subjective probabilities of different outcomes are distorted

(from the “real” probabilities) because of framing issues and heuristics
such as representativeness and availability.
The underlying assumption of prospect theory is that with sufficient
effort a researcher can elicit subjective probabilities. Perhaps for this rea-
son, cognitive psychologists in recent years have mostly ignored the risk/
uncertainty distinction. Some years ago, however, Daniel Ellsberg (of
Pentagon Papers fame) wrote about the effects on decision making of
Knightean uncertainty, which he called “ambiguity.” According to Ells-
berg (1961), decision makers attempt to avoid ambiguity and in so doing
violate the axioms of expected utility theory. Because expected utility
theory assumes situations of pure risk (where probabilities are known), I
do not fully understand how expected utility axioms could ever apply to
choices made under any degree of Knightean uncertainty. If such axioms
are inapplicable, how can they be violated?
The predominant view of contemporary cognitive psychologists on
risk and uncertainty is summarized in Jonathan Baron’s influential text-
book Thinking and Deciding (2008). Baron notes that the majority of
psychological experiments assume situations of pure risk. Taking a sub-
jective probability perspective, Baron argues:
The personal theory of probability . . . implies that the idea of “un-

known” probabilities makes little sense. Because probabilities are prop-
erties of the person, not the world, the only way in which a probability
could be “unknown” is for the person not to have reflected enough about
the situation. (282–283)
This seems like an unrealistic, peculiar view of how the world works.
As I write, the world’s economy is in flux. Investors are having tremen-
dous problems because of their uncertainties (in a Knightean sense) about
all sorts of “outcomes.” These uncertainties cannot be resolved simply by
further “reflection.”
Nonetheless, Baron comes to a conclusion similar to that I and others
have reached about how people react in situations of ambiguity/uncer-
tainty. He agrees with Ellsberg that decision makers will often delay
taking actions in such cases. Instead, they will seek information to make
situations less ambiguous (284). Perhaps such information seeking is what
Baron means by “reflection.”
Anthropologists
Some quantitatively oriented anthropologists have attempted to deter-

mine the extent to which risk-related models of behavior from other
disciplines help explain data collected in ethnographic and archaeologi-
cal fieldwork. Economic anthropologists have emphasized shortcomings
of the expected utility model in describing how farmers make choices
when faced with Knightean uncertainty. Ecological anthropologists and
archaeologists have argued that models from biology are useful in under-
standing the adaptive benefits of varied human actions with respect to
risk. Anthropologists emphasizing “scientific” approaches to the analysis
of human behavior have used the methods of experimental economics to
test risk models in ethnographic settings.
In contrast with those researchers who begin their analyses by looking
at ideas from other disciplines, other anthropologists looking at decision
making in risky and uncertain situations reject altogether models from
economics and biology. Some agree with cognitive psychologists that
such models do not provide realistic guides to how people actually make
decisions. Their fieldwork emphasizes eliciting the cultural rules (heu-
ristics) that decision makers employ in their efforts to cope with risk and
uncertainty. Other anthropologists taking a “cultural” approach toward
risk and uncertainty disdain the ideas of both mainstream economists
and cognitive psychologists. These social constructivists say that cultures
differ in the amount of attention they pay to each of the multiple risks
and uncertainties associated with particular decision-making situations.
Furthermore, within societies there is no consensus about the potential
downsides of different choices. Perhaps the majority of anthropologists
analyzing decision making take an ethnographic approach that describes
the activities that individuals and groups take to avoid unacceptable risks.
Although their descriptions may be consistent with the theoretical ideas
of economics, behavioral ecologists, and cognitive psychologists, these
empirically oriented anthropologists do not attempt to create and test
models of decision making.
anthropoloGiStS examininG riSk

moDelS from other DiSciplineS
In the 1970s and 1980s Sutti Ortiz and Frank Cancian were the most
prominent anthropologists examining economic models of the influence
of risk on agricultural decision making. In Uncertainties in Peasant Farming
(1973), Ortiz clearly states why indigenous (Paez) farmers in Colombia

making varied choices could not take risk into consideration in the ways
that conventional economic theory predicts:
Not only do weather conditions vary to an extent that makes it impos-

sible to determine the chances of crop failure, but farmers lack the tech-
nical knowledge to enable them to evaluate the chances with sufficient
accuracy. . . . [F]or decisions to be made with certainty [Ortiz means
“risk” here], four conditions must be met: 1, that frequency ratios must
be obtained from numerous and uniform sets of performance; 2, that
performances can be repeated; 3, that experiments from which the fre-
quency ratios are derived do not destroy the circumstances in which they
were performed, hence that it does not become a unique act, and that
the system remains stable; 4, that we consider only the total result of a
large number of trials and not each trial separately. A Paez farmer cannot
determine frequency ratios. His economic environment is changing; his
assets are so limited that he can invest them in a venture once and never
again if that venture fails; his technological knowledge of production
limits the number of possible decisions—for example, coffee is planted
once in a lifetime when he is a young and an inexperienced farmer. (13) 4
Ortiz later emphasized that Paez farmers did not remember the in-
formation, even when it was available, needed to make the calculations
required by expected utility theory. She notes, for instance, that “as
farmers do not memorize price sequences, they are only able to talk about
the most familiar outcomes, note the general trend in prices, and give
a few examples of past prices” (1980:187). While Ortiz concludes that
Paez farmers are unable to arrive at probabilistic estimates or forecasts,
she concedes that they see some outcomes of choices as more likely than
others (188). Even though Ortiz’s goal is to show that farmers attempt
to maximize “returns” (however measured) as economic theories about
rationality predict, she says that they cannot do so in the ways stipulated
by expected utility theory. I am unsure what Ortiz means by “rationality”
in this context.
Cancian most thoroughly presents his views about risk and uncertainty
in The Innovator’s Situation: Upper-Middle-Class Conservatism in Agricul-
tural Communities (1979). In this book Cancian compares the effects of
wealth and “rank” (social status) on farmers’ willingness to innovate in di-
verse societies. According to Cancian, there are several reasons wealthier
farmers are especially willing to innovate. They are more able than their
poorer neighbors to economically withstand the adverse consequences of

an unsuccessful experiment. Furthermore, innovations ordinarily require
substantial investments of money that wealthier farmers are more able to
afford. Finally, because wealthy farmers are more likely to be educated,
they are better able to gain access to and understand relevant information.
Because the Knightean uncertainty associated with a lack of information
inhibits innovations, poorer farmers lacking knowledge about the pos-
sible consequences of choices are less likely to be the first to experiment
with new farming methods. Cancian also argues, however, that the asso-
ciation of wealth with high status inhibits innovation. People with high
rank have less to gain and more to lose from a random change in their
status.
Cancian points out that the combined effects of these facilitating and
inhibiting effects on innovations are not straightforward:
[T]he overall theory makes no specific prediction about the dominance

of the inhibiting effect or the facilitating effect. The only clear prediction
is that the strength of the inhibiting effect should decrease as uncertainty
decreases. That is, early in the innovation process, when uncertainty
about the outcome of using a new practice is high, the inhibiting effect
should be at its strongest. As more and more people adopt an innovation,
information spreads, uncertainty is reduced, and the inhibiting effect
should gradually disappear. . . . Since the inhibiting effect and the facili-
tating effect “contradict” each other, the disappearance of the inhibit-
ing effect means the emergence of the facilitating effect in the empirical
curve. (19)
He concludes through an examination of empirical evidence from di-

verse places that the relationship between wealth and willingness to inno-
vate is nonlinear. As would be predicted by purely economic models, the
wealthiest farmers are overall the most likely to innovate and the poorest
farmers are the least likely. However, inhibiting sociological consider-
ations of rank lead to upper-middle-class farmers being less willing to
innovate than lower-middle-class farmers.
Unlike Ortiz and Cancian, a number of anthropologists writing about
risk and uncertainty in recent years have largely accepted the assumptions
of formal models from other disciplines. Some ecological anthropologists
interested in subsistence decisions in the past and present have placed par-
ticular emphasis on models drawn from nonhuman behavioral ecology.
These evolutionary models assume that organisms adapt to risky environ-
ments in ways that will maximize their chances of passing their genes on
to future generations. In an exhaustive review, Bruce Winterhalder, Flora
Liu, and Bram Tucker (1999) examine numerous mathematical models re-
lated to risk in behavioral ecology. Many of these models are concerned
with optimal foraging strategies. They conclude that only a few anthro-
pological studies of subsistence have made rigorous use of such models.
The authors describe four such studies that “exemplify a full risk-sensitive
argument” (332). These archaeological and ethnographic studies examine
why certain mixes of sheep and goats are used in an environment char-
acterized by unpredictable droughts (Mace and Houston 1989), explore
the rationale behind the use of multiple, dispersed plots by farmers in
the Peruvian Andes (Goland 1993), simulate prehistoric Hopi exchange
under three scenarios for interhousehold sharing (Hegmon 1989), and
look at the conditions in which cooperative behavior was useful among
the Northern Anasazi of Mesa Verde between 900 and 1300 (Kohler and
Van West 1996).
In the first part of this century some anthropologists (including Hen-
rich and McElreath 2002, Kuznar 2001) have used methods taken from
experimental economics in efforts to determine the subjective proba-
bilities of different outcomes among farmers and pastoralists making de-
cisions in nonwestern settings. These experiments involve attempts to
determine propensities for risk taking by asking people to make choices—
sometimes hypothetical, sometimes involving money—between sure re-
turns and various lottery options (for example, 50 percent chance of re-
turn X and 50 percent chance of return Y). They compare the results of
these experiments to expected utility theory and Cancian’s ideas about
upper-middle-class conservatism. The obvious question is the extent to
which choices made in such circumstances mirror real-life behavior.
anthropoloGiStS rejectinG riSk

moDelS from other DiSciplineS
Several decades ago the anthropologist Naomi Quinn sharply criticized
the expected utility approach to the analysis of decision making. In an
article with the straightforward title “Do Mfantse Fish Sellers Estimate
Probabilities in their Heads?” (1978), Quinn explicitly rejects “the wide-
spread assumption by economists that individual decision makers can and
do construct probability distributions against which they assess the riski-
ness of uncertain decisions” (207–208). From interviews with women in
Ghana who made decisions about when and where to market fish, Quinn
concludes that their decisions were based on simple rules of thumb based
on information they gathered. They asked truck drivers and traders about
market conditions the previous day, looked at supplies of fish at various
beaches, and guessed (erroneously) that high demand in the market one
day would be followed by low demand the next.
Although Quinn’s methods were inspired by the work of cognitive psy-
chologists, she does not accept all of their conclusions:
[T]he fish sellers interviewed in the present study did not seem to rely
upon representativeness, availability, or any other heuristic that psy-
chologists have observed their subjects applying to probability judgment
tasks. Perhaps in recognition that their judgments of probability “foretell
the future” poorly, or perhaps because other, less complex or more con-
crete indicators of future market conditions are available to them, fish
sellers avoid making probability estimates altogether. Instead, the sellers
report using information about a number of currently available test indi-
cators of future market conditions. Sellers assess each of these indicators
independently and go to market only if none of their tests indicate un-
favorable market conditions. (209)
Quinn made little attempt to examine the extent to which fish sellers in
practice used the heuristics they reported. Her work inspired considerable
research on varied topics in cognitive anthropology and may have had
some influence on the work of Sutti Ortiz and other economic anthro-
pologists in the 1980s. However, Quinn quickly turned to other interests
within cognitive anthropology such as “schema” concerning American
marriages (Quinn 1982, 1996). Few anthropologists nowadays examine
the use of heuristics in economic decision making.5
Mary Douglas’s treatment of risk is markedly different from those of
Ortiz, Cancian, and Quinn. Douglas’s “cultural” approach has had con-
siderable influence outside of anthropology (for example, Lupton 1999).
Douglas says that differences between “expert” and “lay” judgments of
risk have nothing to do with ordinary people’s inability to think in terms
of probabilities (1985:3). She argues instead (1992:8) that when people
estimate probability and credibility, their judgments are influenced by
culturally learned conventions, expectations, and categories. Douglas
emphasizes intercultural and intracultural variations in judgments about
what kinds of risks are considered to be dangerous. As Lupton points
out (1999:45), Douglas asserts that the risks that receive most atten-
tion in particular cultures are those connected with legitimating moral
principles.
Although Douglas’s social constructivist views on risk would seem to

be attractive to the many anthropologists disliking the scientistic models
of economists, biologists, and psychologists, her ideas have been con-
troversial even among those scholars sympathetic to her theoretical ap-
proach. In several publications (Douglas 1990, 1992; Douglas and Wildav-
sky 1982), Douglas and her colleagues argue that certain cultural values
have led many people in western societies to overestimate the dangers of
particular environmental and health risks. This has led Douglas and col-
leagues to take political positions at odds with those of many scholars
(among them Kaprow 1985, Lupton 1999:57) who regard her as an apolo-
gist for conservative business interests.
Douglas’s general point nonetheless is clearly right. Humans have
often overestimated or underestimated dangers from threats such as epi-
demics, earthquakes, unhealthy foods, and terrorist attacks. Briscoe and
Alersey-Williams offer an opinionated, popularly written review (2009)
of such misestimates nowadays. A recent example was the “swine flu” scare
in 2009, when the vice president of the United States warned unreason-
ably of the perils of traveling in confined spaces such as airplanes and sub-
ways and the Egyptian government tried to kill every pig in the country.
Although cognitive psychologists might analyze such fears as the results
of inappropriate use of heuristics, it would be foolish to deny that they are
related to cultural concerns.
Most economic anthropologists writing about decision making in
situations of risk and uncertainty avoid theoretical discussions altogether.
They instead describe activities that reduce risk such as planting in mul-
tiple fields, growing subsistence crops, engaging in multiple occupations,
helping kin and neighbors in times of need, and patronizing stores that
provide credit.
The unconventional economist Sanjay Reddy derides such ethno-
graphic description:
In much of the more naive and derivative anthropological literature, risk

is largely perceived as being simply “objectively” given (the risk, for ex-
ample, of crop loss due to pestilence, of collapse in the price of a cash
crop, or of attack by one’s neighbors) and the relevant questions are per-
ceived to concern how it is that communities adapt to and live with these
risks . . . Much of this literature has unreflectively and uninterestingly
adopted economists’ conceptions to arrive at a picture of peasants and
tribals undertaking probabilistic “risk” calculations as a means of arriving
at key decisions. (1996:230–231)
Reddy’s comments betray a misunderstanding of the ideas of most eco-

nomic anthropologists, who are ordinarily skeptical about the use of the
models of mainstream economists. More importantly, there is nothing
trivial about descriptions of how individuals and communities “adapt to”
and “live with” risks.
In an edited collection dominated by model- driven anthropological
approaches to risk and uncertainty (Cashdan 1990), Michael Baksh and
Allen Johnson cogently argue that
one of the contributions anthropology is best equipped to make to risk

studies is to provide an ethnographic context crucial for a full under-
standing of risk avoidance behavior . . . [M]ost students of risk in eco-
nomic, social, and other behavior would argue that the real situations
in which decisions concerning risk are made are far more complex than
the formal models used to analyze them, and some would follow us in
the further claim that realistic analyses of risk may need to be quite a bit
more complex, and less elegant, than formal models will allow. To be
sure, textbook analyses of risk, such has how to invest in a lottery ticket
where probabilities of winning or losing wagers of various amounts are
perfectly known, depict decisions far cleaner and simpler than the every-
day decisions of most men and women, whether in the modern business
world or in a distant subsistence economy. (194)
Baksh and Johnson proceed to illustrate their point (with which I com-
pletely agree) by describing the myriad activities of the Machiguenga of
tropical Peru to deal with risks related to the environment, subsistence,
social conflict, and cultural loss.
Conclusions
Economists making expected utility assumptions have developed seem-

ingly straightforward methods for analyzing how decisions should be made
in situations of risk and uncertainty. They first estimate the probability of
different outcomes when particular choices are selected. Their next step
is to estimate the payoffs (utilities) associated with different outcomes.
Using their estimates of probabilities and payoffs, they then calculate the
expected (average) payoffs of the various options. “Rational” decision
makers, they argue, should pick the option that provides the highest ex-
pected payoff.
Many economists recognize that the expected utility approach to deci-

sion making has certain shortcomings. Individuals differ in their willing-
ness to take on risk. Some such differences are idiosyncratic. Others, how-
ever, are the predictable consequences of poor people being especially
unwilling to make risky decisions that may lead to the loss of their liveli-
hoods. In their efforts to deal with differential “risk preferences,” econo-
mists have created complex mathematical models of decision making.
Although many economists limit their work on risk and uncertainty to
model building, others have attempted to compare the implications of
their prescriptive models with actual decision making. The results have
not been all that impressive.
Cognitive psychologists have questioned the fundamental assumptions
behind economists’ models of decision making. Their critiques have fo-
cused on the extent to which individuals can estimate the odds of differ-
ent outcomes. In a famous series of ingenious, well-designed experiments,
psychologists have shown that in laboratory settings “subjects” do not
estimate probabilities of outcomes to decisions. They instead ordinarily
use various heuristics to simplify decision making.
The social science literature on risk and uncertainty is dominated
by economists’ models and psychologists’ experiments. These scholars
largely ignore Knightean uncertainty, usually preferring to analyze situa-
tions of pure risk (although the relevant probabilities may be “subjective”
rather than “objective”). By neglecting uncertainty, economists and psy-
chologists are failing to consider the vast majority of decision-making
situations.
Economists and psychologists writing about risk and uncertainty
usually devote only a paragraph or two to the relevance of their models
and experiments to on-the-ground decision making. They rarely dis-
cuss multiple risks and uncertainties, choices that fall along a fuzzy risk-
uncertainty continuum, hard-to-measure and often incommensurable
costs and benefits, and conflicting short-term and long-term payoffs from
decisions. The discussion in this chapter of choices encountered by Iowa
farmers, Peruvian ribereños, and Oaxacan wood carvers shows how such
complexities can affect decision making under risk and uncertainty in
real-world contexts.
There are obvious reasons social scientists interested in risk create
simplified models of reality and conduct experiments in carefully con-
trolled laboratory settings. Such models and experiments are designed
to eliminate many of the confusing and extraneous variables that can ob-
scure the effects of risk and uncertainty on decision making. The crucial
question is whether the gains from such simplifications outweigh the loss
of nuance. In my view, they rarely do.
Economists and psychologists do not seem much impressed by im-
precisely phrased generalizations about how diversification reduces risk
and information gathering reduces uncertainty. Vague as they may be,
I think that such generalizations have been more helpful in understand-
ing human behavior than the great majority of economists’ models and
psychologists’ experiments. There is, however, no substitute for ethno-
graphically rich descriptions of the complexities of decision making in
particular risky and uncertain situations. This is the work of anthropolo-
gists. Through their detailed ethnography, anthropologists have made
an invaluable, though often neglected, contribution to our knowledge of
such choices.
CHAPTER 4
Experimental Games and

Choices about Cooperation
Sociocultural anthropologists, unlike their colleagues in psychology,

sociology, and economics, rarely experiment. The field situations of an-
thropologists ordinarily do not allow the intentional, careful manipula-
tion of variables required in good experiments. Furthermore, most socio-
cultural anthropologists explicitly avoid such manipulation; their goal is
to minimize the effects of their presence on what they observe. Many have
theoretical objections to experimentation. The isolation of a few variables
for analytic purposes in experimental research differs markedly from the
many holistic studies in sociocultural anthropology that emphasize the
complex interaction of multiple variables.
In recent years, however, a close-knit group of sociocultural anthro-
pologists has been conducting controversial cross-cultural economic ex-
periments aimed at testing ideas from evolutionary biology and economics
about cooperation and competition. In this chapter I critically examine
the assumptions and logical underpinnings of these ambitious, intriguing
experiments. I contrast the parsimonious theoretical models underlying
the experiments with the messy ethnographic reality of daily life.
An Overview of Economic Experiments in Anthropology
In the summer of 1996 an indigenous group in the Peruvian Amazon took

part in an economic experiment. Under the supervision of Joseph Hen-
rich, the Machiguenga played the Ultimatum Game, in which two par-
ticipants have a fixed amount of money (the stake) that must be divided
between them. One participant, the “proposer,” suggests how the stake
should be divided. The other participant, the “responder,” may accept or
Experimental Games and Choices about Cooperation 91
reject this offer. If the offer is accepted, both participants receive the share
suggested by the proposer. If the offer is rejected, neither participant re-
ceives any money.
This brief piece of fieldwork by a graduate student at the University
of California, Los Angeles, was the first of many anthropological experi-
ments aimed at comparing the extent to which individuals in particular
societies are willing to be generous with others. These cross-cultural ex-
periments, well-funded by the standards of sociocultural anthropology,
have received extensive publicity. In the late 1990s the MacArthur Foun-
dation gave grants to anthropologists to study the Ultimatum and other
games in fifteen small-scale societies. The results of the MacArthur-
funded research were discussed in a cover story in Scientific American
(Sigmund, Fehr, and Nowak 2002) and reported in other widely read pub-
lications such as Nature (Fehr and Gachter 2002), Science News (Bower
2002), and the Wall Street Journal (Wessel 2002). In 2002 the Cultural
Anthropology Program of the National Science Foundation (NSF) gave
its largest grant ($463,425 over a three-year span) for further research
on this topic to many of the same anthropologists who had been funded
by the MacArthur Foundation. Stuart Plattner, then head of the NSF
Cultural Anthropology Program, commented that “this new research is
cutting edge stuff . . . [that] will advance economic theory” (in Bower
2002:106).
The most publicized finding of these experiments is a significant posi-
tive correlation between the degree of market integration of a society and
the proportion of the stake offered to the responder in the Ultimatum
Game. This correlation has been widely interpreted (for example, Ens-
minger 2002:60, Surowiecki 2004:125) as an indication that the develop-
ment of markets is associated with greater fair-mindedness and trust of
strangers. Proponents of experimental economics in anthropology confi-
dently assert that this and other findings “illuminate the nature of human
nature, the potential importance of culture, and the appropriateness of
the assumption of self-interest that underpins much of social science”
(Henrich et al., “Overview and Synthesis,” 2004:10).
These experiments have received so much funding and publicity be-
cause they aim at providing novel insights about long-standing questions
in both the natural and social sciences concerning cooperation and com-
petition. Evolutionary biologists since Darwin have been interested in
the origins of altruistic behavior, when individuals act in ways that are
good for their group but appear to reduce the chances of passing on their
genes to future generations. The now generally accepted way to resolve
this seeming paradox is to argue that particular cases of altruistic be-

havior that threaten the survival of individuals actually help them pass
on their genes by increasing the probability of survival and reproduc-
tion of closely related kin. While such kin selection explanations seem to
work well for most species, they do not account for the many situations
in which humans act in ways that really do seem to reduce the chances
of their genes being passed on. In such cases, altruistic behavior involves
self-sacrifice for either distant relatives or nonrelatives.
Economists influenced by rational choice theory are often puzzled
when individuals act in ways that do not appear to be in their self-interest.
Such activities, often involving cooperation with others, are a challenge
to the underpinnings of their discipline. The ways in which economists
usually think about generosity have nothing to do with the genetic ad-
vantages of helping closely related kin. They instead sometimes argue
that generous behavior in the short run actually helps individuals in the
long run. If such arguments seem implausible, economists may resort to
the unprovable claim that the culturally valued, hard-to-measure “utility”
that an individual gains from a good deed outweighs more easily mea-
sured losses such as monetary cost and the risk of physical injury or illness.
One of oldest issues in the social sciences concerns the ways in which
different groups deal with conflicts between the individual pursuit of
self-interest and culturally variable ideas about the public good. Societies
clearly differ in their relative emphasis on individual “rights” and group
well-being. Within democratic countries, there are often heated debates
between advocates of “individual liberty” and those motivated primarily
by their vision of the good of the community. The lines of these arguments
do not always break along conventional conservative/liberal divides. Ex-
amples of such controversies in the contemporary United States include
debates over marijuana use, gun ownership, abortion, same-sex marriage,
and legalized gambling.
The creation of experiments such as the Ultimatum Game in the
1980s took place because economists and psychologists wanted to use
controlled laboratory settings to examine the extent to which individu-
als would sacrifice their self-interests in order to help others. Prior to the
work of Henrich among the Machiguenga, the great majority of these
experiments took place in industrial countries, often with university stu-
dents as subjects. Some economists and psychologists worried that only
limited conclusions could be drawn from the experiments because the
participants shared similar culturally influenced ideas about generosity
and selfishness. The appeal of the anthropological experiments in small-
scale societies came from their broadening the pool of subjects by includ-
ing participants from many cultures. This would, at least in theory, allow
a better assessment of the effects of culture on generosity and selfishness.
Information on cultural variability was also of great interest to evolution-
ary biologists theorizing about supposedly genetic reasons for altruism.
If there was considerable variation in the extent of altruism in different
societies, evolutionary biological explanations for such behavior might be
questioned.
I find much to admire about the goals and activities of the anthropolo-
gists carrying out economic experiments. Their methodological rigor,
willingness to engage in dialogue with scholars in both the natural and
social sciences, and commitment to cross- cultural comparisons are re-
freshing in a time when many anthropologists question any attempts to
measure variables and test hypotheses. Nonetheless, I think this research
exemplifies the dangers of ignoring ethnographic complexity when at-
tempts are made to create models of human behavior that can be mathe-
matically formulated and experimentally tested. Furthermore, the pro-
ponents of these experiments are in my view often insufficiently critical
of theoretical assumptions in biology and economics and insufficiently
attentive to relevant anthropological theory.
The findings of these economic experiments are, I will argue, consis-
tent with long-accepted ideas in sociocultural anthropology. To under-
stand why this research is nonetheless of such great interest to scholars in
other disciplines, I describe here the history of experimental economics
and theories about “selfishness” in evolutionary biology and the social
sciences. I critically examine in some detail the studies of those anthro-
pologists conducting economic experiments. Emphasis is placed on the
disjuncture between what people do in these experiments and how they
behave in their daily lives. Before presenting these theories and studies,
however, I think it is useful to present some concrete examples of the ten-
sion between economic selfishness and generosity among Oaxacan wood
carvers. The complexity of such real-life examples suggests why a cer-
tain degree of skepticism may be warranted toward wide-ranging theories
about competition and cooperation.
Openness and Secrecy among Oaxacan Wood Carvers
Wood carvings from the Mexican state of Oaxaca entered the interna-
tional folk art market on a large scale starting around 1985. The trade
originated somewhat earlier as a result of the activities of shop owners

based in the city of Oaxaca and two particular carvers from communities
in the nearby Central Valleys, Manuel Jiménez (1919–2005) of Arrazola
and Isidoro Cruz (1934– ) of San Martín Tilcajete.
Jiménez began to carve wooden figures as a boy to pass time while
tending animals. In the late 1950s and early 1960s, owners of crafts shops
in Oaxaca bought a number of his carvings and sold them to prominent
folk art collectors. By the late 1960s, Jiménez was giving exhibitions in
museums in Mexico and the United States. His carvings were featured
in books and films about Mexican art. As Jiménez’s reputation grew and
rural roads improved during the 1970s, tourists and collectors began to
visit his workshop in Arrazola.
Isidoro Cruz learned to carve during a yearlong illness in the late 1940s.
While he was working as an oxcart maker in the city of Oaxaca in 1968,
Cruz’s carvings were noticed by Tonatiúh Gutiérrez, the director of ex-
positions for the National Tourism Council. Gutiérrez, who knew about
Manuel Jiménez’s work, urged Cruz to make masks for sale. Gutiérrez
later became director of a national agency that attempted to increase sales
of Mexican crafts. He appointed Cruz as head of the agency’s buying cen-
ter in the city of Oaxaca. Cruz kept this job for four years. During this
time he was able to get jobs for some men from San Martín Tilcajete in
government offices around Mexico. These men were therefore able to be-
come knowledgeable about the folk art business.
Jiménez and Cruz differed greatly in their willingness to share infor-
mation about their artistic methods. Manuel Jiménez was secretive, show-
ing his techniques only to his children and a son-in-law. The experiences
of Miguel Santiago, a relative of Jiménez who is now a skilled, success-
ful artisan, illustrate the extent to which Jiménez hid his methods. In the
early 1980s Miguel Santiago was unsure about what paint to use on his
pieces. He tried a paint used on posters but gave up when a potential cus-
tomer’s hands became smeared while handling a carving. Because San-
tiago knew that Jiménez had abandoned water-based aniline for another
type of paint, he searched the ravines around Arrazola for paint cans
that Jiménez had discarded. These cans rarely had labels. When Santiago
finally found a can with a label, he still was unsure what the paint was. He
suspected that the Jiménez family was using a kind of house paint, but he
was not certain about this until a local shop owner confirmed his hunch.
Because of Manuel Jiménez’s secrecy, the craft spread slowly in Arra-
zola, and there were only about six carving families in the community in
1985. In the next five years Jiménez’s methods became well known, and by
1990 most families in Arrazola had at least one artisan member. Although
many of the new carvers and painters in Arrazola were talented, few could
match Manuel Jiménez’s skill and none had his reputation. Manuel re-
mained until his death the most famous carver and wealthiest resident
of Arrazola. When interviewed, he often disdained the carvings of his
neighbors, calling them “copiers.” In a typical statement, the maestro
proclaimed:
Mine is a sacred history . . . I am not just anybody. I am a real tiger. I

was born intelligent. Everyone here is living off my initiative. If I hadn’t
started carving, no one would be doing anything. I invented the whole
tradition. They should make a statue for me in the plaza, with an arrow
pointing to the house and rename this street Jiménez Street. (In Barbash
1993:19)
Isidoro Cruz, in contrast, was open about his methods and taught
many of his neighbors how to carve and paint. A number of carvers in
San Martín quickly became well known for their pieces and earned more
money from the craft than Cruz did. Their pieces rarely resembled those
of Cruz, who worked with difficult-to-use paints and woods and creatively
made new types of carvings with little regard for their potential salability.
Most of Isidoro Cruz’s friends and relatives in San Martín preferred to
model their pieces after those of Manuel Jiménez.
The difference in the willingness of Jiménez and Cruz to share their
methods is in part related to their ideas about the advantages and dis-
advantages of cooperation with other members of their community.
Jiménez regarded other artisans as competitors for a product for which
there was a limited market. He was no more willing to show his methods
to his neighbors than a company would be to give away trade secrets. Cruz
thought that all the wood carvers in San Martín would benefit if there
were numerous well-known artisan families in the community. If the town
could establish itself as a wood-carving center, more tourists and collec-
tors would visit and business would be better for everyone. His reasoning
resembled that of entrepreneurs opening a particular type of ethnic res-
taurant in a large city in a neighborhood that already has many such res-
taurants. Such entrepreneurs assume that they will succeed because of the
customers attracted to the area.
Manuel Jiménez and Isidoro Cruz differed in their approach to co-
operation and competition because of both their personalities and their
positions in the wood-carving trade. Manuel was much more suspicious
of the activities of others than was Cruz. Jiménez was gregarious in his
dealings with tourists, but this extroversion did not extend to most resi-
dents of Arrazola. Although Jiménez lived in a town where participation
in community organizations was a central part of daily life and where
social events such as fiestas and weddings were of great importance, he
largely kept the life of his immediate family separate from that of his
neighbors. Cruz, in contrast, was a pillar of the community and one of the
best-liked men in San Martín.
These personality differences, however, are only part of the story.
Manuel Jiménez reasonably feared that copying by others would threaten
his position as the most famous artisan in Arrazola. For many years he
had been the only important wood carver in the entire state of Oaxaca.
If others created pieces similar to his and charged lower prices, Jiménez
might lose both economic clout and prestige. Isidoro Cruz was the pre-
eminent wood carver in San Martín for only a short time. Furthermore,
he quickly found out that other artisans were more interested in Jiménez’s
methods than his own. The costs and benefits of openness and secrecy
were quite different for the two men. Even ignoring their personalities,
Cruz had more reasons to share his methods than Jiménez.
Over the years Oaxacan wood carvers have developed specialties in
their efforts to appeal to a diverse clientele. Some artisan families make
expensive, labor-intensive carvings for collectors; others churn out cheap
pieces for gift shops in the United States and tourists seeking souvenirs.
Artisans vary in their styles of painting and carving and in the size of their
pieces. They make animals, human figures, devils, angels, frames, chairs,
tables, and ox carts. There are carvings of Benito Juárez, subcomandante
Marcos (the Zapatista leader), chupacabras (imaginary beings that eat
goats), Martians, mermaids, and helicopters.
When artisan families create successful market niches for their carv-
ings, they know that they are likely to suffer economically if their neigh-
bors create similar pieces at lower prices. It is not surprising that many
artisans resemble Manuel Jiménez in their secrecy and complaints about
imitators. Artisans go to great lengths to develop skills that enable them
to create pieces that cannot be easily copied.
Nowadays most artisans share Isidoro Cruz’s perspective that some
degree of cooperation is necessary to attract tourists and dealers to their
communities. In the past the extent to which artisan families cooperated
to sell their pieces was limited because of their competition with one
another for the attention of dealers. Since 2000 the demand for Oaxa-
can wood carvings has weakened significantly because of changing tastes
in folk art and a decline in tourism because of political problems in the

state. Many wood carvers have abandoned the craft, relying on income
from other kinds of work and money earned through temporary migra-
tion to the United States. Those who have remained artisans have been
more willing to participate in organizations that collectively market wood
carvings. This necessarily means some loss in secrecy about techniques
and a greater willingness to share knowledge about ways to make salable
pieces.
Advantages and Disadvantages of Artisans Sharing Information
Despite the emphasis on altruistic sacrifice by evolutionary biologists

and economists, most cooperative behavior provides some benefits to all
parties involved. When Isidoro Cruz and other wood carvers share infor-
mation about methods with their neighbors, they are doing more than just
contributing to good community relations. They are also improving the
overall quality of artisanry in their community, which is likely to attract
more potential buyers such as tourists and folk art dealers.
Individual Oaxacan wood carvers sharing techniques that they have
originated must weigh such benefits against the cost of losing competitive
advantage in the marketplace. For Cruz the benefits clearly outweighed
the costs; his innovations turned out not to be ones that his neighbors
wished to emulate. Manuel Jiménez, however, worried with reason that
his techniques and artistic styles would be copied by neighbors who would
sell similar pieces for lower prices. But in the long run it was impossible
for Jiménez to hide his methods, and his secrecy resulted in his losing
popularity within his community. By this time Jiménez may not have
cared too much about his local reputation; his self-esteem rested on the
praise he received from collectors and art critics in the outside world.
Jiménez’s economic fears about the results of copying seem to have been
misguided. His family did better than ever economically after Arrazola
became a noted wood-carving center with many skilled artisans.
The Oaxacan example shows why in many cases neither insiders nor
outsiders can easily judge whether a real-life decision involves a sacrifice.
To call the sharing of an artistic innovation “altruistic behavior” would be
misleading in rural Oaxaca. It is also difficult to unambiguously identify
“selfishness” among Oaxaca wood carvers. Manuel Jiménez’s neighbors
thought his secrecy was selfish because it prevented them from improv-
ing their miserable standard of living. He regarded their copying of his
methods and selling of pieces similar to his at lower prices as a selfish lack
of respect for the originator of an artistic tradition. From Jiménez’s per-
spective, his successors were freeloaders piggybacking on his hard work.
The decisions that Jiménez, Cruz, and other Oaxacan wood carvers
have made about openness and secrecy illustrate well the multiple risks
and uncertainties associated with many choices about cooperation and
competition. Artisans sharing a particular innovation cannot predict the
economic effects of their generosity. The new technique may turn out not
to be of much interest to potential buyers. If the innovation does attract
more visitors to the community’s workshops, the sales of the originator
could conceivably either increase or decrease. Sharers of a new technique
also cannot know if the recipients of their generosity will be able to rep-
licate or improve on their innovation.
Artisans refusing to share their techniques similarly cannot predict
with certainty what the effect will be on their reputation. Wood carvers
understand the desires of artisan families to establish niches in the mar-
ket by specializing in certain techniques and styles. Although many arti-
sans are happy to copy successful innovations, they know that a certain
amount of secrecy is economically necessary. Local social norms do not
unambiguously favor sharing; wood carvers who freely give out informa-
tion about all their methods are regarded as foolish. Nonetheless, an arti-
san who is unwilling to share any information about techniques, styles,
and potential buyers is disdained as being too selfish. Artisans therefore
walk a fine line between sharing too much and sharing too little and can-
not predict exactly what will be the reactions to a particular instance of
openness or secrecy.
Wood carvers must consider both the short-term and long-term con-
sequences of openness and secrecy. In the short term, secrecy may be
preferable because it forestalls competition. But the long-term conse-
quences of secrecy by particular artisans may be their lack of access to
innovations by others. Artisans are most likely to share techniques with
those who reciprocate.
Advocates of economic experimentation in anthropology argue that
we can improve our understanding of cooperation and selfishness through
carefully designed games played in quasi-laboratories in field settings. A
key question in assessing such claims is whether the essential features of
complicated decisions such as those faced by Oaxacan wood carvers can
be captured in such experiments.
Evolutionary Theory and Cross-Cultural Economic Experiments
When I first learned that sociocultural anthropologists were running eco-

nomic experiments, I assumed that the inspiration for this work came
from mainstream economics and economic anthropology. As an eco-
nomic anthropologist, I knew that there was a long tradition within our
subdiscipline of using ethnographic data from diverse societies to exam-
ine the cross-cultural applicability of economic theories. These experi-
ments, I guessed, were attempts to test economists’ generalizations about
human behavior.
My assumptions about the impetus behind this research turned out
to be only partly right. The Ultimatum Game and related experiments
about public goods did originate as attempts to test economists’ assump-
tions about rational choice. Furthermore, some of the anthropologists
involved in cross-cultural experiments (for example, Ensminger 2004)
are explicitly motivated by classic questions in economics and anthro-
pology such as debates over the effects of the development of markets on
individuals’ willingness to treat strangers fairly. Nonetheless, the primary
theoretical influences on most of these experimenters come from evolu-
tionary ideas in biology and anthropology. The experimenters argue that
the evolution of the capacity for culture has allowed individual human
beings to be more able than members of other species to incur costs in
order to help others and to punish selfish behavior. Their experiments are
aimed at determining the extent to which cultural ideas about cooperation
influence altruism and the punishment of selfishness.
The advocates of economic experimentation in anthropology differ in
the extent to which they attribute altruistic behavior to genetic propensi-
ties that evolved when all human beings were foragers. Some seem com-
fortable with conventional kin selection explanations from evolutionary
biology. Most, however, stress the importance of the cultural transmis-
sion of ideas and culture-gene coevolution.
Evolutionary Biology and the Problem of Altruism
When evolutionary biologists discuss cooperative and altruistic acts,

they almost always refer to behaviors that entail a cost to those perform-
ing them but that benefit others (Dugatkin 2006:28).1 This differs from
the ordinary-language definition of cooperative behavior, which usually
refers to acts that benefit everyone involved. Questions about altruism
have troubled evolutionary biologists ever since the field was founded.
Darwin worried about how his theory of natural selection could explain
the existence of castes of insects such as bees that never reproduce but
protect the lives of those that do. He speculated that the solution to this
dilemma was that natural selection acted on families rather than individu-
als (Richards 1987:145). Darwin also opened up for debate the more gen-
eral question about whether evolutionary pressures to sacrifice oneself for
others extended beyond blood relatives.
As Darwin suggested, explanations of altruism are inextricably inter-
twined with debates over the levels at which natural selection is thought to
act. According to “trait group” models that developed in the 1970s, natu-
ral selection can operate both within and between groups. These models
suggest that within-group selection acts against altruists. Selfish individu-
als receiving benefits from altruists but suffering none of their costs are
more likely to pass their genes on to subsequent generations. Between-
group selection, trait-group theorists say, can favor cooperation if groups
with large numbers of altruists reproduce more than competing groups
with fewer altruists. Most evolutionary biologists, however, agree with
William Hamilton, who in an important article (Hamilton 1963) flatly
rejected claims that altruism existed for the preservation of entire species.
Building on ideas earlier developed by J. B. S. Haldane, Hamilton
worked out the mathematics underlying kin selection.2 The simple idea
underlying his not-so-simple equations was that the closer the degree of
relationship of two individuals, the more likely they were to cooperate.
The existence and behavior of members of nonreproducing insect castes
could be understood by interpreting their altruism and sterility as maxi-
mizing their inclusive fitness, the chances of their genes being passed on
to future generations. Selection could be best thought of as operating at
the level of the gene rather than the individual or the group. Hamilton’s
ideas became well known after they were popularized in two extraordi-
narily influential books about evolution, Richard Dawkins’s The Selfish
Gene (1976) and E. O. Wilson’s Sociobiology (1975).3
Evolutionary biologists have questioned whether Hamilton’s approach
can explain spiteful behavior. Spiteful acts lower the inclusive fitness of
individuals committing them but decrease the fitness of recipients even
more. The conundrum posed by instances of spite is that individuals who
are not spiteful should have higher inclusive fitness than either initiators
or recipients of punishment. Although instances of spite in nonhuman
animals are rare, they are common among humans. In particular, indi-
viduals and groups often punish those who fail to engage in altruistic be-
havior such as food sharing.
Hamilton is also famous for his later work with the political scientist
Robert Axelrod on cooperation among nonrelated individuals (Axelrod
and Hamilton 1981, Axelrod 1984). Hamilton and Axelrod observed that
in real life individuals often interact with one another repeatedly. In such
cases, it would be an oversimplification to characterize any particular act
as “selfish” or “cooperative.” Instead, individuals might develop different
strategies toward those who had shown themselves willing to cooperate
and those who were consistently selfish. Through models and computer
simulations, Hamilton and Axelrod showed that in many circumstances
the tit-for-tat strategy was optimal. Using this strategy, individuals co-
operate with others as long as they remain cooperative. When others de-
fect (become noncooperative), an individual using the tit-for-tat strategy
also defects. Although such strategies have been effectively modeled on
computers, they can only occur in the world among species in which indi-
viduals have the capacity to come up with and carry out ideas such as
“tit for tat.” The work by Hamilton and Axelrod therefore suggests that
cooperation (reciprocity) among nonrelated individuals might be more
prevalent among humans than among other species.
Culture and Evolutionary Theory
The central theoretical and empirical questions underlying many eco-

nomic experiments in anthropology are directly tied to evolutionary
theory in biology. The experimenters want to solve what they regard as
the “puzzle” (Henrich and Henrich 2007:4) of why humans cooperate.
Their experiments are designed to contribute to cross-cultural compari-
sons of the conditions in which people are willing to cooperate, even if
this involves incurring costs. They seem particularly interested in spiteful
behavior toward “free riders” who are unwilling to reciprocate.
The theoretical basis of such experiments is perhaps most thoroughly
explained in the book Why Humans Cooperate (2007) by the anthropolo-
gists Natalie Henrich and Joseph Henrich. Unlike many evolutionary
biologists, Henrich and Henrich emphasize the distinctiveness of co-
operation among humans. They observe (40–41) that human cooperation
differs from that of nonhuman primates in both its scale and the nature of
its variability. Although the scale of cooperation in other primates rarely
exceeds two or three individuals, humans sometimes cooperate on scales
involving hundreds or even thousands of individuals. While nonhuman

primate species typically show little variation in the behavioral domains
of cooperative behavior, human social groups vary greatly in the activities
in which they cooperate.
Henrich and Henrich observe (55) that the existence and variability of
reciprocity among human groups is made possible by certain features of
our capacity for culture: cultural evolution occurs at a much faster rate
than genetic evolution; cultural learning processes allow populations to
rapidly adapt to novel situations without a genetic change; and cultural
transmission can, to a degree, construct its own environment. Although
these ideas might conceivably be novel for some evolutionary biologists,
they are so commonplace in anthropology that they are covered at the be-
ginning of most introductory courses.
The ideas of the proponents of cross-cultural economic experiments
(including some nonanthropologists) about the reasons for the evolution
of cooperative behavior are more interesting. At times Henrich and Hen-
rich argue that there is a gene for cooperation (!) and uncritically accept
the basic ideas of kin selection:
[N]atural selection will favor the evolution of psychological mechanisms

that allow cooperators to focus their benefits on other individuals who
are likely also to be cooperators . . . “Blood relatives” have many charac-
teristics in addition to the all-important cooperation gene(s) and natural
selection can take advantage of these in building psychologies that can
preferentially direct benefits at other individuals likely to have coopera-
tion genes. For example, close kin, such as siblings, may have a similar
appearance or smell that natural selection may use to build a psychology
such as “help those who look and smell like you.” These similarities may
be related to sharing some of the same genes (ones not related to co-
operation). (44)
Karl Sigmund, Ernest Fehr, and Martin Novak assert with respect to
spiteful behavior that our “emotional apparatus” was shaped by years of
living in foraging groups in which keeping secrets was hard:
If others know that I am content with a small share, they are likely to
make me small offers [presumably of food]; if I am known to become
angry when facing a low offer and to reject the deal, others have an in-
centive to make me high offers. Consequently, evolution should have
favored emotional responses to low offers. (2002:85)
Such spitefulness, they go on to say, is based on “universal, biologically

rooted capabilities” (87).
These genetic explanations seem to be at odds with the emphasis on
cultural transmission as being essential for the evolution of reciprocity
and other forms of cooperation among both kin and non-kin. Henrich
and Henrich and other economic experimenters deal with this appar-
ent contradiction by endorsing a highly mathematical “dual inheritance
theory” developed by Robert Boyd and Peter Richerson and others (Boyd
and Richerson 1985, Durham 1991, Richerson and Boyd 2005). Stripped
of the equations and jargon, this theory essentially suggests, in agreement
with long-accepted, less formalized anthropological ideas (as in Steward
1955), that the genetically evolved capacity for culture that was adaptive
in ancestral human lineages allows a diversity of behaviors in different
situations.
The proponents of cross-cultural economic experiments for the most
part avoid controversies in evolutionary biology about levels of selection.
Their brief statements about this question (for example, Bowles et al.
1997:9, Henrich and Henrich 2007:66) ordinarily suggest that group
selection plays an important role in human cultural evolution. They ar-
gue that the groups that developed the most successful guidelines for pur-
suing fair interactions were evolutionary successful. The implicit or ex-
plicit assumption is that these groups developed genetic traits—perhaps
merely the capacity for culture, perhaps something more like a “coopera-
tion gene”—that helped them make equitable exchanges and punish free
riders. Such claims are made even though most biologists are skepti-
cal about group selection arguments to explain altruism in nonhuman
species.
Experiments in Economics
In 1948 Edward Hastings Chamberlin noted that economics has not his-
torically been an experimental science:
It is a commonplace that, in its choice of method, economics is limited

by the fact that resort cannot be made to the laboratory techniques of
the natural sciences. On the one hand, the data of real life are necessarily
the product of many influences other than those which it is desired to
isolate—a difficulty which the most refined statistical methods can over-
come only in small part. On the other hand, the unwanted variables can-
not be held constant or eliminated in an economic “laboratory” because

the real world of human beings, firms, markets, and governments cannot
be reproduced artificially and controlled. (95)
Nonetheless, in the past six decades an increasing number of econo-

mists, including Chamberlin himself, have conducted experiments in
laboratories, usually with university students as participants. The diverse
topics that have been examined include public goods, bargaining, indus-
trial organization, auctions, and individual decision making (Roth 1995).
The idea behind these experiments is to examine the extent to which
participants’ behavior corresponds to the predictions of economic theo-
ries. Experiments often test assumptions about rational choice, especially
those derived from game theory (von Neumann and Morgenstern 1944).
The economists’ experiments have shown that notions of fairness, co-
operation, and trust play a crucial role in economic transactions (at least
in laboratories) and sometimes lead to outcomes different from those ex-
pected by rational choice theory (Chaudhuri 2009:17). Although such
findings are not at all surprising to most anthropologists, economists have
been impressed by the conclusion that “tendencies towards rampant self-
interest are [very often] moderated by notions of fairness” (ibid.:71).
The interests of experimental economists overlap with those of evo-
lutionary biologists. Both groups of scholars see cooperation as a puzzle
not readily explained by prevailing theories in their disciplines, and they
draw inspiration from game theory. They share an interest in spiteful
behavior in which individuals incur costs to punish noncooperators. Ex-
perimental economists and evolutionary biologists, however, differ in the
ways in which they have thought about the “puzzle” of cooperation. Bi-
ologists have been primarily concerned with the mechanisms underlying
altruistic behavior, focusing on kin selection (often among nonhuman
species). Economists, who ordinarily restrict their analyses to humans,
are most interested in cooperation among nonrelated people in contem-
porary industrial societies. Unlike biologists (and anthropologists), most
economists are relatively uninterested in how and why cooperative ideas
and behaviors develop and change over time. They ordinarily emphasize
instead what these ideas and behaviors are in different societies and how
they affect strategic decision making. Economists and evolutionary bi-
ologists also differ in the amount of attention they give to altruism and
notions of fairness. Perhaps because ideas about fairness are unimportant
or nonexistent in nonhuman species, biologists focus on altruistic behav-
ior. Economists, possibly because they find pure altruism so contrary to
the fundamental tenets of their discipline, are much more concerned with
social norms about fairness.
Writers about the history of institutions have for centuries been inter-
ested in the relationship between markets and ideas about fairness. Some
writers, notably Karl Marx, assert that markets undermine the moral
foundations of societies by encouraging self-interested behavior. Others
(including Baron Montesquieu) argue that markets encourage fairness
because of the premium on honesty and reputation required in repeat
dealings (Ensminger 2004, Hirschmann 1982). This latter idea was a fore-
runner of mathematical theories about reciprocity that note the advan-
tages of strategies such as tit for tat in certain circumstances.
The New Yorker economics columnist James Surowiecki elaborates on
the argument that capitalism encourages fairness because much business
is transacted between strangers:
Modern capitalism made the idea of trusting people with whom you had
“no prior personal ties” seem reasonable, if only by demonstrating that
strangers would not, as a matter of course, betray you. This helped trust
become woven into the basic fabric of everyday business. Buying and
selling no longer required a personal connection. It could be driven in-
stead by the benefits of mutual exchange. (2004:123)
The reason participants in market economies are willing to be fair in this

limited sense, Surowiecki says, is “a greater emphasis on the accumula-
tion of capital over the long run as opposed to the merely short-run, an
emphasis that has been arguably a defining characteristic of modern capi-
talism” (122).
Economic Experiments by Anthropologists
The Ultimatum Game is the most common economic experiment that

anthropologists have carried out in their cross-cultural studies. The game
is designed to measure the extent to which responders will sacrifice their
own money to punish a proposer who has been unfair. A key feature of
the game is that it is a one-shot affair played between anonymous par-
ticipants; one’s behavior in the game (unlike much interaction in real
life) has no influence on future socioeconomic relations. The Ultima-
tum Game, therefore, is supposed to provide some indication of abstract
society-wide values concerning fairness in socioeconomic exchange be-
tween strangers. The first Ultimatum Game experiment took place two
decades ago (Güth, Schmittberger, and Schwarze 1982); since then hun-
dreds have been carried out (Oosterbeek, Sloof, and van de Kuilen 2004).
Social scientists have shown so much interest in the Ultimatum Game
because participants’ behavior seems to violate the principles of rational
choice. Economists generally assume that decision makers seek to either
maximize gains or minimize losses of some type. In many situations, fig-
uring out which behavior is “most rational” is far from obvious, and we
cannot easily say whether individuals are acting as economic theory would
predict. The best strategy for the responder in the Ultimatum Game,
however, seems straightforward—accept whatever the proposer offers.
Otherwise, the responder gets nothing. The best game theory strategy for
the proposer is only a bit harder to grasp. Because the responder should
accept any offer, the proposer should suggest the division of the stake that
leaves the responder with the least possible amount of money. But in ex-
periment after experiment with university students, many respondents
have been willing to reject what they regard as unfair offers. Proposers,
apparently aware of the possibility of rejection, typically make offers that
leave respondents with a substantial portion of the stake.
Accounts of these results often regard rejections of low offers in the
Ultimatum Game as a puzzle to be explained. Why should participants
care about fairness in this context? Furthermore, even among university
students there is considerable variability in different countries in both the
average size of offers and responses to similar-size offers. Are there inter-
cultural differences in “selfishness”? If so, what are the causes of these
differences?
Psychologists and economists have given two principal interpretations
of the results of Ultimatum Games. Some scholars (including Fehr and
Gachter 2002 and Nowak, Page, and Sigmund 2000) emphasize similari-
ties in results, seeing them as evidence that our hunter-gatherer ancestors
evolved an emotional apparatus favoring generosity in situations where
sharing was necessary for survival. Others (for example, Roth et al. 1991)
emphasize variability in results, seeing them as evidence that cultures dif-
fer in their emphases on the importance of sharing and fairness.
The behavior of the Machiguenga in Henrich’s experiment in the sum-
mer of 1996 differed considerably from that of the university students
who had previously played the Ultimatum Game. Students often rejected
offers; proposers typically suggested almost equal divisions of the stake.
Among the Machiguenga an offer was only once rejected; the proposers’
average offer to the recipient was only 15 percent of the stake. These dif-
ferences cannot be facilely explained by the greater importance of money
for the Machiguenga. The stake in the Machiguenga experiment was the
equivalent of a day’s wages, the same as that offered in most games played
by university students.
Henrich’s experiment attracted attention because the large differences
between how the Machiguenga and university students played the game
suggested that culture influenced notions of fairness considerably more
than had previously been thought. Moreover, ideas about the innate gen-
erosity of hunter-gatherers might be questioned since the Machiguenga
(though primarily shifting cultivators rather than foragers) made such low
offers. Funding agencies were therefore receptive when anthropologists
sought support for comparative studies of economic experiments in set-
tings very different from where the great majority of Ultimatum Games
had previously been played.
The economic experiments by anthropologists aim at providing cross-
cultural and cross-species perspectives on theories about selfishness by
biologists and economists. They therefore have focused on
• cross-cultural variations in generosity (conceived of as either “altru-

ism” or “fairness”)
• the extent to which individuals in different societies are willing to in-
cur costs in order to punish selfish behavior
• differences in the amount of generosity exhibited by participants in
the Ultimatum and related games between foraging societies where
reciprocity is the principal means of exchange and state societies with
well-developed markets
• the degree to which “prosocial” cultural activities such as food
sharing, communal labor, and contributions to public feasts are re-
flected in behavior in experimental games.
The best summary of cross-cultural economic experiments can be

found in Foundations of Human Sociality (Henrich et al. 2004), an edited
collection with contributions from most of the major researchers in this
field. The research sites examined in the book are described in its “Over-
view and Synthesis” (10) as consisting of “fifteen small-scale societies
(from twelve countries on four continents and New Guinea) . . . [that in-
clude] three foraging societies, six that practice slash-and-burn agricul-
ture, four nomadic herding groups, and two sedentary, small-scale agri-
cultural societies.” This is an oversimplified classification of economies in

places where people have multiple sources of food and income and have
been affected to varying extents by colonialism, international trade, and
globalization. Although this simplification is doubtless related to the re-
searchers’ goal of placing their findings in an evolutionary framework,
many readers might question, for example, whether the “foraging groups”
described can really be regarded as representative of “hunter-gatherer
economies” in the past. The three “foraging societies” appear to be the
Hadza of Tanzania, the Au and Gnau of New Guinea, and the Lamalera
of Indonesia. Only the Hadza are characterized as being purely forag-
ing. The Au and Gnau are described as “foraging/horticulture,” while the
Lamalera are listed as “foraging/trade.” (The Ache of Paraguay are de-
scribed as “horticulture/foraging.”) Of the 1,000 Hadza in the study re-
gion, 300–400 were full-time foragers. The Ultimatum Game was played
with the full-time foragers, but they clearly had contact with their nonfor-
aging neighbors. The principal dietary staple of the Au and Gnau is starch
extracted from sago palm raised in semi-wild stands. The Au and Gnau
also practice pig husbandry and raise cocoa as a cash crop. The Lamelera
trade whale meat and fish for agricultural goods, pots, and cloth. Tourism
and cash remittances from wage laborers working elsewhere are signifi-
cant income sources. To state the obvious, our hunter-gatherer ancestors
did not raise crops and animals, trade with nonforagers, work as wage
laborers, receive cash remittances, or welcome tourists.
In each case study experimenters compared how different groups
played the Ultimatum Game, usually attempting to test hypotheses about
intergroup variation. The hypotheses and groups selected for analyses
varied greatly. Criteria for assigning participants to groups included eth-
nicity, place of residence, degree of market integration, occupation, and
whether one lived in a community that had recently been resettled.
The researchers often attempted to see if the results of experimental
games reflected local norms concerning exchange. Jean Ensminger nicely
expresses the reasoning:
It is conceivable that in the context of many small-scale societies, guar-

anteed perfect Anonymity is a rare event—so much so that people be-
have in many contexts as if their behavior will be known. Thus, we might
find behavior in one-shot games consistent with behavior more appropri-
ate to repeated games. Put simply, people invoke “rules of thumb” cued
by reminders of familiar circumstances when faced by a completely novel
situation, as might occur in an economic experiment. (2004:358)
Not every contributor to the volume accepts this argument. Michael

Gurven, unable to find a relationship among the Tsimane of Bolivia be-
tween market exposure and behavior in two experimental games, writes:
The endowment of the games represents a “windfall”—a large sum ob-

tained without any cost. It is unclear whether rules of thumb or cultural
norms designed to direct costly acts of cooperation apply for cooperative
acts that are relatively costless. Deciding how much of a windfall should
go to others more accurately requires an economics of etiquette or man-
ners. (2004:226)
Two examples illustrate the parallels that some researchers found be-
tween local patterns of exchange and the results of experimental games.
Under Ensminger’s supervision, the Orma of northern Kenya played the
“public goods game.”4 Many participants saw a resemblance between this
game and harambee, a local institution of village-level contributions for
community projects such as school building. The Kenyan government for
many years has encouraged harambee fund raising as a method of com-
munity development. The norms associated with harambee, Ensminger
says, were applied to the public goods game. Michael Alvard found that
the Lamalera of Indonesia tend to make “fair” (relatively equitable) offers
in the Ultimatum Game. The Lamalera obtain much of their food from
cooperative whale hunting. Alvard argues that in big-game hunting soci-
eties the rewards for fairness in meat distribution are clear. He says, “To
the extent that achieving such fairness is critical for subsistence, we expect
fairness to be expressed in the Ultimatum Game” (2004:428).5
Because many of the contributors to Foundations of Human Sociality are
sympathetic to evolutionary psychology, they often frame their discus-
sions in terms of the supposed pan-human genetic universals suggested
by the book’s title. Only two case studies (by Abigail Barr and Jean Ens-
minger) make no references to theories about such cognitive universals.
Such theories are always respectfully considered, though some experi-
menters (especially Richard McElreath) note their limitations. In my
view, the emphasis on evolutionary psychology is the weakest theoretical
aspect of the project because a pan-human cognitive architecture obvi-
ously cannot explain intracultural and intercultural variation in experi-
mental results. The contributors’ contorted attempts to escape this di-
lemma are unconvincing. Here are a few of many examples that could be
cited in which authors allude to evolutionary ideas in ways that do little
to aid our understanding of variability in the experimental findings:
Are there innate social grammars for acquiring contextually specific rules
and cues about fairness, cooperation, and punishment? (Henrich and
Smith 2004:164–165)
Understanding how cooperation works under realistic conditions is the

key next step of understanding the variation seen in the results of the
Ultimatum Game. Indeed, in retrospect, given the costs in maintaining
and enforcing norms, it makes evolutionary sense that such norms not be
fixed but rather vary in adaptive ways. (Alvard 2004:431–432)
In many situations it is probably adaptive to assess welfare relatively since

Darwinian fitness is relative. Spite makes sense if the endgame is relative
success. People may use a conditional strategy to evaluate their welfare
in relative or absolute terms depending on the circumstances. When the
benefit of an absolute gain would ultimately add less to one’s fitness than
preventing another from gaining the upper hand, people may behave in
a way that only appears to be spiteful, but is actually rational. (Marlowe
2004:190–191)
If our genetic emotional apparatus allows variation in the degree of co-

operative behavior in different circumstances, how can evolutionary psy-
chology aid in our understanding of generosity and selfishness in the Ulti-
matum Game?
The authors of the “Overview and Synthesis” of Foundations of Human
Sociality had a hard task. The heterogeneity of the case studies, with the
only constant the Ultimatum Game, made generalization difficult. The
experimenters often (admirably) report findings that do not support hy-
potheses underlying the project. Here, for example, are two cases in which
the game results seem unrelated to cultural influences:
[R]esponses in the games shows [sic] no significant association with

real-life behaviors such as measured time preference, previously mea-
sured food-sharing generosity, or variation in food production. (Hill and
Gurven 2004:408)
The Hadza made lower offers in . . . the Ultimatum Game . . . than is

typical of complex societies. The result is especially interesting given
the Hadza can only be described as extremely egalitarian, with a strong
sharing ethic. . . . Perhaps the more frequently one must share, the more
weary one grows of it, and the more one looks for any opportunity to es-
cape it. (Marlowe 2004: 187)
Furthermore, correlations between variables that are positive in some

places are nonexistent in others. David Tracer finds a positive relation-
ship between degree of market integration and size of offer in the Ultima-
tum Game among the Au and Gnau of New Guinea (2004:253); Michael
Gurven finds no such relationship in lowland Bolivia (2004:210–212).
Richard McElreath finds that age correlates positively with size of offer
among the Sangu of Tanzania (2004:340); Joseph Henrich and Natalie
Smith find no relationship between these two variables among the Ma-
puche of Chile (2004:136–139).
Despite these problems, the authors of the synthesis chapter say (10–
11) that the results of the project can be summarized in five points:
1. There is no society where people play the Ultimatum and related

games as economics textbooks would predict (as income maximizers).
2. There is much more variation among groups in game playing than
had previously been reported.
3. Differences between societies in market integration and the impor-
tance of cooperation explain a substantial portion of the behavioral
variation between groups.
4. Individual-level economic and demographic variables do not explain
behavior within or between groups.
5. Experimental play often mirrors patterns of interaction in everyday
life.
Four of these findings are either not particularly interesting or only

weakly supported by the case studies. Because income-maximizing be-
havior has not often been found among university students playing the
Ultimatum Game, there would be no particular reason to expect decision
makers anywhere else to make what classical economics would consider
to be “rational” offers. Surprisingly, a table in the synthesis chapter (25)
clearly shows that the mean offers of three groups (Hadza, Orma, and
Sangu farmers) were in fact income maximizing, given the rate of rejec-
tions. However, the rejection rate in all the case studies was higher than
would be predicted by rational choice theory.
One of the principal objectives of the researchers in Foundations in
Human Sociality was to conduct experimental games among a greater
diversity of groups than had been represented in previous studies. It is

therefore hardly startling that intergroup variation was higher than had
previously been reported. I think it is more interesting that individual-
level economic and demographic variables did not for the most part ex-
plain game-related behavior within or between groups. Such variables
have been shown to have significant effects on economic decision making
in many settings and are often the starting points for analysis. However,
the authors of the case studies rarely present theoretical reasons why the
particular individual-level variables isolated for analysis (age, gender, rela-
tive wealth) should affect behavior in the games they supervised. In the
absence of plausible connections among particular individual-level vari-
ables, offer sizes, and rejection rates, we cannot assess the significance of
negative results.
The evidence that experimental play often mirrors interaction patterns
in daily life is soft by the rigorous standards that the project contribu-
tors extol. As noted, in some cases behavior in experimental games did
not reflect such patterns in hypothesized ways. Even when the behavior
in games did seem to have parallels to real-life exchanges, the evidence
presented is qualitative and descriptive. Such a mode of explanation is en-
tirely satisfactory to many sociocultural anthropologists (including my-
self ) but certainly falls short of the type of “science” advocated elsewhere
by project personnel. In any case, the authors of the book’s overview are
uncertain about the nature of the relationship between everyday life and
game playing:
[W]e are unclear about some important details of how local situations
influence behaviors. Two plausible interpretations come to mind. Per-
haps different social and physical environments foster the development
of differing generalized behavioral dispositions that are applicable across
many domains . . . In contrast, our abstract game structure may cue one
or more highly context specific behavioral rules . . . According to this in-
terpretation, our subjects were first identifying the kind of situation they
were in, seeking analogs in daily life, and then acting in an appropriate
manner . . . These two approaches are difficult to distinguish empirically
and our dataset does not help us judge their relative importance. (48)
An assessment of Foundations in Human Sociality rests on claims that

the economic experiments described in the volume help us understand
fundamental questions about human nature related to selfishness and co-
operation and show that people living in societies highly integrated into
market economies are more willing to be fair to strangers in economic ex-

changes than people living in societies less integrated into market econo-
mies. The case studies in the book tell us little about human propensities
to selfishness or cooperation. Although many of the experimenters relate
their findings to evolutionary psychology, they usually do so in a perfunc-
tory way. They are particularly bedeviled by the finding that foragers—
assumed by evolutionary psychologists to have developed cooperation
among close kin to increase their chances of propagating their genes—are
more selfish in their game playing than their counterparts in more market-
oriented societies. In practice, the experimenters place more weight on
parallels between the results of the games and local institutions and cul-
tural conventions related to economic exchange.
The relationship between immersion into markets and norms of reci-
procity with relatives, friends, acquaintances, business partners, and
strangers is a question of central interest to many historians and social
scientists. The contributors to Foundations of Human Sociality find that
economic experiments like the Ultimatum Game can improve our under-
standing of this relationship. Most anthropologists would likely prefer
to find out about norms concerning economic exchange via more con-
ventional ethnographic methods such as interviews, observations, case
studies, and surveys. While some of these methods (case studies, observa-
tions) would not readily allow cross-cultural comparisons, others (struc-
tured interviews, surveys) would. Furthermore, as many of the experi-
menters point out, it is not at all clear that participants in the games were
treating their partners as “strangers.”
Even if we accept the project’s methodology and conclusions, should
we be startled by a finding that greater market integration is associated
with greater willingness to treat strangers fairly in economic exchange?
Anthropologists have long emphasized the importance of kinship in eco-
nomic exchanges in places where markets are either absent or of limited
importance. In such places kin are usually treated better in economic ex-
changes than strangers (Sahlins 1972:196–210). Because most exchange
is with kin, a lack of trust of strangers does not threaten one’s economic
livelihood. In larger-scale societies, people spend more time in economic
exchange with either distant kin or complete strangers. In such exchanges,
it becomes an economic necessity to have a certain amount of trust in
particular types of strangers, and generalized norms of fair play develop.
More generally, anthropologists such as Robert Redfield (1947) and
sociologists such as Louis Wirth (1938) argued many years ago that so-
cial relations are fundamentally different in small-scale and large-scale
societies. In small-scale societies, norms of behavior between individuals

are governed by particularistic rules often based on kinship relations. In
large-scale societies, where interactions with strangers are common, more
generalized (universal) norms govern interactions. The findings reported
in Foundations of Human Sociality would not surprise Redfield and Wirth.
Although behavioral economics continues to flourish, anthropologists
seem to have become less enthusiastic about the promise of economic ex-
periments in the years since the publication of Foundations of Human Soci-
ality. Fewer articles on this topic are appearing in major anthropological
journals. Furthermore, those anthropologists continuing to conduct eco-
nomic experiments have been placing more emphasis on the frequent lack
of correspondence between how people act in games and their behavior
in real-world situations.
While questions about the relationship between decision making in
laboratory experiments and real-world choices would occur immedi-
ately to most anthropologists, behavioral economists have published few
relevant empirical studies. In a recent article, however, two prominent
economists discuss in detail problems associated with drawing inferences
about the real world from experimental studies. Steven Levitt and John
List (2007) argue that behavior in laboratories is influenced by moral and
ethical considerations, the nature and extent of the scrutiny of partici-
pants’ actions, and the context in which decisions take place. They say
these problems are especially relevant for experiments like the Ultimatum
Game that have a strong moral component. Levitt and List suggest that
participants interacting with anonymous strangers in laboratory experi-
ments are likely to be less prosocial (cooperative) than they are in daily
economic exchanges with kin and friends. On the other hand, participants
in laboratory experiments may be more prosocial than they are in real-
world dealings in financial markets. Levitt and List’s discussion is mostly
conjectural; they present only a few sketchy cases in which researchers at-
tempt to compare laboratory and real-life decision making.
Three recent anthropological studies examine this issue in more depth.
Polly Wiessner (2009) played the Ultimatum and Dictator games with
the Ju/’hoansi Bushmen of southern Africa. In the Dictator Game, pro-
posers have a fixed amount of money, from which they are obligated to
give some—as little or as much as they want—to responders. Respond-
ers must accept whatever offer is made. The Ju/’hoansi proposer offered
relatively low sums of money in both games; responders in the Ultima-
tum Game rarely punished low offers by declining them. Wiessner then
observed what participants in the experiments did with the money they
earned. Participants readily shared food they bought with their winnings
with many of their neighbors. They would not, however, share food with
people with whom they had recently quarreled. Wiessner concludes, as
Levitt and List would guess, that the Ju/’hoansi were much more likely
to be “highly self-regarding” (selfish) when there were no faces of loved
ones or friends present to make them want to share, especially in those
experimental situations when the social conventions that influence every-
day sharing and the punishment of free riders seemed irrelevant.
Michael Gurven and Jeffrey Winking (2008) conducted a more de-
tailed study along the same lines among the Tsimane of Bolivia. The Tsi-
mane played the Ultimatum and Dictator games and the related Third-
Party Punishment Game. The Tsimanes’ offers and rates of rejection were
low, similar to those of the Ju/’hoansi. Gurven and Winking also exam-
ined the extent to which the Tsimane exhibited prosocial behavior in ac-
tivities such as digging a communal well, sharing food, and contribut-
ing to a public feast. They found that the Tsimane, again resembling the
Ju/’hoansi, were more prosocial in real-life situations than in experimen-
tal games. However, the amount of prosociality the Tsimane exhibited in
real-life situations varied considerably, with people overall being more
cooperative in some contexts than in others.
Natalie Henrich and Joseph Henrich (2007:171–173) compare the ac-
tions of Arab-American Chaldeans in Detroit in the Ultimatum and Dic-
tator games with their cultural attitudes toward business dealings and
charitable giving. The Chaldeans made more generous offers in the Dic-
tator Game than in the Ultimatum Game. This seems counterintuitive
because responders in the Ultimatum Game, unlike those in the Dicta-
tor Game, have the option of refusing an offer. Henrich and Henrich in-
terpret this surprising result in terms of cultural models evoked by the
two games. The Ultimatum Game, they say, triggers a business model in
which there is motivation both to cooperate and to pursue self-interest.
The Dictator Game evokes cultural norms associated with charitable
giving that value generosity toward others.
Gurven and Winking, Wiessner, and Henrich and Henrich all say, as
would any anthropologist, that cultural norms affect the extent of co-
operative behavior in real-life situations. They agree that the amount
of prosocial behavior is context- dependent; people who are coopera-
tive in certain situations will be selfish in other circumstances. Henrich
and Henrich point out that when experimental games resemble real-life
situations, the relevant cultural norms will influence decisions such as the
amount to offer in a game. Wiessner and Gurven and Winking empha-
size differences between experimental games and real-life situations and

say that cultural norms are often of little use in predicting game behavior.
Each of these anthropologists has added to our knowledge of how and
when cultural norms related to prosociality affect behavior in the Ultima-
tum Game and other experimental games. But the goal of anthropology is
not to learn how people play such games; it is to describe and understand
their behavior in the world outside the laboratory.
Conclusions
Social scientists and biologists have long been interested in the reasons
people cooperate with one another. The evolution of the capacity for cul-
ture has allowed humans to work together in ways that are impossible for
other animals. Such cooperation is a major reason our species dominates
the planet. However, cooperation often entails short-term costs for some
participants in exchanges. For this reason cooperation is not inevitable;
free riding and other selfish behavior is common.
The principal explanations offered by biologists and economists for
why people sometimes cooperate have serious shortcomings. The biolo-
gists’ focus on kin selection ignores the immense amount of human co-
operation with nonrelatives. The economists’ rational choice theories
work well when cooperative behavior is useful for all parties involved, but
they falter when trying to explain why some individuals make costly sac-
rifices to help others. Anthropologists usually explain cooperative activi-
ties with reference to their usefulness for society as a whole (the “public
good,” in the language of political scientists and economists). Such group-
level explanations are unpalatable to the many evolutionary biologists and
economists whose analyses examine the advantages and disadvantages for
individuals of particular types of behavior. Anthropologists also some-
times attribute cooperation to social norms without paying sufficient at-
tention to how and why such cultural rules develop and change over time.
Many of the goals of anthropologists conducting economic experi-
ments are consistent with the historical roots of their discipline. By carry-
ing out experiments in diverse societies, they provide a cross-cultural per-
spective on previous research done in western industrial countries. These
anthropologists, in marked contrast to most of their counterparts in other
fields conducting economic experiments, emphasize how culture influ-
ences decision making both inside and outside the laboratory. They show
how cultural rules about cooperation in any particular society vary in
different situations. Individuals may cooperate more with kin and close
friends than with strangers. Cooperative behavior may be strongly pre-
scribed in some contexts (in an army unit) and loosely desirable in others
(charitable giving). Anthropologists running economic experiments in
the field sometimes explain behavior in their quasi-laboratories by point-
ing out resemblances between the games played by participants and par-
ticular real-world institutions. In other cases they argue that the lack of
cultural similarities between these games and real-life situations results
in behavior in experiments that seems inconsistent with social norms.
Anthropologists conducting economic experiments have focused
rather narrowly on certain types of cooperative behavior. They have
rarely looked at situations, common in the world outside the laboratory,
in which cooperative behavior is useful in the short run to all parties in-
volved. Instead, their experiments usually involve situations in which co-
operation incurs costs for some participants. They are particularly inter-
ested in the extent to which individuals are willing to incur costs in order
to punish selfish behavior. These emphases come from theoretical debates
about altruism in evolutionary biology and psychology.
The underlying assumption of economic experimentation in anthro-
pology and other disciplines is that behavior in laboratories can tell us
something about the wider world. Anthropologists, economists, and
psychologists writing about this issue have concentrated on the corre-
spondence between abstract experiments and real-life situations. Their
emphasis is on the extent to which social norms in the wider world are re-
flected in decision making by participants in experimental games. While
such discussions are useful, they ignore the principal difficulty with such
games. Economic experiments intentionally create situations in which
variables are carefully defined and measured and the confounding effects
of extraneous factors can be controlled for through manipulation of vari-
ables. In my view such “rigor” results in experiments that diverge too
much from real-life situations to be of much use in understanding social
norms about cooperation and selfishness. The countless economic experi-
ments by anthropologists and other social scientists do not, for example,
aid in my understanding of when and why Oaxacan wood carvers share
information about their techniques, styles, and customers. Their willing-
ness to cooperate with their kin and neighbors in certain circumstances
can only be understood through ethnographically informed analyses of
the history and economics of the wood-carving trade.
CHAPTER 5
Who Makes Household Economic Decisions?
Anthropologists and economists analyzing decision-making situations in

particular times and places need to specify who exactly has the power to
make choices. Before around 1960 economists ordinarily assumed that
decision-making units were either individuals or groups acting as a single
entity. This assumption simplified their models of choice based on neo-
classical economic theory. In the real world, however, many group deci-
sions are the outcomes of discussions between people with conflicting
goals. For example, the firms that are the subject of extensive economic
theorizing have numerous decision makers who may disagree about what
their companies should do in particular situations. Some of these indi-
viduals may exert great amounts of influence in certain types of choices
but have little power to determine the outcome of other kinds of decision-
making situations.
Over the past fifty years anthropologists and economists have be-
come increasingly aware that many important economic decisions are
made within households whose members pool some of their resources.
Although anthropologists have written extensively about problems in de-
fining and delineating “households,” economists for the most part seem
unconcerned about these issues. Both anthropologists and economists,
however, have written extensively about the difficulties associated with
regarding households as decision-making units. They understand that
members of households negotiate and compromise over the use of shared
resources. Anthropologists’ work on intrahousehold negotiations has
mostly been descriptive; economists, in contrast, have developed game
theory models of bargaining among household members. Feminist schol-
ars in the two disciplines have been particularly concerned with how
society-wide gender relations affect the relative influence of women and
Who Makes Household Economic Decisions? 119
men in household decision making. They have also emphasized the con-
siderable autonomy that women and men often have in different spheres
of household economics.
This chapter examines similarities and differences in the ways anthro-
pologists and economists discuss household-level choices. My emphasis
is on how scholars in the two fields define and delineate decision-making
units. I begin with a discussion of problems I encountered in delineating
“households” in the three places I have carried out extended fieldwork—
Belize, the Peruvian Amazon, and Oaxaca. These case studies illustrate
the difficulties that both anthropologists and economists face when at-
tempting to specify who exactly is influencing important household-level
decisions.
Rural Belize in the Early 1970s
When I went to the Stann Creek District in southern Belize in 1971, my

primary goal was to find out how individuals made decisions about how
to allocate their labor time among wage labor, cash cropping, and agri-
cultural production for home consumption. I assumed (without much
thought) that my fieldwork would focus on the choices men made be-
cause rural women in the area rarely participated in wage labor. Although
my assumption about the activities of women turned out to be right, I
quickly learned that the economic decisions of individual men could
not be understood without an examination of what other people in their
households were doing.
Families supported themselves through a diverse mix of activities that
included growing rice, corn, beans, plantains, cassava (manioc), and citrus
crops, raising chickens and pigs, fishing, hunting, and doing migratory
wage work in construction and on commercial estates. Men considering
leaving home to do wage work relied on other members of their house-
holds to maintain their fields, tend to chickens, take care of children, pre-
pare food, mend clothes, and do other domestic tasks. Furthermore, the
total amount of time men spent on wage work and farming each year de-
pended in part on how much food and income they needed to support
their families at a culturally acceptable standard of living. Men with large
families needed more income and food (whether grown or purchased)
than men with smaller families. Men who were the only wage workers in
their households needed higher incomes than those who had adult sons in
their households who shared some of the money they earned.
It became clear to me that an exclusive focus on individual decision

making was misguided. Because the economic activities of various mem-
bers of a household were interrelated, analyzing the choices any one per-
son made could not be done without looking at the choices of others.
More fundamentally, I wondered about the extent to which the economic
activities of rural Belizean households could be regarded as the outcomes
of independent decisions made by individual members. There was clearly
some group decision making in households that affected some activities of
individual members. However, neither the household as a group nor any
one member could dictate all economic activities. My original assump-
tions about decision making were not entirely wrong; individuals did have
considerable autonomy in allocating their labor time.
Despite my eventual recognition of the importance of household deci-
sion making, there can be no question that my Belizean research paid far
too little attention to the influence of women on economic decisions. This
was doubtless partly because the fieldwork was carried out before femi-
nist critiques of male-centered ethnography became widely accepted. But
it was also because as a young single male I had easier access to the world
of men.
Some of the data I collected in Belize came from a household sur-
vey I conducted in three villages in the spring of 1972. Although I lived
some of the time in one of these villages and knew many people there, I
was less familiar with the other two communities. I conducted a survey
of households because they were widely regarded as important socioeco-
nomic units by anthropologists, sociologists, historians, and census takers
in diverse times and places. I knew, however, that there could be difficult
problems defining and delineating households, especially in the Carib-
bean cultural area where Belize was ordinarily included. I worried about
such problems before and during the survey and while attempting to ana-
lyze my data after returning from the field.
Many of these definitional and boundary problems arose from my
efforts to collect a basic piece of information, the number of people oc-
cupying particular dwellings. Simply asking how many people lived in
a place did not work all that well. Some people spent part of their time
in the residence I was censusing and part of their time somewhere else.
These included migrant laborers, students at a high school in a nearby
town, and people who moved back and forth between their communities
and other parts of Belize. There were also many young men (and some
not-so-young men) who lived most of the time with their parents but
had longtime relationships with women in other dwellings. Many of these
men had children with the women, provided them with money, and spent
significant amounts of time at their place. Such arrangements were com-
mon among the Creoles and Caribs (Garifuna) in the area, as they are in
other Afro-Caribbean communities. They were, however, rare among the
Mayas who comprised about a quarter of the population in one of the vil-
lages where I conducted the survey.
Boundary issues were especially problematic in compounds of two or
more dwellings occupied by related families. One house in these com-
pounds usually consisted of an older couple, one or more of their children,
and perhaps also grandchildren. Adult sons and daughters lived in nearby
houses with their spouses and children.1 There was considerable variation
in the extent to which the residents of different dwellings within a com-
pound shared land, helped one another economically, ate together, and in
other ways pooled resources. Because such cooperation and sharing was
always partial, I struggled in my efforts to determine how many house-
holds there were in a compound.
In an appendix to my dissertation I note some of these difficulties:
My original intention was to have a sample of 60, 20 from each village.

Sixty interviews were made, but after they were compiled it was found in
a number of cases that errors had been made in regarding certain house-
holds as independent economic units. The most common mistake discov-
ered was where men and their fathers lived in different households but
worked together in some way. For example, in one case in Silk Grass a
father provided the capital and land for a citrus orchard and the son pro-
vided the labor. In addition both father and son did a little milpa [shift-
ing cultivation] farming for their own household. In such cases I usually
regarded the father and son as belonging to the same economic unit and
combined the households in the survey. In addition, a few old men had
to be dropped from the sample since although they did do some farm-
ing, their household was not really an independent economic unit since
the bulk of its income came from gifts from their children. (Chibnik
1975:250)
If I were to rewrite this today, I would phrase my findings differently.

What I wrote implies that finding households that were independent eco-
nomic units was unproblematic in cases other than the ones mentioned.
Surely there were many other cases of interdependent households in
which some pooling of resources occurred. But I cannot be too critical
of these analytic choices I made many years ago. If I wanted to compare
household economic strategies, I had to make decisions, however imper-

fect, about which people belonged to particular households.
Although I did not think much about it at the time, in some cases
there were also difficult problems regarding all the residents of particular
dwellings as being members of resource-pooling households. This ana-
lytic quandary arises in many places but is especially important in Belize
where unmarried adults (with or without co-resident children) often live
in houses with their parents. The degree to which such adults pool re-
sources with their parents may not be very different from situations in
which parents and children occupy separate houses in compounds. None-
theless, in practice I always regarded all the residents of a dwelling as be-
longing to the same household.
Twenty-five years after I conducted this research, Richard Wilk and
Steven Miller wrote a perceptive article (1997) in which they defined
four categories of household membership in Crooked Tree, an Afro-
Caribbean Belizean community similar to two of the three villages where
I conducted my surveys:
1. Full-time residents sleep in the unit every night, and contribute a

major portion of their income to a domestic fund. However, they do
not necessarily eat all their meals there.
2. Part-time residents have another residence outside the community,
and sleep in their Crooked Tree household a minimum of once or
twice a month. They are expected to contribute a smaller portion
of their income to the domestic fund, and have the right to become
full-time residents in the future . . .
3. Absent members live full-time in another community, but retain
the right to return and become residents in the Crooked Tree
household . . .
4. Visitors are people who do not sleep in the household, but who have
a specific long-term economic and social relationship with it. Most
often they are what we called “people who eat but don’t sleep.” . . .
Young men or women may also become visitors in a household where
they have a girlfriend or boyfriend and/or children. A visiting mem-
ber may receive other services like clothes washing, use of tools, and
storage of personal effects, and they may give contributions of labor,
goods, and cash to the household. (67–68)
This is certainly a more accurate way to categorize residents of Beli-

zean households than simply describing them as members or nonmem-
bers. But even if I had collected this information I am not sure how much
it would have helped me make statistical comparisons of the economic ac-
tivities of households of different types. I still would have had to confront
the fundamental problem of counting the “number of members” in each
household. I suppose that some formula could have been devised to count
the part-time, visiting, and absent members as fractional people, but any
such methods would have been quite arbitrary. In any case, two house-
holds having, say, 5.65 members might differ considerably in their propor-
tion of full-time, part-time, absent, and visiting “residents.” Furthermore,
the alternative of abandoning “number of members of a household” as a
survey category would have precluded all kinds of useful comparisons.
The Peruvian Amazon in the Mid-1980s
When I carried out fieldwork in the Peruvian Amazon in the mid-1980s, I

was more sophisticated about the complexities of delineating households
as economic units than I had been during my Belize research in the previ-
ous decade. In the intervening years, anthropologists and historians had
written extensively about household definitions and boundaries (among
them Netting, Wilk, and Arnould 1984 and Wachter, Hammel, and Las-
lett 1978). I had contributed in a small way to this literature, writing an
article about the relationship between household composition and agri-
cultural production (Chibnik 1984) and helping to organize a conference
in Iowa City in 1983 on “household economies and their transformations”
that eventually resulted in an edited collection (Maclachlan 1987).
An important part of my research in Peru was an examination of the
economic strategies that households of farmers in three floodplain vil-
lages used to cope with the annual rise and fall of the Amazon River. To
gain an understanding of these strategies I decided to survey every farm-
ing household in the villages about their economic activities in 1984 and
1985.2 I was, of course, by now hyperconscious about whether households
were really the best economic units with which to conduct my analysis. I
was reassured by an offhand comment by my friend Christine Padoch, an
anthropologist affiliated with the New York Botanical Garden who was
in the midst of long-term research on ribereño cultural ecology. Con-
trasting the ribereños with the self-identified Indians (indígenas) of the
region, Christine remarked that “they [the ribereños] are really classic
peasants.” What she meant by this is that ribereños lived in discrete, land-
owning households that pooled resources, grew most of their food for
home consumption, sold some crops, and were integrated into the Peru-
vian state.
As Christine had suggested, delineating household boundaries was
much less problematic in Peru than it had been in Belize. In the book I
later wrote about my Peruvian research, I devoted only a paragraph to
this topic:
In many parts of the world, households cannot be clearly delineated, be-

cause units of production and consumption may not coincide with one
another (Netting et al. 1984; Wilk 1989). Some resources may be shared
among people in two or more dwellings, while other resources may not
be shared within a dwelling. In the ribereño communities of the Peru-
vian Amazon, a researcher who assumes that residents of a particular
dwelling constitute one and only one independent household can some-
times get a misleading picture of economic relations. Such an assump-
tion is especially problematic for dwellings inhabited by more than two
adults. Nonetheless, the residents of most dwellings in riverine villages
can be regarded as members of more-or-less discrete households, which
are usually units of both production and consumption. Residents eat
together, share possessions, and pool the results of their labor. Most
dwelling units are economically self-sufficient. They include an adult
male and an adult female, produce most of what is consumed, and receive
only occasional monetary infusions from relatives living elsewhere. I . . .
[therefore] assume [in the rest of the book] that the residents of a dwell-
ing constitute a household. (Chibnik 1994:102–103)
Looking at these printed pages nowadays, I can recall my sigh of re-

lief while writing this paragraph that I would not have to deal with this
issue anymore. Nonetheless, the situation was not quite as simple as I
suggested. Of the 82 households I surveyed, 33 included more than two
adults. Eleven of these households included two or more couples. There
were an additional 3 households without any couples, all of which relied
heavily on interhousehold pooling of resources. Thus 33 of the 82 dwell-
ings had compositions suggesting that pooling of resources was likely to
be only partial; another 3 were clearly not autonomous.
My paragraph also overstated the self-sufficiency of ribereño house-
holds. In all three communities, cooperative work groups were used in
agriculture. These took two forms. In exchange labor groups, farmers
worked on each other’s fields on a rotating basis. The food and drink
served to guests was not much better than ordinary, and the amount of
work each group member provided for others was reciprocated almost
exactly. In festive work parties, farmers issued an invitation to neighbors
to work on a particular task such as clearing a field or harvesting. The host
family was expected to provide extraordinary food and drink but had little
or no obligation to attend future work parties called by guests. Each vil-
lage also had communal work days when households had to either send a
representative or pay a small fine. Typical tasks were cleaning paths, clear-
ing the schoolyard and soccer fields, constructing a community center,
and working a small plot of collectively farmed land.
Artisan Communities in Oaxaca since 1994
Although I have spent some time examining economic strategies in wood-

carving households in rural Oaxaca (for example, Chibnik 2003:80–93),
this has not been a major focus of my fieldwork. My research instead
has emphasized socioeconomic relations between wood-carving families
and the tourists, store owners, and wholesalers who buy their pieces. My
publications on Oaxaca have been more descriptive and less quantitative
(and quite likely more readable) than my earlier writings about Belize and
Peru. Because of the qualitative nature of much of my Oaxacan fieldwork,
I have not had to confront problems of household boundaries as directly
as I did in my previous studies that depended more on information col-
lected in surveys. I did, nonetheless, carry out an unsystematic survey of
thirty-two artisan households that forced me to consider boundary issues.
I have also collected numerous life histories and economic case studies
that include information on household composition.
If one created a tight–loose scale measuring the extent to which house-
holds (however delineated) are independent economic units, Oaxacan
artisans would occupy an intermediate position between ribereños and
Belizeans. In the two wood-carving communities where I conducted most
of my fieldwork, one or more married adult sons or daughters (many with
their children) often lived in compounds alongside their parents. Al-
though the younger couples and their parents sometimes lived in separate
dwellings, they more commonly occupied rooms in horizontally expand-
ing concrete houses.
The economic relationships in these compounds were complex and
variable. Younger couples sometimes ate with their parents but usually
took meals separately. Grandparents cared for grandchildren; sons and
daughters cared for elderly parents. Adult children worked in fields along-
side their parents. There were often two or more semi-independent wood-
carving workshops in compounds where knives, brushes, and paints were
shared.
Although the Oaxacan communities where I have conducted research
over the past two decades are far from wealthy, households there have
a much higher standard of living (however measured) than the Belize-
ans and Peruvians in my previous field settings. Because the Oaxacans
have more money, economic relationships between parents and children
(whether living in the same dwelling or different dwellings) are more
complicated than those I observed in earlier research. Women and teen-
age children in contemporary Oaxacan artisan communities have many
more opportunities for earning income than their counterparts in rural
Belize in the 1970s and the Peruvian Amazon in the 1980s.3 They can paint
or carve on a piecework basis for artisans in other households, make tor-
tillas for sale in marketplaces, and commute by bus or collective taxi to
jobs in the nearby city of Oaxaca. Women and children also do more than
half of the labor on most Oaxacan wood carvings. Money from artisan
sales is usually pooled, with wives having considerable control over how it
is used. The money that household members earn in other ways (includ-
ing wage work by adult men) may or may not be shared.
Cooperative agricultural work parties composed of members of dif-
ferent households are rare in rural Oaxacan communities. Nonethe-
less, overall there is more interhousehold cooperation in Oaxaca than
in either Belize or the Peruvian Amazon. Communal service on public
works (locally called tequio) is similar to analogous arrangements in Peru
but more frequent and time-consuming (Cohen 1999:114–118). In addi-
tion, many communities (including all the places I did fieldwork) have
a local political system in which all adult men (and in some places also
adult women) are required to spend years in unpaid governmental posi-
tions (Clarke 2000:192–197). Most communities also have guelaguetza, an
institutionalized way in which community members can borrow money
from relatives and neighbors to pay for food, drink, and music at saints’
day celebrations, weddings, graduation parties, and other ritual events
(Cohen 1999:190–191, Stephen 2005:268–274).
The biggest difficulty in delineating Oaxacan households is extensive
temporary and permanent migration to the United States (Cohen 2004;
VanWey, Tucker, and McConnell 2005).4 These migrants send large
amounts of money to Oaxaca to their families. Whether to count such
migrants as household members in censuses poses difficult analytic prob-
lems because migrants vary greatly in the degree to which they retain eco-
nomic ties with their families at home.
There have been numerous anthropological studies of rural and urban
Oaxaca based in part on household surveys. An examination of three
such studies shows the variability in the extent to which anthropologists
conducting research in Oaxaca consider the complexity of delineating
households.
Perhaps the most comprehensive socioeconomic survey conducted by
anthropologists in Oaxaca took place between 1978 and 1981 among 952
rural households in the Central Valleys. The book based on this research
(Cook and Binford 1990) includes twenty-eight informative tables giving
data on economic activities in households supporting themselves through
combinations of farming, artisanry, and wage work. Despite the authors’
perceptive, sometimes harsh critiques of the shortcomings of previous
analyses of the economics of “peasant” households, Cook and Binford
do not devote any space at all to discussing how they defined the “house-
holds” included in their tables.
In Social Inequality in Oaxaca (1991), Arthur Murphy and Alex Stepick
show a sophisticated understanding of some of the problems involved
with treating households as economic units:
We use both the words household and family, because they overlap con-
siderably. To Oaxacans . . . family is the more important culturally. The
family is . . . under ideal situations, also coincident with the household.
All family members should live within the household, yet for numerous
reasons, some imposed and others from individual choice, family mem-
bers often do not live together. . . . Households are more constant and
concrete than families, which may become dispersed, move apart, and
later reunite. For these reasons, most of the subsequent discussion refers
to households rather than families. (139)
Murphy and Stepick proceed to define a household as “a social group

living in a single dwelling area, such as a house lot,” recognizing that
“there may be more than one occupied house or structure on a lot, all
under the control of a single head of household” (140). They do not in-
dicate how they determined when people living in separate structures
should be considered as parts of the same household. Their use of the
term “control” is unfortunate, since individual “heads of household”
rarely can dictate all decision making even in social groups living under
the same roof. Although Murphy and Stepick know this, they nonetheless
regard households as more or less unitary decision makers, downplaying
the autonomy of individual members:
Households, not individuals, are . . . the budgeting units . . . Everyone

commits his or her share to the collective and the collective determines
how it will be expended. The decisions about how to spend it may be
made by a patriarchal autocrat or by democratic consensus; regardless,
the household collective forms the basic unit, not the individuals who
compose and contribute to it. (Ibid.)
Jeffrey Cohen more recently (2004) surveyed 590 households in twelve

communities in the Central Valleys in a study of migration from Oaxaca
to the United States. Although Cohen explicitly recognizes definitional
problems and the diversity of household composition, he never says how
exactly “households” were defined for the purpose of his survey:
A household approach meant that we collected data on all members of

the domestic unit. In rural Oaxaca, the household could be difficult to
define. In general, most rural households (63%) were nuclear units living
in independent compounds, quite like their U.S. counterparts. In other
words, the household included members of two generations living in a
single homestead and pooling the resources and skills of their members.
The senior generation consisted of a legally married couple; the junior
generation included the offspring of the seniors. However, some house-
holds in the central valleys included more than two generations and were
better thought of as extended units (35%). Typically, we found extended
units organized around a married couple and their children, with the
addition of a grandparent. Sometimes a household appeared to be an
extended unit but was in fact a series of independent nuclear units that
shared a common area or patio. Finally, some households defied classifi-
cation (2%) and included odd collections of members. (24)
I cannot criticize any of these anthropologists for being imprecise

about how they defined “households” for the purposes of their surveys.
In the majority of cases, people living under one roof formed a cohesive,
relatively independent socioeconomic unit. In more complicated situa-
tions, there may often be no good way to make a list of people who indis-
putably should be regarded as members of the same household.
Table 5.1. Importance of problems in delineating households in three

field sites
Characteristic Belize Peru Oaxaca
Fluid composition of households High Medium High

Resource pooling among kin in two or more High Low High
dwellings
Incomplete resource pooling within dwellings High Low Medium
Autonomy in decision making by individuals within Medium Low Medium
dwellings
Resource pooling with nonrelatives Low Medium High
Common Problems
In my attempts to delineate households as economic units while conduct-

ing fieldwork in varied places, I encountered five general problems:
1. Resource pooling among family members was not restricted to the

residents of single dwellings. In Belize and Oaxaca, for example, there
were compounds of two or more dwellings where residents shared
some, but not all, of their resources.
2. Within dwellings, residents did not completely share resources.
3. Residents of different households had varied degrees of autonomy in
their individual decision making.
4. It was difficult to count the number of people in many households be-
cause of their fluid composition. This was especially difficult in field
settings where temporary migration to other places was common
or where people split their time and resource pooling among two or
more dwellings.
5. In some places (particularly Peru and Oaxaca), there was significant
resource pooling in cooperative work parties and required community
service among unrelated people living in different dwellings.
These problems differed in their importance in Belize, the Peruvian

Amazon, and Oaxaca (table 5.1).
In all three places, however, one or more of these analytic problems
prevented me from unequivocally regarding residents of particular dwell-
ings as households that pooled resources and made decisions as an eco-

nomic unit. Regarding dwellings as household economic units was less
problematic in some field sites than in others. In the Peruvian Amazon
the residents of dwellings pooled most of their resources. Moreover, ribe-
reño communities largely lacked the compounds of related families that
were common in my other field sites. In Belize, in contrast, delineating
households was difficult because of migration and a social structure in
which many men lived in one residence but supported women and chil-
dren living elsewhere. In Oaxaca resource pooling within dwellings was
greater than in Belize but less than in the Peruvian Amazon. In Oaxaca
the major problem than delineating households came from extensive tem-
porary migration to the United States.
Despite these complications, I found it useful to collect household-
level economic data in each of my field sites. For the most part, residents
of dwellings in Belize, the Peruvian Amazon, and Oaxaca did pool many
of their resources. In all three places, the household acted more or less as
a group in many important economic decisions.
Anthropological Approaches
Before around 1960, anthropologists rarely placed much emphasis on

households as economic units (Bender 1967; Netting, Wilk, and Arnould
1984). Some of their best-known comprehensive discussions of social or-
ganization (such as Lowie 1920, Murdock 1949) used the term “house-
hold” infrequently. These discussions concentrated on institutions such
as lineages that ordinarily involved related family members living in more
than one dwelling. Economic activities were usually regarded as em-
bedded in social relations rather than being the results of conscious deci-
sion making by individuals or households weighing the costs and benefits
of alternate actions. Anthropologists’ general lack of interest in decision
making during this period (with such notable exceptions as Raymond
Firth) therefore prevented them from examining households as unitary
economic actors making choices about how to allocate resources. Ana-
lyses of economics by anthropologists focused on kinship obligations,
production methods, exchange systems, and culturally approved divisions
of labor by age and “sex” (now more often called “gender”).
The types of social relations in the field settings of most anthropolo-
gists prior to 1960 may have led to the development of theoretical ap-
proaches that paid relatively little attention to household-level decision
making. The best-known anthropological research during this time took

place in non-state societies where economic exchanges were ordinarily
structured by kin relationships. Anthropologists therefore concentrated
on creating classifications of the bewildering variety of kinship and resi-
dence rules governing such exchanges, focusing less on everyday decision
making by individuals and households. When anthropologists did con-
duct fieldwork in state societies, their research often took place in areas
where suprahousehold social units such as lineages and castes seemed of
more economic importance than households.
By the late 1950s many anthropologists were conducting research in
areas such as Latin America and western industrial countries where much
important economic decision making clearly took place within house-
holds. Anthropologists carrying out research in these and other loca-
tions began placing more emphasis on the distinction between “house-
holds” and “families.” In an introductory textbook, for example, Felix
Keesing wrote (1958:271) that families were organized on the basis of
kinship, while households were defined by locality. Paul Bohannan argued
(1963:86) that “kinship and propinquity do not even belong in the same
universe of discourse.” Donald Bender (1967) provided an extensive dis-
cussion of the concept of “household” in the American Anthropologist, the
flagship journal of the American Anthropological Association. He sug-
gested that this concept referred not only to people occupying a com-
mon residence but also to their carrying out what he called “domestic
functions” (providing food and shelter and raising children). Anticipating
ideas that became widely accepted later, Bender wrote:
One is dealing, then, not with two distinct social phenomena—families

and households—but with three distinct social phenomena, families, co-
residential groups, and domestic functions. All three frequently corre-
spond both ideally and in fact . . . The three also can and sometimes do
vary independently. (495)
Household-level economic studies by anthropologists peaked between

1970 and 1990. There were numerous analyses (for example, Barlett 1980)
of the economic strategies that households, especially in rural areas of
Africa, Asia, and Latin America, used to reduce risk and uncertainty, take
advantage of the varied skills of their members, and deploy efficiently their
land, labor, and capital. This proliferation of household-level studies was
doubtless in part a reaction to economists’ focus on commercial enter-
prises and individual consumers and producers. Many anthropologists
thought that this neglect of household-level decision making downplayed

an important aspect of local, regional, and national economies. Economic
anthropologists were influenced as well by Chayanov’s ideas in the 1920s,
later available in English (1966), about the effects of the demographic
composition of a household on its agricultural practices. Chayanov placed
particular emphasis on how the consumer/worker ratio of a household
changed over time as children were born, grew up, and left. Chayanov’s
work carried out in the 1920s and 1930s was brought to the attention of
many anthropologists by Marshall Sahlins, who emphasized (1972) how
the social organization in particular cultures led households to exchange
agricultural products in ways that evened out imbalances brought about
by their differing consumer/worker ratios. This was not, however, how
most economic anthropologists interpreted Chayanov. Instead, they cre-
ated models (for example, Durrenberger 1984) and carried out statistical
analyses (for example, Chibnik 1984) of how the consumer/worker ratio
affected household agricultural behavior in varied times and places.
Chayanov’s ideas were based on conditions in Russia that differed
from those in many other parts of the world. He assumed that land was
freely available, that there was no market for hired labor, and that most
production was for home consumption. He also assumed, in contrast to
the ways his ideas later were adapted by Sahlins, that households were
more or less discrete economic units. Nonetheless, Chayanov’s basic idea
that household demographic composition affects agriculture production
has been influential in the analysis of economic decision making in parts
of the world where these assumptions are clearly inapplicable (Netting
1993:295–319).
Anthropologists quickly became aware of the diverse problems asso-
ciated with regarding households as independent economic units (Net-
ting, Wilk, and Arnould 1984; Wilk 1989; Yanagisako 1979). The major
problems they raised have already been mentioned in the discussion of the
difficulties delineating household economic units in my field sites. These
include drawing boundaries between households when there is some re-
source pooling among people living in different dwellings, the limited
extent of resource pooling among people living in the same dwelling, the
fluidity of household membership, and the difficulty in specifying house-
hold membership for certain people. Nonetheless, most economic an-
thropologists in the 1970s and 1980s agreed with Peter Kunstadter that
despite the existence of a few ethnographic anomalies, most people in

most societies at most times live in households, membership in which
is usually based on kin relationships of marriage and descent, which are

simultaneously a combination of dwelling unit, a unit of economic co-
operation (at least in distribution and consumption), and the unit within
which most reproduction and early childhood socialization takes place.
Thus, the kin-based household seems to be an important social unit in all
(or almost all) societies, with widely proliferating implications for many
important aspects of behavior. (1984:300)
The rise of household studies in economic anthropology eventually led

to critiques that altogether rejected the idea of households as unitary de-
cision makers. A surprising, if idiosyncratic, critique came from Eugene
Hammel, who had been a leading figure in anthropological and historical
studies of households. He argued in 1984 that interminable arguments
about the definition and delineation of anything at all took place because
“often those engaged in [such] conversation[s] do not know what they are
talking about” (40). The household, according to Hammel, was “simply
not a good unit of observation.” Hammel’s proposed remedy for the igno-
rance of his colleagues is, to say the least, opaque:
The household in any society, I suggest, is that social group larger than
the individual that does not fail to control for its members all those re-
sources that any (adult) member could expect to control for himself. It
maximizes size and corporacy simultaneously. (41)
I have no idea how any anthropologist conducting fieldwork could use this
definition to delineate households.
More enduring critiques came from feminist anthropologists con-
cerned with the relative autonomy and power of women in different
cultures (for example, Clark 1989; Guyer 1981, 1988; Lockwood 1989).
These anthropologists argued that analyses treating households as eco-
nomic units made the implicit assumption that one person, usually a man,
could to a large extent dictate the economic activities of other members.
Their ethnographic research in diverse societies showed convincingly
that the other members of households—in particular, adult women—
often exerted considerable control over how they allocated their labor
and what they did with their earnings. Concentrating on household deci-
sion making, in their view, was a fundamental error that obscured power
relations between men and women. They argued instead for a focus on
the extent to which such power relations allowed autonomous decision
making by men and, especially, women.
In recent years anthropologists have not written much about the extent
to which households can be regarded as unitary, discrete decision-making
economic units. There is general agreement that there are difficulties re-
garding members of single dwellings as isolated resource-pooling entities.
Nonetheless, the household—sometimes loosely defined, more often un-
defined—continues to be an important unit of analysis when economic
anthropologists discuss production, exchange, and consumption. Despite
the cogency of feminist critiques, most anthropologists agree with Kun-
stadter’s pragmatic view that residents of dwellings in most societies pool
some resources and make certain decisions together. Moreover, the world
outside of academia obviously thinks that the household is an important
economic category. Governments collect census data at the household
level. People discussing the economic choices of their “families” ordi-
narily are talking about relatives with whom they share living space.
As more and more anthropologists conduct work in urban areas in
industrial societies, the ways in which they examine household economics
are changing. Many people in such field settings earn most of their in-
comes from jobs outside the home. Anthropologists therefore have been
increasingly interested in how members of households in industrial soci-
eties make choices between paid work outside the home and unpaid do-
mestic work. Economic anthropologists are now paying less attention
to household production strategies than previously and more to deci-
sions about resource pooling and consumption. Overall, contemporary
anthropologists are focusing less on household economics than they did
in the 1970s and 1980s. They instead are spending more time examin-
ing both individual-level decision making and the activities of nonhouse-
hold socioeconomic organizations such as firms, cooperatives, and credit
associations.
Economic Approaches
There are certain resemblances in the ways that economists and anthro-
pologists have looked at households. Prior to the 1960s relatively little
attention in either discipline was given to households as economic units.
Economists and anthropologists then began to analyze many important
choices made at the household level. In the past three decades feminist
scholars in the two fields have emphasized ways individual members of
households, especially women, exercise varying degrees of autonomy in
their economic decision making.
Despite these similarities, no one would mistake the publications of

economists on this topic for those of anthropologists. Economists as a
group are much more concerned with devising formal, mathematically
tractable models of household-level decision making. Anthropologists,
with their “bias towards detailed empiricism” (Chen and Dunn 1996:5),
are more likely to examine on-the-ground activities. Economists are not
much concerned with intracultural and intercultural variation in house-
hold forms; anthropologists usually begin their analyses by describing
such variations. Anthropologists write extensively about the fluid mem-
bership of households and resource pooling among kin living in different
dwellings; economists rarely consider such complexities in their models.
The standard models of neoclassical economics treat production and
consumption separately. The assumption is that business firms and pub-
lic enterprises produce and that individuals and households consume.
Households are treated as unitary decision makers that purchase every-
thing they consume (Chen and Dunn 1996:12–13, Pollak 2003:122–123).
Such models seem clearly inapplicable in the many situations, especially
common in parts of the world where anthropologists often do fieldwork,
in which households produce goods sold in markets. They also ignore the
enormous amounts of unpaid work in households in all societies on tasks
such as child care, cooking, and growing subsistence crops.
Some neoclassical economists long ago were aware of the difficulties
associated with treating households as decision-making units. They won-
dered how the consumption behavior of a household could be modeled if
members differed in their goals (“preferences” in economic jargon). The
attempt of the famous economist Paul Samuelson illustrates how the idea
of unitary households was nonetheless justified:
[We] might try to save the conventional theory by claiming that one
titular head has sovereign power within the family and all of its demands
reflect his (or her) consistent indifference curves. But as casual anthro-
pologists, we all know how unlikely it is in modern Western culture for
one person to “wear the pants.” It is perhaps less unrealistic to adopt the
hypothesis of a consistent “family consensus” that represents a meeting
of the minds or a compromise between them . . . the family acts as if it
were maximizing their joint welfare function. (1956:9–10)
There were some heterodox economists prior to the 1960s who re-
jected some of the assumptions of the neoclassical models. During the
1920s and 1930s, as noted earlier, Chayanov published extensively on the
interrelationship between household production and consumption. At

the same time, Hazel Kyrk (1933) and Margaret Reid (1934) introduced
household economics as an academic specialization in the United States.
They placed particular emphasis on the economic value of time devoted
to unpaid household work (Grossbard-Schechtman 2001:104, Ironmon-
ger 2001, Yi 1996). Reid argued (1934:11) that if an activity such as cook-
ing for one’s family might be delegated to a paid worker, it should be re-
garded as “productive.” Although these scholars’ ideas were influential
within the field of home economics, their work was largely ignored by
mainstream economists, who continued to portray households as places
of only consumption and leisure (Ironmonger 2001).
Classical Marxist economists regarded household production as an
anomaly in advanced capitalism, thinking that over time women would
be drawn into the workforce and become economically independent of
men (Hart 1992:117). This view was challenged during the so-called
Domestic Labor Debate of the 1970s (Seccombe 1974, Himmelweit and
Mohun 1977, Molyneux 1979) by Marxists contending that women’s un-
paid housework was useful to capitalism because their domestic activities
allowed male laborers to be paid low wages. Both early and later Marxists
downplayed the importance of household decisions, seeing such choices
as largely determined by suprahousehold socioeconomic relations such as
conflicts between workers and the owners of capitalist enterprises.
By the 1960s economists were beginning to analyze the implications of
the increasing numbers of married women in the labor force in the United
States (Mincer 1962, for example) and the importance of unpaid house-
hold work in the world economy. The New Household Economics, best
known through the work of Gary Becker, was developed in part to pro-
vide theoretical tools to examine these issues. Among economists, Becker
is celebrated for his observation, not in the least surprising to anthropolo-
gists, that the household is a unit of both production and consumption
even in advanced capitalist societies.
The general aim of the New Household Economics was to provide
economic explanations of various decisions made at the household level.
This forced Becker to think in more detail than Samuelson had about
how to analyze decision-making situations in which household members
differed in their preferences. His solution might seem strange to empiri-
cally oriented anthropologists. Becker argues (1974, 1981) that as long as
a household was headed by an “altruist” (ordinarily assumed to be an adult
male) who “cared sufficiently” to transfer some general resources to other
members, it would be in the self-interest of the altruist’s spouse and chil-
dren to act in ways that maximized the income and consumption of the
household as a whole. Becker does not assume that the altruist exhibits
equal concern for all family members; anything less than complete self-
ishness is sufficient for his theories to work (Pollak 2003:119).
The assumption that a household is headed by a semi-benevolent semi-
dictator allowed Becker and other New Household Economists to treat
the household as a decision-making unit. Although Becker supports his
argument with various mathematical models, some of his assumptions
seem clearly unrealistic. How can it be assumed that households have
“heads” whose decision making is so influential that all other members
will be induced to act in ways that will benefit the household as a whole?
We all know of families, for example, in which members who spend too
much or get fired from jobs for irresponsible behavior depend on par-
ents, spouses, or siblings for their daily expenses. Despite the “altruis-
tic” support these members receive from the “head” or others, their be-
havior cannot be described as maximizing family income. And how can
Becker assume that a family (household) consists of “a brood of egois-
tical but rational ‘kids’” (usually including the wife!) and one altruistic
parent? Does it not make more sense that most households consist of a
number of people whose economic motives are a combination of altru-
ism and self-interest? Finally, Becker’s theories assume without empirical
evidence that members of a household completely pool their resources
(Pollak 2003:131).
The implicit assumption of Becker’s models that households include
an altruistic husband and an egoistic (self-interested wife) is under-
standably offensive to many women (and men) observing actual behav-
ior within households. Becker makes this assumption explicit in articles
such as “Altruism, Egoism, and Genetic Fitness: Economics and Socio-
biology” (1976), in which he claims that there were “natural” grounds for
existing gender-based divisions of labor and authority structures. These
sociobiological ideas were used as additional justifications for the creation
of models treating households as unitary decision-making units. Becker
also presents views unpalatable to many in his book Treatise on the Family
(1981), in which he attributes—perhaps reasonably—higher divorce
rates, increased cohabitation rates, and lower marriage rates to gains in
women’s earning power, leaving some readers with the impression that he
thought families would be stronger if women earned less. Unsurprisingly,
the number of women economists adopting Becker’s approach to house-
hold decision making dropped sharply as the years went by (Grossbard-
Schechtman 2001).
The altruistic model of household decision making was eventually

challenged on both theoretical grounds (for example, in Bergstrom 1989
and Bernheim and Stark 1988) and empirical grounds (as in Folbre 1994
and Hoddinott and Haddad 1994). Economists devised models suggest-
ing that under certain conditions Becker’s assumptions about altruism
do not guarantee optimal results with respect to household income and
consumption. In an influential study aimed at testing ideas about unitary
household decision making, Duncan Thomas showed (1990) that when
women in Brazilian households controlled a high proportion of family
income, child infant mortality rates were lower than when men had
more control of intrahousehold income flows. This showed difficulties
with Becker’s assumption that any degree of altruism by a single mem-
ber would lead to economic decisions that benefited the household as a
whole. Shelly Lundberg, Robert Pollak, and Terence Wales (1997) found
similar difficulties with Becker’s ideas in their analyses of the results of
a change in child benefit programs in the United Kingdom in the 1970s.
These programs paid money to all families with children. The program
had channeled money via the income tax to the primary wage earner in a
household, usually at that time the husband. A new program instead paid
mothers in cash at the post office. Using data from the British Family Ex-
penditure Survey, the researchers were able to show that this method of
payment led to significant changes in the types of goods that households
purchased.
Many economists reached the conclusion that “family decisions . . .
[should be] modeled as negotiations among primarily self-interested indi-
viduals” (Bernheim and Stark 1988:1044). Some therefore created “bar-
gaining” models (including Manser and Brown 1980, McElroy and Horn-
ery 1981) that use concepts from game theory. The general idea is that
the specific economic situations of households, especially the indepen-
dent resources available to particular members, influence the extent and
types of cooperation between men and women. While this idea is familiar
to anthropologists and other social scientists, the language in which co-
operative bargaining models are phrased can be difficult for nonecono-
mists. Here is one of many examples that could be cited:
Nash bargaining provides the leading solution concept in cooperative

bargaining models of marriage. In the Nash bargaining solution, the
utilities received by husband and wife depend on their threat point; the
higher a spouse’s utility at the threat point, the higher the utility that
spouse will receive in the Nash bargaining solution. This dependence is

the critical empirical implication of Nash bargaining models; the couple’s
expenditure pattern depends not only on prices and the couple’s total in-
come, but also on determinants of the threat point. (Pollak 2003:128).
Fortunately, readers do not need to know much about game theory and
threat points to see that this is clearly not a model of a unitary decision-
making household.
While the cooperative bargaining theorists accept many assumptions
of neoclassical economics, feminist economists provide a more radical
critique of models of unitary households. Feminist economists agree with
cooperative bargaining theorists that individual members of households
have separate—sometimes competing—preferences, interests, and re-
sources (Folbre 1986). The two groups of theorists also agree that the
relative power of men and women affects the outcomes of bargaining over
household decisions. They differ, however, in the ways they analyze power.
For the cooperative bargaining theorists, power primarily consists of con-
trol over economic resources. They are ordinarily unconcerned with the
reasons for power differentials between men and women; these are un-
questioned preconditions that provide the starting point for their models.
Feminist economists, in contrast, resemble their counterparts in anthro-
pology by focusing also on the ideological, political, and cultural aspects
of these power differentials (Hart 1992).
In the 1970s and 1980s Marxist-oriented feminist economists (such as
Hartmann 1979) carried out “dual systems” analyses in which many soci-
eties were regarded as consisting of two separate, interacting structures—
patriarchy and capitalism. This interaction resulted in a labor market in
which women’s low pay both perpetuated their dependence on men and
encouraged them to specialize in housework and child care. Moreover,
women’s domestic responsibilities made them less competitive in the
labor market. Nancy Folbre argues that this perspective improved our
understanding of intrahousehold economic negotiations, saying that “the
structure of patriarchy as a system sets the stage for an analysis of bar-
gaining power within a specific household” (1986:250).
Many contemporary feminist economists are less willing than dual sys-
tems theorists to accept the universality of situations in which patriarchy
and capitalism interact to keep women in subordinate positions in house-
holds. Nonetheless, there is general agreement among feminist econo-
mists that the power differentials that affect intrahousehold bargaining
are linked in crucial ways to ideology, culture, and politics. By taking such
a holistic position, feminist economists are truly heterodox, differing fun-
damentally from the dominant practices in their discipline.
Conclusions
For many years anthropologists and economists wrote little about

household-level decision making. The reasons for this neglect differed
in the two disciplines. Anthropologists often failed to distinguish be-
tween “households” and “families,” using these terms interchangeably.
They also downplayed the significance of decision making in general, see-
ing economic choices as largely determined by kinship obligations, cul-
tural rules, and religious beliefs. When they did examine decision making,
their analyses focused on suprahousehold institutions such as clans, lin-
eages, age groups, and political organizations. Although economists re-
garded households as sites of consumption, they paid little attention to
households as productive entities. This could be seen most clearly in their
neglect of unpaid work in households on tasks such as child care, meal
preparation, and growing of subsistence crops. Moreover, the method-
ological individualism of neoclassical economics resulted in models of
consumption in which households were treated as undifferentiated units
where the conflicting preferences of individual members were ignored.
Starting around 1960 both anthropologists and economists began pay-
ing more attention to household-level decision making. Anthropologists
emphasized the problems associated with regarding members of particu-
lar dwellings as self-contained economic entities. They observed that
people moved in and out of residences over the course of a year and that
there was much resource pooling among inhabitants of different dwell-
ings. Nonetheless, between 1960 and 1985 there was general agreement
among anthropologists that family members living together made impor-
tant group decisions regarding many of the resources at their disposal.
The emergence of the New Household Economics in the 1960s, ex-
emplified by the work of Gary Becker, showed the increasing recognition
by neoclassical economists that members of households made significant
decisions about how to allocate the land, labor, and capital at their dis-
posal. Using elaborate (and in my view unrealistic) theoretical justifica-
tions, the models of the New Household Economics treated households
as unitary decision makers. The implicit, and sometimes explicit, assump-
tion was that an adult male member of a household had the ultimate say
on how resources were allocated. Although the New Household Eco-

nomics sometimes considered household decision making in poorer areas
of Africa, Asia, and Latin America, its focus was on industrial regions of
western countries.
Since about 1980 many anthropologists and economists have strongly
criticized the idea that households can be regarded as decision-making
units. They argue persuasively that household decisions are the outcomes
of negotiations among individual members who vary in their goals and in-
fluence. They also point out that the extent to which members of house-
holds pool different resources varies, allowing individuals to exert con-
siderable autonomy in certain kinds of decisions. The most influential
advocates of this position in both disciplines are feminists who emphasize
the social conditions that affect the relative power of men and women in
different types of household decisions. In economics, collective bargain-
ing theorists also reject the idea of the unitary household. These theorists
construct game theory models of the intrahousehold negotiations accom-
panying varied choices.
Although I recognize the cogency of these critiques, I nonetheless
think there is much to be gained through careful analyses of household-
level decision making. It is certainly a mistake to regard households as
undifferentiated groups whose members all share common goals. None-
theless, family members sharing dwellings and pooling many of their re-
sources constitute important socioeconomic units almost everywhere in
the world. There is no reason for anthropologists to return to theories
about the superorganic and for economists to return to methodological
individualism. What is needed, instead, are more detailed ethnographic
descriptions and analyses of how particular important household-level
choices are made in different times and places.
CHAPTER 6
Is There a Tragedy of the Commons?
Four decades ago an unusual article appeared in one of the world’s most
prestigious journals. Most authors of papers in Science present their
findings in language difficult for nonspecialists to understand. Garrett
Hardin’s “The Tragedy of the Commons” (1968), in contrast, is a breezily
written essay about a group of problems said to have no technical solu-
tion. Hardin argues that resource destruction and social chaos often occur
when individuals have unrestricted access to commonly owned property.
His paper inspired a generation of scholars in the biological and social sci-
ences to examine relationships between property rights and resource use.
Although these writers usually reject some of Hardin’s assumptions, many
would agree that his approach provides a useful starting point for dis-
cussions of environmental policies. Perhaps the most influential of these
scholars, the political scientist Elinor Ostrom, shared the 2009 Nobel
Prize in Economics for her research on how people in societies around
the world managed common property.
Hardin’s metaphor of the tragedy of the commons is a situation in
which cattle raisers herd their animals on a pasture where there are no
individual property rights.1 Most herders reason that the benefits of add-
ing another animal to their herd outweigh the costs associated with in-
creased grazing. They do so because the benefits of raising the additional
animal accrue only to the herder, while the costs of overgrazing are shared
by everyone using the pasture. Moreover, those herders who decide not to
raise additional animals because of ecological concerns suffer from over-
grazing as much as their more selfish neighbors. The tragedy of the com-
mons arises when individual herders acting in their self-interest add so
many animals to their flocks that the pasture is ruined.
According to Hardin, many environmental and social problems are
Is There a Tragedy of the Commons? 143
the consequence of individuals overexploiting commonly held resources.

He grudgingly concedes that commonly held resources might be feasible
when population densities are low (1248). But he says the commons must
be abandoned when population increases bring pressures on a resource
base. Hardin also recognizes that technological changes are another im-
portant source of pressure on commonly held resources.
In “The Tragedy of the Commons” Hardin gives several examples
of situations in which commons deteriorate because of unrestricted ac-
cess. These include crowding in national parks, depletion of fish stocks in
oceans, and air and water pollution. His emphasis, however, is on the en-
vironmental and societal damage caused by overpopulation. Even if one
accepts the controversial premise that “overpopulation” is a major cause
of diverse world problems, Hardin’s analogy of family planning decisions
to cattle raising in pastures is not well developed. For his metaphor to
work, one must assume that individuals finding it advantageous to have
large families cause problems for particular commonly held resources.
Hardin never says what conditions make it advantageous for individuals in
certain times and places to have many children. Furthermore, the “com-
mons” allegedly destroyed by overpopulation is never specified. Presum-
ably, Hardin is referring to the overall well-being of the planet.
One of the main points of Hardin’s article is that societies must engage
in what he calls “coercive” action to deal with potential tragedies of the
commons. Hardin contends that moral appeals to individuals to sacrifice
for the public good will inevitably fail. What is needed, instead, are re-
strictions on access to resources. These restrictions can sometimes take
the form of private property. But certain resources such as the air or the
oceans cannot be privatized. In such situations, societies need to devise
incentives, punishments, and laws that prevent individuals, corporations,
and governments from overexploiting common property. Hardin is not
content to limit his discussion to relatively uncontroversial topics such
as attempts to manage access to public parks by raising admission fees or
restricting the number of people who can enter each day. He also omi-
nously, if vaguely, says that “the freedom to breed is intolerable” and that
steps must be taken to prevent this from happening (1245).
The general approach of Hardin’s article is consistent with the rational
choice models of economics. Hardin assumes that a limited set of vari-
ables influences the actions of individuals who make decisions that maxi-
mize their (hazily defined) “utility.” The conclusions that Hardin reaches,
however, are quite different from those of advocates of free markets, in-
cluding many economists, who argue that the results of individual utility
maximization are often good for society and who oppose most types of
government intervention. Because Hardin sees individual utility maximi-
zation in most commons situations as detrimental to the public good, he
is a strong advocate of certain types of government interventions.
Even though Hardin’s conclusions differ from those of many econo-
mists, critiques of his ideas resemble those arguments against rational
choice theory that question the autonomy of individual decision makers
and emphasize the importance of empirical studies examining the ethno-
graphic complexity of local situations. Hardin assumes that in the ab-
sence of government intervention, individuals are the decision makers
who matter in the exploitation of common resources. Social scientists
in diverse disciplines have convincingly shown, however, that in practice
unrestricted access to commons is rare. Almost every society has devel-
oped rules and cultural norms that specify who is allowed to use common
resources and how these resources can be used. Individuals often do not
have the power to destroy commons.
Most critiques of Hardin’s ideas are therefore aimed at his assump-
tions about the units of economic decision making. His many critics say
that Hardin fails to understand that in most places supra-individual so-
cial groups exert considerable control over access to common resources.
Some critics go further and disagree with Hardin on his views about the
supposed futility of what he calls “appeals to conscience” (1244). They
argue that in many places cultural norms can effectively prevent people
from acting in environmentally destructive manners.
Access to Barreales in the Peruvian Amazon
The strengths and weaknesses of Hardin’s approach to common prop-

erty can be seen through an examination of societal regulation of access
to seasonal mud flats (barreales) in the Peruvian Amazon in the mid-1980s.
Ideas drawn from “The Tragedy of the Commons” aid in the understand-
ing of the land tenure conditions that led to conflict in floodplain areas.
But Hardin’s pessimism about the outcome of such conflicts was not war-
ranted. Local communities quickly recognized the need to regulate access
to new types of commonly held land and were able to avert a “tragedy” of
the type envisioned by Hardin.
Visitors to rural areas of the Peruvian Amazon are unlikely to think
that a shortage of land is a problem for the region’s residents. Population
densities are among the lowest in Peru. Despite the extensive publication
given to deforestation and mining, large tracts of jungle are still sustain-
ably used for foraging, fishing, and farming. Outsiders are therefore often
surprised to learn that conflicts over land are common in the Peruvian
Amazon because areas vary in their potential for agriculture and forestry
and their accessibility to markets. Some of the most valuable land in the
region is in fertile floodplains near the city of Iquitos that are used for the
cultivation of rice and other crops. Over the past fifty years, there have
been numerous disputes over rights to lands in the floodplains. These
conflicts have been especially complex because the very best land is in im-
permanent barreales that form and disappear every year.
When I began research in the Iquitos area in the mid-1980s I was im-
mediately intrigued by questions associated with the appearance and dis-
appearance of barreales. How did farmers gain access to new barreales?
What did farmers do when their barreales disappeared? What kinds of
disputes arose concerning access to new barreales? How were these dis-
putes resolved?
The appearance of new barreales posed an annual dilemma for the ribe-
reño inhabitants of floodplain communities that in some ways fit Hardin’s
model of the tragedy of the commons. The mud flats were valuable pieces
of land that many people desired; no individuals had permanent rights
to barreales. If there were unrestricted access to new barreales, serious
problems would arise. These problems, however, would not be the over-
exploitation of a common resource that Hardin emphasized. Although
fishers were depleting the region’s marine resources, ribereños lacked the
technology and capital to cause permanent damage to agricultural land
in floodplains. Instead, the principal difficulties likely to result from un-
restricted access to new barreales would be confusion, chaos, and conflict
in a free-for-all rush to grab the best pieces of land. Hardin’s observation
that restrictions on access to a commons are necessary for the public good
when there is sufficient competition for resources clearly applied to land
rights in barreales.
When I was conducting research in the Peruvian Amazon, I was not
explicitly thinking about barreal allocation in terms of the tragedy of the
commons. Nonetheless, the questions that Hardin and others had raised
about communal property preoccupied me throughout my fieldwork. I
examined the systems that the Peruvian state and local communities had
devised to regulate access to new barreales, and I asked ribereños how sat-
isfied they were with these rules. I looked at the extent to which local and
state systems of regulating access alleviated commons-related problems.
Finally, I was interested in a commons-related political economic ques-
tion that was not covered by Hardin’s model—the extent to which access
to good floodplain land was affected by the political power and social
position of the local elites who owned commercial estates along the river.
During the 1980s local branches of the Peruvian Ministry of Agricul-
ture had responsibility for assigning land rights in floodplain communi-
ties near Iquitos. There were two types of land use permits, titles and cer-
tificates. Titles gave the possessor permanent rights to land. The ministry
ordinarily gave individual titles only to owners of commercial estates and
group titles only to state-recognized “indigenous” communities. (Ribe-
reño villages were only rarely officially recognized as “indigenous.”) Dis-
putes frequently arose when the ministry gave estate owners rights to
land used by residents of a ribereño community. Certificates gave ribe-
reños temporary use rights to land. In barreales, certificates for up to 10
hectares were given for one year, beginning in September and ending in
August. Holders of a certificate maintained use rights only if their land
did not change from one year to the next. As I had speculated when first
thinking about the situation, disputes often occurred within and between
communities concerning rights to newly formed barreales. Individuals
and communities that had lost barreales often thought they should be
given priority when allocations of new barreales were made. Such claims,
however, were sometimes rejected.
The Ministry of Agriculture rarely interfered in villages’ internal allo-
cation decisions. During the mid-1980s many communities allocated ba-
rreales in two separate meetings. The first meeting took place before the
rivers fell and barreales appeared. A preliminary division of barreales was
made for the specific purpose of arranging for certificates to be given to
farmers applying for rice credit from the Agrarian Bank. Once the rivers
fell and villagers knew where the barreales were, a second meeting was
held to make a binding division.
The allocation of barreales in the area near the community of Santa
Sofía in November 1985 shows how local ecology and politics affected de-
cision making about rights to land in floodplains. When the Amazon River
receded in June, new barreales had formed on an island near Santa Sofía.
Although parts of the land were claimed by Santa Sofía and the nearby
communities of Manatí and Capironal, the land had not been legally di-
vided among the villages. Furthermore, customary use patterns did not
provide clear guidelines for the distribution of the new barreales. The
island had been farmed in 1985 by inhabitants of the three villages and
the employees of a commercial estate near Manatí. Residents of the three
ribereño communities all wanted the commercial estate to be prohibited
from using the new barreales but worried that this might not happen be-
cause of social ties between the estate owner and government officials.
Farmers in Santa Sofía hoped to gain access to about twenty hectares
of new land. They had been using about ten hectares of mud bar in a dif-
ferent location. No one farmed more than two hectares at this place, and
many residents of Santa Sofía lacked access to any barreales. The older
barreal, which was on higher land than the island, was unlikely to dis-
appear in the immediate future. However, this land was regarded as less
agriculturally desirable than the new barreales.
After consulting with the political leaders of Santa Sofía, Capironal,
and Manatí, the official of the Ministry of Agriculture assigned to allocate
land on the island devised a plan satisfactory to all three communities.
Village leaders were especially pleased that the estate owner was not given
access to the new barreales. Santa Sofía’s farmers received the twenty
hectares on the island that they had requested, and the thirty hectares of
barreales that the community now had were sufficient for its agricultural
needs.
I attended the meeting in which Santa Sofía allocated its new land. The
process was not altogether straightforward. Residents disagreed about
whether farmers who were still using land in the old barreal should be
given rights in the new barreal. These decisions were eventually made
on a case-by-case basis. Another problem involved the allocation of plots
among households. Someone suggested that the new barreal be divided
into twenty one-hectare plots. However, more than twenty requests for
land were made because in some households several members asked for
plots.2 The problem was resolved by placing limits on the number of plots
given out per household.
The complex ways in which new barreales were allocated in the Peru-
vian Amazon in the mid-1980s illustrate some of the limitations of sim-
plistic approaches to common property. Examinations of situations that
may exemplify a “tragedy of the commons” require clear descriptions of
the alleged commons and potential users. Such analyses must also say
something about the possible costs and benefits of different types of at-
tempts to restrict access to common property to both the public good and
diverse potential users.
In the Peruvian case described here, the commons can be specified
fairly easily as the new barreales that appear in the vicinity of particu-
lar communities. It is harder to determine the potential users, who may
include residents of several villages and the owners of local commercial
estates. Stating the gains and losses for different individuals under alterna-
tive methods of allocating new barreales is easy to do in a general way but

almost impossible to quantify. Furthermore, there is no value-free way of
comparing the costs and benefits to the “public good” of including or ex-
cluding the owners of commercial estates from access to new barreales.
The version of the tragedy of the commons proposed by Hardin as-
sumes that there are no restrictions to access to communal resources. In
the Peruvian Amazon, access to good floodplain land has long been regu-
lated by the state, commercial estates, and local communities. Hardin
would approve of and perhaps expect the state’s adjudication of disputes
over access to new barreales. His approach, however, does not consider
the informal procedures that communities develop that limit access to
common resources. In the Iquitos area in the mid-1980s, these took the
form of community meetings in which decisions were made about how to
allocate new barreales. These decisions were based on shared beliefs that
all households in a community had the right to some access to barreales
and that mud-flat land should be distributed relatively equally among
potential users. As Hardin surely would have observed, these beliefs could
be put into practice because the demand for barreales was limited by local
agricultural methods and low population densities.
Hardin assumed that tragedies of the commons arise because of tech-
nological changes and population increases that increase the demand for
common property. His approach largely ignores the ways historical cir-
cumstances and local political economies determine who are the poten-
tial users of communal resources. The resolution of the dispute between
the communities near Santa Sofía and the local commercial estate over
new barreales in 1985, however, can only be understood in the context of
a history of land conflicts. Riverine communities near Iquitos had been
attempting for decades to wrest property rights over floodplains from
owners of commercial estates that had come into existence during and
after a rubber boom that lasted from about 1870 to 1912. A left-leaning
military government in Peru had created a political environment during
the 1970s in which many communities in jungle regions were able to gain
land tenure rights. Although the military government ended in 1980, dur-
ing the period of my research Amazonian communities were continuing
to win some of their struggles for land rights. National and local politics
therefore created a situation in which the Ministry of Agriculture was
able to give control of new barreales to Santa Sofía and neighboring com-
munities rather than to the owner of the nearby commercial estate. The
local methods of allocating barreal land were not long-standing customs.
Instead, they were newly devised systems that developed after the owners
of commercial estates lost control of floodplains.
Reactions to Hardin
The principal goal of Hardin’s 1968 Science article was to use the tragedy
of the commons as metaphor for the causes and consequences of popu-
lation increases. Hardin’s ideas about overpopulation, which are not all
that different from those of Malthus, have had little influence among de-
mographers and other social scientists. His model of the tragedy of the
commons, however, was adopted, elaborated, and modified by countless
public officials and writers interested in relationships between property
rights and environmental conservation. Many policy analysts and schol-
ars concluded that common ownership of property was a major cause
of the degradation of natural resources such as fisheries, forests, lakes,
and oceans. They contended that the users of commons were caught in
a dilemma from which they could not extract themselves without the
imposition of rules and regulations by external authorities (Ostrom
1999:493–494).
Most economic and ecological anthropologists were uneasy with this
enthusiasm for Hardin’s ideas. These empirically oriented researchers
emphasized the difference between “open access” and “common prop-
erty.” Hardin’s model assumed that all members of a community had
open access to the use of commonly held resources. Research by anthro-
pologists and other social scientists, however, showed that in many places
where there was common property, societies had devised rules and regu-
lations specifying how communal resources could be used (Acheson 1989,
McCay and Acheson 1987). These rules and regulations in many cases
alleviated or even eliminated potential resource degradation.
Anthropologists for the most part focused on providing ethnographic
descriptions of the diverse social institutions that have regulated resource
use in commonly held property at different times and places. Historians
also have presented numerous relevant examples. Although scholars in
other disciplines such as political science and resource economics have
appreciated the empirical evidence reported by anthropologists and histo-
rians, they consider it important to go beyond analyses of particular cases.
Social scientists such as Elinor Ostrom (1990, 1999) and Arun Agrawal
(2001) have wanted to come up with generalizations about which par-
ticular conditions and institutions favor the environmentally sustainable

use of public property. They emphasize theory building and multicase
comparisons; their evidence includes laboratory experiments (Ostrom
1999:501–508) as well as fieldwork-based studies.
Craig Johnson has argued that there is a fundamental tension within
scholarship about the commons between “a social science which seeks
to build theory on the basis of scientific empiricism and an ethnogra-
phy which rejects the universalism that underlies the scientific approach”
(2004:428). While there certainly are disciplinary differences in research
styles and goals, Johnson misunderstands the work of the anthropologists
writing about common-property situations. Most of the anthropologists
known for the expertise on the commons—in particular Bonnie McCay
and James Acheson—fall squarely on the “science” side of the science/
humanities divide in their field. Furthermore, these anthropologists have
often worked closely with generalizers from other disciplines, notably
Elinor Ostrom.
Nonetheless, Johnson makes a useful suggestion about how to look at
research on the commons:
Two bodies of thoughts compete for a voice in this literature. One, re-
sponding to Hardin’s tragedy of the commons, is primarily concerned
with the problems of achieving collective action to conserve natural re-
sources which are both depleted and unregulated. A second, influenced
by notions of moral economy . . . and entitlement . . . deals with the
problem of creating and sustaining resource access for poor and vul-
nerable groups in society . . . Whereas “collective action scholars” ana-
lyze the rules and sanctions that encourage individuals to conserve the
commons, “entitlement scholars” emphasize the historical struggles that
determine resource access and entitlement, and the ways in which formal
and informal rules create and reinforce unequal access to the commons.
(408–409)
This distinction draws attention to an aspect of commons scholarship

that is only occasionally emphasized. Most writers about the commons are
primarily concerned with the effects of property rights and social institu-
tions on the conservation of natural resources. These writers (Johnson’s
“collective action scholars”) are also sometimes interested in the extent
to which members of a community have equitable access to common re-
sources. They rarely, however, consider in detail the effects of property
rights and social institutions on those denied access to common resources.
Such “unentitled” potential resource users are implicitly or explicitly de-

nied community membership.
Despite Hardin’s emphases on population growth and state interven-
tion, most analyses of commons situations have focused on how local in-
stitutions, rules, and regulations affect resource use. Arun Agrawal per-
suasively argues that this concentration on the small scale has prevented
the emergence of a better understanding of how population, market de-
mand, technology, and state policies interact with local institutional ar-
rangements and resource systems. He points out that what is local is often
created by connections with the external and nonlocal environment.
Agrawal says an “almost exclusive focus upon the local” has made “[much]
work on common property vulnerable to the same criticisms that apply to
the work of anthropologists who see their field sites as miniature worlds
in themselves, changing only in response to political and economic influ-
ences from the outside” (2001:1657).
There is disagreement about the extent to which post-Hardin analysts
of commons situations accept rational choice models. Craig Johnson as-
serts that a central assumption of collective action theorists is that “social
outcomes can be explained in terms of calculations that individuals make
about the perceived costs and benefits of future actions (methodological
individualism)” (2004:411). Yet Elinor Ostrom, the best-known collec-
tive action scholar, has explicitly argued against Hardin’s idea that re-
source users are “norm-free maximizers of immediate gains, who will not
cooperate to overcome the perverse incentives of dilemma situations in
order to increase their own and others’ long-term benefits unless coerced
by external authorities” (1999:496). She adopts instead a view of human
decision making consistent with the findings of both experiments in cog-
nitive psychology and cultural evolutionary theory:
Given that predictions based on the model of a norm-free, myopic, and

maximizing individual are not supported, I . . . [argue for] a closely re-
lated but alternative conception of human behavior—applicable to re-
source users and government officials alike. Humans are viewed as fal-
lible, boundedly rational, and norm-using. In complex settings, no one
is able to do a complete analysis before actions are taken, but individuals
learn from mistakes and are able to craft tools—including rules—to im-
prove the structure of the repetitive situations they face. (Ibid.)
These tools presumably include the creation of social institutions regu-

lating access to common property.
Anthropological Approaches to Common Property
Some time ago James Acheson was asked to write a chapter on “manage-
ment of common-property resources” for a textbook in economic anthro-
pology (Plattner 1989). Acheson was an obvious choice for this task. He
had published widely on commons situations (Acheson 1975, McCay and
Acheson 1987, for example) and was well known for his lucid, intriguing
accounts of ways in which Maine lobstermen controlled access to fishing
areas. The chapter by Acheson (1989) summarizes the prevailing anthro-
pological take on Hardin’s ideas. Twenty years later, this summary re-
mains the clearest and most comprehensive discussion of anthropological
approaches to common property.
Near the beginning of his chapter Acheson presents four assumptions
that he says are shared by Hardin and the many economists using his theo-
retical framework:
1. The users of common-property resources are individualistic profit

maximizers driven by economic goals to overexploit the resources on
which their livelihood depends despite the best interests of society as
a whole.
2. The users of these resources have the technical capacity to exceed the
biological maximum rate of renewal of the resource . . .
3. Those using common-property resources and the local communities
they live in cannot or will not erect effective institutions to protect the
resources they live on.
4. The exploitation of collectively owned resources can be halted only by
either instituting private property or the government taking action.
(357–358)
Acheson then asserts (358) that the primary contribution of anthropolo-

gists to theories about common-property resources has been to show that
these assumptions either hold true only under certain circumstances or
are just plain wrong.
Most of the rest of the chapter consists of details about the empirical
studies that led Acheson to reach this conclusion. His principal point is
that there is not a strong relationship between types of property rights
and the likelihood of resource degradation. Acheson does not confine his
argument to noting the many ways that different societies alleviate en-
vironmental destruction by limiting access to commonly held property.
He also observes (364) that there is much disagreement and little hard
evidence about the effectiveness of private property rights in conserv-
ing resources. Acheson points out that under certain conditions it makes
sense for owners of resources to use them up rapidly, disregarding the
future effects on conservation. He gives two examples from his state of
Maine. Potato farmers rarely use contour plowing or other strategies to
control soil erosion; the forestry practices of big paper companies are in-
fluenced more by their need to make a profit in the short term than by
the long-term conservation of the forests they use. Because other cases of
destruction of privately held resources are frequent and glaringly obvious
in industrial societies, it is surprising that they are only occasionally men-
tioned by Hardin and other proponents of common-property theory. It
is as if they had never thought seriously about the activities of farmers, oil
companies, and owners of coal mines.
Anticipating Agrawal (2001) by more than a decade, Acheson notes
(1989:372) that many anthropologists and other social scientists argue
that explaining the overexploitation of natural resources solely in terms of
property rights is an oversimplification that ignores other aspect of socio-
economic systems. He briefly discusses the effects of population growth
(as would Hardin), industrialization, and the expansion of capitalist sys-
tems and markets. Acheson concludes the chapter by saying that the work
of anthropologists shows that Hardin’s theory of common-property re-
sources needs considerable modification:
In virtually all societies, there are controls on access to resources and

various kinds of rules and arrangements to limit exploitative activities.
Individuals are not allowed to seek their short-term goals at the expense
of society. In many industrialized or overpopulated societies, tragedies
of the commons do exist, but this is not due to the fact that societies
generally abandon their resources to anyone who wants to exploit them.
(375–376)
Although Acheson agrees with Hardin that resources can be conserved by

privatization and government action, he says that a wide variety of local-
level institutions can also be effective (377). None of these solutions, how-
ever, is effective in every case.
Maine Lobsters and the Tragedy of the Commons
Ocean fishing would appear to be a paradigmatic example of the tragedy

of the commons. Because there are no individual rights to pieces of ocean,
fishers have no incentive to limit their scale of operation. What one fisher
fails to catch often just goes to another fisher. When technology becomes
sufficiently efficient that fish stocks can be depleted, a tragedy of the com-
mons may develop.
Despite Acheson’s later critiques of common-property theory, he is
perhaps best known for earlier research on fishing territories in Maine that
supported some of Hardin’s ideas. Acheson conducted detailed studies of
the informal arrangements that Maine lobstermen (women rarely fished
for lobster) had developed to limit access to particular parts of the ocean.
He showed that more restrictive arrangements better preserved the stock
of lobsters.
In Maine, only those lobstermen recognized as local community
members are permitted to fish in parts of the ocean near where they live.
Interlopers are initially warned to leave the area, often by having their
traps opened. If an outsider persists in fishing, his traps are pulled in and
pushed into deep water.3 Because trap cutting is illegal, most enforcement
of these social norms is done quietly. State officials are likely to hear only
rumors; even the victims usually keep quiet.
Acheson made a distinction between “nucleated” and “perimeter-
defended” areas of ocean. Nucleated areas, typically found near coastal
communities, were not clearly delineated. Although the areas near towns
were sharply defended, the “ownership” status of parts of ocean farther
away from population centers was hazier. Often there were overlap-
ping zones exploited by lobstermen from two communities. Perimeter-
defended areas, in contrast, had well- defined boundaries. All lobster-
fishing territories were perimeter-defended before 1920. Along the coast
of Maine, later technological changes allowed lobstermen to exploit larger
areas than previously, leading them to be less willing and able to defend
every part of the ocean they used. The result has been a transition from
perimeter-defended to nucleated zones. Nowadays, almost all perimeter-
defended zones are near islands.
Because of the more rigorous enforcement of boundaries in perimeter-
defended zones, Acheson found that they were fished less intensively than
nucleated zones. He also found that lobstermen fishing in perimeter-
defended areas sometimes voluntarily agreed to take measures to con-
serve resources. These included limiting the number of traps they used
and imposing a closed season when they did not fish at all. Such voluntary
conservation measures were much less common in nucleated areas that
included overlapping territories exploited by lobstermen from more than
one community.
Acheson’s research showed that the reduced fishing effort in perimeter-
defended areas had both biological and economic benefits. In perimeter-
defended zones, the stock density and average lobster size were greater
than in nucleated areas. Men in perimeter-defended areas caught more
lobsters per hour. As a result of better stock and easier fishing, lobstermen
in perimeter-defended areas did better economically than those in nucle-
ated zones.
In his later publications, Acheson emphasizes how the informal sanc-
tions against boundary violations contradicted Hardin’s theory. But when
Acheson first wrote about Maine lobstermen (in 1975), he focused on
aspects of his findings that were congruent with Hardin’s ideas. Clearly
technological improvements had led to the potential for a tragedy of the
commons in lobster-fishing areas. Those communities that took strong
action to restrict access to these areas did better, as Hardin would have
expected, than those that took weaker measures.
In his discussions of territorial boundaries in Maine lobster-fishing
areas, Acheson downplays two aspects of the situation that are only loosely
related to the points that he wants to make. As entitlement scholars would
point out, Acheson says little about the ways in which the arrangements
he describes harm those who might want to become lobstermen but are
not members of any fishing community. Unless such people marry into
a community or settle in for a number of years, they are effectively shut
out of the lobster economy. More importantly, the informal sanctions
against boundary violations do not seem to be preventing the depletion
of lobster. As Acheson observes, the technological developments that led
to overfishing of lobster also resulted in a transition in most places from
perimeter-defended to nucleated zones. Because lobster stocks are declin-
ing in nucleated areas, overfishing seems inevitable unless there is more
extensive state intervention of the type recommended by Hardin.
Comparative Studies
Anthropologists were not the only social scientists carrying out detailed
studies of the allocations of commons in the 1970s and 1980s. A bibli-
ography compiled two decades ago (Martin 1989) includes almost 5,000
case studies of the use of common property. The disciplines represented

included rural sociology, anthropology, history, economics, political sci-
ence, forestry, and human ecology. Despite this vast amount of informa-
tion about the use of common property, there had not yet been serious
attempts at synthesis (Ostrom 1990:xv). Researchers in anthropology and
other disciplines had convincingly demonstrated that Hardin’s model was
based on assumptions that did not apply in many places and times. They
had, however, rarely attempted to make generalizations about how the use
of common resources varied in different circumstances. In order for such
generalizations to be made, it would be necessary for someone to make
systematic comparisons of the case studies that had already been carried
out. Elinor Ostrom’s book Governing the Commons: The Evolution of Insti-
tutions for Collective Action (1990) is a thorough, cogent attempt to make
such comparisons. Ostrom begins by observing that the tragedy of the
commons can best be understood as an example of a recurring issue in
social science, the conflict between individual self-interest and the public
good (2–7). She discusses three closely related models of such conflicts,
noting that they raise free-rider problems of the type discussed by schol-
ars interested in the evolution of altruism:4
[These models] have defined the accepted way of viewing many prob-
lems that individuals face when attempting to achieve collective benefits.
At the heart of each of these problems is the free-rider problem. When-
ever one person cannot be excluded from the benefits that others pro-
vide, each person is motivated not to contribute to the joint effort, but to
free-ride on the efforts of others. If all participants choose to free-ride,
the collective benefit will not be produced. The temptation to free-ride,
however, may dominate the decision process, and this all will end up
where no one wanted to be. (6)
Ostrom says that such models are interesting and powerful because
they capture important aspects of many different problems in diverse set-
tings around the world. But she says that these models are often wrong
empirically and lead to bad public policy:
Instead of presuming that the individuals sharing a commons are inevi-

tably caught in a trap from which they cannot escape, I argue that the
capacity of individuals to extricate themselves from various types of
dilemma situations varies from situation to situation. The cases to be dis-
cussed in this book illustrate both successful and unsuccessful efforts to
escape tragic outcomes. Instead of basing policy on the presumption that

the individuals involved are helpless, I wish to learn more from the ex-
periences of individuals in field settings. Why have some efforts to solve
commons problems failed, while others have succeeded? What can we
learn from experience that will help stimulate the development and use
of a better theory of collective action—one that will identify the key
variables that can enhance or detract from the capabilities of individuals
to solve problems? (14)
Ostrom is not content to simply say, as many anthropologists have, that

the world is more complex than is suggested by models such as the tragedy
of the commons. Such observations, she asserts, are not in themselves
useful (183). But Ostrom is able in her book to make only some difficult-
to-test, loosely stated generalizations about when commons management
is likely to be successful. She restricts her conclusions to CPRs (common-
property resources) in remote locations under political regimes that are
indifferent as to how these resources are managed. By so doing, Ostrom
ignores most of the cases that inspired Hardin and others to develop their
theories. She concludes that under the conditions she describes the likeli-
hood of resource users adopting changes in management rules to improve
joint welfare will be positively related to the follow characteristics (listed
in order of importance):
1. Resource users agree that they will be harmed if they do not adopt
changes.
2. Most users will be affected in similar ways by the proposed rule
changes.
3. Most users are concerned about the long-term consequences of their
actions.
4. Users face relatively low information, transformation, and enforce-
ment costs.
5. Users share generalized norms of reciprocity and trust.
6. The user group is relatively small and stable. (211)
In later publications Ostrom and others (for example, Dietz, Ostrom,

and Stern 2003; Ostrom 1999) have identified numerous other variables
that they regard as relevant to the use of commons. According to Agrawal
(2001:1651), as many as thirty-five factors have been suggested as being
critical to the organization, adaptability, and sustainability of common
property. Nonetheless, most scholars agree with Agrawal that there is no
widely accepted theory about what leads to the effective management of

common-property resources (ibid.). Furthermore, few researchers have
attempted tests of the relative importance of factors said to be crucial to
the sustainability, efficiency, and equity of commons allocations at differ-
ent places and times.
There have been two quite different reactions to the difficulties that so-
cial scientists have encountered in their attempts to make generalizations
about commons management. Some writers including Agrawal contend
that attempts to make generalizations have not been sufficiently systematic
in their efforts to identify relevant variables and describe their relation-
ships. Agrawal points out (2001:1653) four general types of variables that
affect the success or failure of commons management—characteristics
of resources, characteristics of groups depending on resources (empha-
sized by Ostrom in Governing the Commons), characteristics of institu-
tions managing commons, and characteristics of relationships between
resource users and external forces and authorities such as markets, states,
and technology. He urges a two-pronged approach to improve our under-
standing of commons management (1662). First, there need to be theo-
retically motivated comparative case analyses to identify the most im-
portant causal mechanisms and to narrow the range of relevant variables
and their interactions. Second, there need to be more large-scale statisti-
cal studies to specify the strength of causal relations. Agrawal obviously
thinks that Ostrom and her colleagues have been insufficiently rigorous
in their search for generalities and have overemphasized the complexity
of particular cases. Whatever the merits of Agrawal’s argument, we are no
closer today to a general theory of commons management than we were
when he wrote his article.
Many anthropologists and historians agree with the political scien-
tist Craig Johnson (2004) that searches for generalizations about com-
mons management are likely to have only limited success. Johnson favors
the approach of entitlement scholars who understand the degradation of
commons resources primarily in terms of historical processes associated
with the privatization and commercialization of local resource systems.
He contrasts this approach with what he calls the “tragedy school” (420)
that explains commons dilemmas and their resolution in terms of indi-
vidually calculated responses to structural incentives. This strikes me as at
best an oversimplification and at worst a misrepresentation of the ideas of
Ostrom and other collective action scholars. Nevertheless, Johnson’s em-
phasis on the intersection of large-scale historical processes and the par-
ticularities of local circumstances is shared by the many scholars whose

analyses of commons focus on political economy and political ecology.
The Tragedy of the Commons—Model, Theory, or Metaphor?
Some years ago Ottar Brox wrote a provocative, idiosyncratic article

(1990) in which he argues that explanatory traditions in different disci-
plines lead to competing interpretations of theories about common prop-
erty. Brox is a Norwegian social scientist whose interest in the commons
focuses on the causes of overfishing in oceans. His examples are almost
entirely restricted to the allocation and use of marine resources. Further-
more, he ignores much relevant work on the commons, notably the re-
search of Ostrom and her colleagues.5 Despite these limitations, Brox’s
essay addresses some fundamental issues associated with the use of the
concept of the tragedy of the commons.
Although Brox recognizes that researchers from many disciplines have
worked on commons problems, he frames his article primarily in terms of
a contrast between anthropologists and economists. According to Brox,
anthropologists conducting studies of fishing regard the tragedy of the
commons as a statement about empirical conditions in the world. He
notes that when anthropologists such as Acheson present cases that do
not fit Hardin’s theory, they think they are falsifying a hypothesis. Econo-
mists, however, regard the tragedy of the commons as a model of human
behavior that shows what the consequences are if certain conditions hold.
For economists, the empirical studies cited by Acheson and others do not
falsify Hardin’s theory; instead they are just cases in which the assump-
tions of the model are not satisfied. Brox attributes this disagreement be-
tween anthropologists and economists about the usefulness of the con-
cept of the tragedy of the commons to different scientific traditions in
their disciplines. He says that “if natural history is the grandfather of
modern social anthropology, economics is the offspring of mathematics
and a priori logic” (1990:229).
Brox argues that commons models have had analytic utility because
they lead researchers to pay attention to aspects of resource use that they
have previously neglected to consider.
What makes the CPT [common-property theory] so useful in the ana-

lyses of specific cases is that it forces us to keep aggregate consequences
of individual adaptations and careers constantly in mind. It makes us see,

very clearly, the possible tragic end result of natural resources . . . being
available free of charge to the exploiter. (234)
Another way of making Brox’s point would be to say that the tragedy of
the commons is a metaphor for a diversity of situations. This metaphor
has inspired researchers to carefully examine similarities and differences
in the use of common resources in diverse times and places. In some cir-
cumstances, Hardin’s analogy to a pasture works well; in most cases it is
incomplete or misleading. Whether or not the metaphor works in a par-
ticular place, taking it seriously forces researchers to examine thought-
fully the environmental effects of the ways in which commons are allo-
cated and used.
Brox is clearly right that Hardin’s ideas have inspired much useful re-
search. However, he downplays the damage caused by the popularity of
the idea of the tragedy of the commons. Economists are much more in-
fluential than anthropologists in the formulation of public policy. Policy
makers influenced by the idea of the tragedy of the commons are likely
to underestimate the extent to which local institutions can alleviate over-
exploitation of forests, oceans, and lakes. Furthermore, a focus on indi-
vidual self-interest as a major cause of the tragedy of the commons can
lead to neglect of wider economic, political, and technological changes
that result in environmental damage. The consequences in some places
have been public policies that emphasize either privatization of resources
or the development of structural incentives intended to change the costs
and benefits to individuals of environmentally destructive actions. While
such policies can be beneficial, they largely ignore inequities in access to
resources. They also sometimes result in an unjustified trust in the effec-
tiveness of privatization in alleviating environmental problems.
Politics, Economics, and the Commons
The diverse reactions to Ostrom’s 2009 Nobel Prize illustrate the unusual
position of commons research along the political spectrum. The award to
Ostrom was applauded by both conservatives and liberals. Peter Boettke,
a free-market enthusiast who admires Gary Becker and Milton Fried-
man, has said that Ostrom’s research shows the “wisdom of decentral-
ized government” and demonstrates “the extraordinary capacity of indi-
viduals to solve problems without resorting to top down plans” (2009).

Similar comments have been made by members of two conservative think
tanks, Michael Spence of the Hoover Institution and Arnold Kling of the
Cato Institute (in Schneiderman 2009). Randall Amster, a self-described
“peace educator, author, and activist,” has interpreted Ostrom’s research
quite differently. Amster blogs on the Huffington Post that “Ostrom’s body
of work is inherently radical, demonstrably anti-corporate, and implicitly
socialist” (2009). He goes on to say that “in choosing to honor her, the
Nobel selection committee has provided an intriguing buttress against the
self-referential ‘only money matters’ work of people like Milton Fried-
man, and has extended its influences into a new generation of economics
premised on sustainability and community-based management.” Such
remarks may tell us as much about the commentators as they do about
Ostrom’s work. The embracing of Ostrom’s ideas by writers of such di-
vergent political perspectives suggests, however, that much commons re-
search cannot be easily fit into conservative (free market) or liberal (pub-
lic good, collectivist) economic perspectives.
Commons research also occupies an ambivalent position within the
field of economics. Many economists seemed bemused by Ostrom’s award.
Both Paul Krugman, New York Times columnist and 2008 Nobel Laureate,
and Steven Levitt, co-author of Freakonomics (Levitt and Dubner 2005)
and Superfreakonomics (Levitt and Dubner 2009), confessed that they had
never heard of Ostrom. Krugman was one of numerous commentators
who saw the prize as an award for the subfield of institutional economics:
Neoclassical economics basically assumes that the units of economic de-

cision making are a given, and focuses on how they interact in markets.
It’s not much good at explaining the creation of these units—at explain-
ing, in particular, why some activities are carried out by large corpora-
tions, while others aren’t . . . a quick scan [of Ostrom’s work] shows why
she shared the prize; if the goal is to understand the creation of eco-
nomic institutions, it’s crucial to be aware that there is more variety in
institutions, a wider range of strategies that work, than simply the binary
divide between individuals and firms. (2009)
This perspective seems narrower than that of most anthropologists,

political scientists, and historians who work on commons questions.
Levitt’s comments are perhaps more interesting. He mostly ignores the
substance of Ostrom’s work, saying instead that
the economics profession is going to hate the prize going to Ostrom even
more than Republicans hated the Peace Prize going to Obama. Econo-
mists want this to be an economists’ prize (after all, economists are self-
interested). This award demonstrates, in a way that no previous prize has,
that the prize is moving toward a Nobel in Social Science, not a Nobel in
Economics. (2009)
This comment must be considered in the context of previous Nobels in

economics given to mathematicians (Robert Aumann, Leonid Kanto-
rovich, John Nash), psychologists (Daniel Kahneman), and lawyers
(Fredrich Hayek, Leonid Hurwicz). Clearly for Levitt and many other
economists, Ostrom’s research seemed further from the mainstream than
that of these other scholars.
There are several reasons Ostrom’s work is unfamiliar and a bit alien
to many mainstream economists. Ostrom makes relatively little use of
formal models and quantitative methods. Even though Ostrom has con-
ducted numerous economic experiments, she is best known for her de-
tailed, descriptive accounts of particular commons arrangements. While
many mainstream economists carry out empirical studies, their research
is ordinarily more quantitative, more model-driven, and much less ethno-
graphic than the work of Ostrom. Furthermore, the informal social ar-
rangements and institutions studied by Ostrom, often in nonwestern set-
tings, differ greatly from the firms, markets, consumers, investors, and
entrepreneurs in western countries that comprise most of the subject
matter of contemporary economics.
Ostrom’s Nobel Prize was celebrated by many members of the list-
serv of the Society for Economic Anthropology (SEA). The reaction of
Carolyn Lesorogol of Washington University, St. Louis, is typical:
I think economic anthropologists should be very pleased with this award

and its implicit challenge to standard economic approaches . . . Lin
Ostrom’s work on common property, cooperation, and trust is a funda-
mental contribution to studies of institutions and is highly relevant for
anthropologists similarly interested in how ordinary people organize
themselves to manage their shared resources. (2009)
Other SEA members also seemed particularly pleased by what they

saw (perhaps mistakenly) as a rebuke to the model building of many
economists.
Conclusions
Elinor Ostrom is only one of the many scholars who have carried on re-
search of commons issues in the four decades since Hardin’s article ap-
peared in Science. Her work, however, exemplifies much commons re-
search in its attention to historical and ethnographic details. Hardin’s
original formulation of the tragedy of the commons could have resulted
in the development of complex mathematical models of the sort found
in economists’ analyses of risk, rational choice, and household decision
making. His ideas might also have led to extensive testing of hypothe-
ses in laboratory experiments such as those common in studies of sub-
jective probabilities and cooperation. Although some researchers ex-
amining commons questions have used formal models and experiments,
most have emphasized the findings of empirical studies in field settings.
Much of this research has been carried out by noneconomists, including
many anthropologists. In most of the earlier chapters of this book, the
dominant, model-driven approaches by economists to various issues re-
lated to decision making are contrasted with less influential, heterodox
ethnographic approaches. The situation is reversed in commons research,
which is dominated by ethnographic studies.
Conclusion
Social scientists examining choice vary in their positions along what

might be roughly labeled a science-humanities continuum. Economists
and experimental psychologists are at the science end of this continuum.
Their attempts to construct theories about choice involve models that
specify how a few key variables are related to one another. Although
economists usually stress the testability of the models they create, in
practice their work often concentrates on exploring the mathematical
implications of different assumptions about relationships among vari-
ables. Experimental psychologists are less concerned about the mathe-
matical complexities of their models; their focus is on learning how
people make choices in controlled laboratory conditions. Both econo-
mists and experimental psychologists know that their models ignore
many factors that affect both the possible choices available to decision
makers and the ways in which particular options are selected. Further-
more, the decision-making experiments of psychologists and behavioral
economists take place in laboratory settings that usually differ in signifi-
cant ways from real-world conditions. Nonetheless, these social scien-
tists argue that the careful construction and testing of theories requires
models and experiments that are intentional simplifications of a com-
plex world.
Many anthropologists and historians are at the humanities end of a
science-humanities continuum; some would reject the term “social sci-
ence” as a label for the kind of research they carry out. When these schol-
ars examine decisions, their focus is often on the historical changes, cul-
tural norms, and socioeconomic institutions that constrain the choices
possible for different groups of people at particular places and times. Most
geographers, political scientists, and sociologists are somewhere between
Conclusion 165
economists and historians on a science-humanities continuum. Scholars

analyzing choice in these fields usually attempt to be “scientific” but reject
the radically simplified, nondescriptive approaches of many economists
and experimental psychologists.
These broad characterizations of entire fields of study ignore signifi-
cant intradisciplinary variation. Feminist, Marxist, and other heterodox
economists often eschew mathematical models and focus instead on his-
tory, social institutions, and culture. Freudian psychologists neither con-
struct testable hypotheses nor run experiments in laboratories. Formalist
economic anthropologists create elaborate models of choice; anthropolo-
gists influenced by evolutionary psychology run experimental games in
nonwestern settings in which they examine the effects of a few carefully
defined variables on decision making.
Although I have examined here ideas about decision making from di-
verse natural and social sciences, I have concentrated on contrasts be-
tween the approaches of economists and anthropologists. The usual ap-
proaches to decision making in the two fields are strikingly different.
Economists often scorn the ways that anthropologists analyze choice as
meandering, unscientific, anecdotal, and untestable. Anthropologists can
be equally contemptuous of economists, thinking that their models ignore
history, culture, ethnography, and the real world.
To summarize the differences between the two fields in their ap-
proaches to decision making, it is useful to list some of the continuums
along which they vary, for each of which economists are ordinarily on the
“scientific” end and anthropologists on the “humanistic” end:
• Mathematical models important, little emphasis on ethnography;

ethnography important, little emphasis on mathematical models
• Theoretical parsimony and few variables; holistic descriptions and
many variables
• Decisions analyzed as being made by indivisible, autonomous units
with specified goals; decisions analyzed as the end result of negotia-
tions among individuals and groups with differing goals
• “Economy” and “society” treated as separate spheres of analysis;
economy treated as being embedded in society and culture
• History and evolution of economic institutions irrelevant to analysis;
history and evolution of economic institutions part of analysis
• Laboratory experiments regarded as informative about behav-
ior in the wider world; skepticism about usefulness of laboratory
experiments
Such abstract comparisons of the mathematical models of economists

and the ethnographic descriptions of anthropologists do not tell us any-
thing about the relative usefulness of ideas from these fields in assessing
diverse types of decisions. That is why this book examines in detail the
approaches of economists and anthropologists to five classic issues in de-
cision making. The methods and assumptions of mainstream economics,
exemplified by rational choice theory, seem more useful for the analysis
of some of these problems than they are for others. For one of the issues I
look at, the value of unpaid work, the approaches of conventional econo-
mists are dominant; critiques from scholars in other disciplines have had
little impact. For the other problems examined here, critiques of main-
stream economics by anthropologists, cognitive psychologists, political
scientists, and sociologists have challenged important aspects of rational
choice approaches.
Choices between Paid and Unpaid Work
People in market societies often must choose between paid and unpaid
work. Because of difficulties associated with assigning monetary costs and
benefits to unpaid work, however, the statistics and analyses of econo-
mists often ignore subsistence production, household labor, and commu-
nity service. Heterodox economists, anthropologists, and feminist schol-
ars in diverse disciplines have therefore cogently criticized conventional
economic analyses for downplaying the contributions of unpaid labor to
society.
Although there have been numerous calculations of the monetary
“values” of subsistence production and unpaid labor in market societies,
these can be lumped fairly easily into two principal methods. Both are
consistent with the ideas of mainstream economics and rational choice
theory. The first is to calculate an opportunity cost, the monetary re-
turns from alternative paid work. The second is to calculate a replacement
value, the cost of hiring someone to carry out an unpaid activity. These
methods can result in very different estimates of the monetary value of
subsistence crops and unpaid work. Moreover, there are certain empirical
and logical difficulties associated with calculations of both opportunity
costs and replacement values. Neither method, for example, pays much
attention to what the decision makers themselves see as the costs and
benefits of different types of work. Nonetheless, few people who have
Conclusion 167
thought seriously about this issue have come up with plausible alternative
ways of measuring the value of subsistence production and unpaid work.
Risk, Uncertainty, and Decision Making
The analysis of decision making in risky situations is a basic part of ratio-

nal choice theory. Economists have developed elaborate mathematical
models of risk that have been used as guidelines for stock market invest-
ments and other resource allocation decisions. These models, however,
often make unrealistic assumptions about the availability of information
and the ways in which most humans make choices. Although the short-
comings of rational choice approaches to risk have long been evident to
cognitive psychologists and anthropologists, such approaches have con-
tinued to be taught in textbooks in business and economics and used as
guidelines for decision making.
The dramatic failures of arcane risk-related investment tools such as
derivatives in recent years have led increasing numbers of scholars to
question conventional economic approaches to decision making in risky
situations. Inspired by the research of cognitive psychologists such as
Kahneman and Tversky, behavioral economists including Shiller (2000)
have urged that more attention be given to how people actually behave
when confronted with risky decisions. Economists and psychologists
have run countless experiments in laboratories aimed at determining how
people make choices when they cannot be certain of the outcomes of their
decisions.
The fundamental dilemma confronting these economists and psy-
chologists is the lack of a mathematically tractable conceptual framework
for dealing with uncertain situations in which decision makers have little
idea about how to estimate the probabilities of alternative outcomes. Both
economists constructing models of choice and cognitive psychologists
running experiments therefore often act as if the distinction between risk
and uncertainty is of relatively little importance. The shortcomings of
this approach are obvious during times such as the present, when no one
can be confident about the future performance of many components of
the global economy.
Although some famous economists wrote long ago (Keynes 1937,
Knight 1921) about decision making under uncertainty, as a group an-
thropologists have been more willing to emphasize limitations of con-
ventional assumptions about choices in risky situations. Frank Cancian

(1979) and other anthropologists have created models of decision making
incorporating the risk/uncertainty distinction. Most, however, have con-
fined their research to descriptions of the strategies that individuals and
groups have developed in different times and places to cope with multiple
risks and uncertainties. These ethnographic descriptions are an impor-
tant complement to the models of economists and the experiments of
psychologists.
Choices about Cooperation
The fundamental assumption of rational choice theory is that individuals

and groups making decisions act in ways to further their self-interest. A
difficult theoretical question confronting economists therefore is how to
analyze the many situations in which the self-interest of individuals differs
from the interests of the groups and societies they belong to. Sociocul-
tural anthropologists, unlike economists, do not ordinarily regard differ-
ences between individual and group goals as a challenge to their under-
lying theoretical assumptions. Anthropologists (along with sociologists
and political scientists) have long emphasized how societies are organized
to prevent individuals from behaving in ways—including the excessive
pursuit of self-interest—that are harmful to their groups. In introductory
courses, anthropologists teach how mores against selfishness in unstrati-
fied societies are enforced via ridicule, gossip, and the threat of banish-
ment; they also point out how in state societies institutions such as laws,
courts, police, and jails prevent the untrammeled pursuit of self-interest.
Such legal and social sanctions might with difficulty be fit into ratio-
nal choice theories by arguing that individuals pursue their self-interest,
given the constraints of the particular society in which they live. Such an
ahistorical approach, however, begs the question of how and why these
legal and social sanctions evolved. Furthermore, much of culture acts to
make individuals want to behave much of the time in ways that are useful
to society—that is, to behave morally—even if this involves deferred
gratification and sacrifice. This cultural morality transmitted across gen-
erations often involves sharing resources and treating others fairly.
Much has been written in diverse social and natural sciences about
the advantages and disadvantages of cooperation in particular situations
among humans and other species. Where cooperation is mutually benefi-
cial for two or more parties, the rational choice models of economists and
Conclusion 169
the evolutionary theories of biologists can be useful in understanding why

certain choices are made. Much of anthropological theory and ethnogra-
phy also concerns the reasons for and the nature of cooperation in such
circumstances. Evolutionary biologists interested in altruism, economists
using game theory, and anthropologists examining decision making, how-
ever, are less certain why members of human and other species cooperate
with one another when this incurs costs for some parties. These scholars
are especially interested in situations in which individuals demonstrate
their willingness to cooperate with others by altruistically incurring costs
in order to punish selfish behavior that is harmful for their group.
Behavioral economists and experimental psychologists have attempted
to examine altruism by running experiments, most notably the Ultima-
tum Game, in controlled situations in laboratories. Most of these ex-
periments have been conducted in western industrial countries. A few
heterodox anthropologists have attempted to examine their cross-cultural
validity by running similar experiments in nonwestern, nonindustrial set-
tings. The anthropologists conducting these experimental games all have
carried out detailed ethnographic studies among the participating groups.
They have the ambitious goal of combining the rigorous model building
and experimentation of evolutionary biology, economics, and psychology
with the cross-cultural perspective and ethnography of anthropology.
The reception to these cross-cultural experiments illustrates well how
unenthusiastic most anthropologists are about this kind of research. The
results of the experiments have been widely discussed among economists
and psychologists and given extensive publicity in the popular media.
There has been, however, much less interest in these experiments among
economic anthropologists, whose ethnographic research is often directly
concerned with relevant issues in decision making. The reason for this
lack of enthusiasm, I think, is that the experiments—notwithstanding the
researchers’ cultural knowledge—seem “unanthropological” in their as-
sumption that research in controlled quasi-laboratory settings can shed
light on decision making in the wider world.
Problems with Methodological Individualism
The methodological individualism characteristic of economics causes

certain difficulties in analyses of the value of unpaid work, the effects of
risk and uncertainty on decision making, and choices about whether to
cooperate with others. Rational choice theory requires that a unit of some
sort (such as an individual, household, or business firm) attempts to maxi-

mize its “utility” when making decisions. Economists only occasionally
worry about whether this assumption of a unitary decision maker makes
sense. Yet choices such as growing new cash crops, undertaking dangerous
border crossings in search of higher wages, and working with one’s neigh-
bors in a cooperative cannot be neatly pigeonholed as either individual or
group decisions. They are often the outcomes of discussions and nego-
tiations. In some cases, individuals make decisions that are disapproved
by most other members of their group. In other situations, group norms
and social institutions constrain the types of decisions that individuals
are able to make.
Methodological individualism is an especially serious impediment to
the understanding of household decision making. Economists typically
regard households as unitary decision makers that may make important
choices about consumption and production. But households usually con-
sist of several members, whose interests and goals can differ. Furthermore,
in many places households can be difficult to delineate because individuals
in different dwellings cooperate in some but not all economic activities.
Even when economists like Gary Becker recognize these difficulties, they
ordinarily resolve them by assuming that one member of a (supposedly
unproblematically delineated) household has the power to compel other
members to act in the interest of all residents. This lack of realism has
often led anthropologists and sociologists to be skeptical of economic
analyses of household decision making.
The question of units of analysis is also key to the understanding of
tragedies of the commons in which individuals have unrestricted access
to publicly held resources. In influential publications starting in the late
1960s, Garrett Hardin, a biologist borrowing methods from economics,
pointed out that in these situations decision-making units such as indi-
viduals, households, and businesses pursuing their self-interests often
destroy common resources. His solutions to such dilemmas, all consis-
tent with rational choice theory, include privatizing resources where pos-
sible and restricting individual access to common property via laws and
incentives.
Scholars from diverse disciplines, including anthropology, have shown
that the assumptions about unitary decision makers lead to mistaken de-
pictions of how societies around the world have dealt with commons
issues. In very few circumstances do individuals actually have untram-
meled access to public resources. Instead, in most places supra-individual
social groups exert substantial but not complete control over such access.
Conclusion 171
An analysis of commons situations therefore requires ethnographic de-

scriptions of both the extent to which individuals have access to common
resources and the ways in which customs, social institutions, and laws
constrain such access. Perhaps in part because of the limitations of meth-
odological individualism, economists have not been particularly promi-
nent in studies of the use of common resources. Even when the Nobel
Prize in Economics was given in 2009 to a scholar conducting research
on commons, the winner was a political scientist, Elinor Ostrom, whose
ethnographically oriented work explicitly challenged some of the assump-
tions of mainstream economics about decision-making units.
Final Thoughts
My principal aim in this book has been to contrast economic and anthro-
pological approaches to the analysis of decision making. Both approaches
provide useful insights about decision making. Economists are able to iso-
late important variables relevant to choice and to state clearly how these
variables might be related. Anthropologists provide cross- cultural data
that can be used to test economic theories; they also describe well the
complexities of many decision-making situations. There are also short-
comings to both approaches. Economists too often oversimplify, make
unrealistic assumptions, ignore history and culture, and downplay factors
influencing choice that are difficult to quantify. Anthropologists too often
express ideas imprecisely, mindlessly oppose quantification, and refuse to
generalize.
Much of this book has consisted of critiques of economic approaches
to choice. There are several reasons I have focused more on the short-
comings of economists’ analyses than on those of anthropologists. Eco-
nomics is a much more influential discipline. Economists are important
policy makers in national, regional, and local governments; anthropolo-
gists rarely hold such positions. Newspapers, bookstores, and libraries
are filled with economists’ explanations of the causes of assorted finan-
cial crises; anthropologists’ views on such matters receive little pub-
licity. Furthermore, many economists openly disdain or intentionally
ignore anthropological ways of looking at decision making. Moreover,
economists’ willingness to make explicit assumptions makes it easy to see
exactly what they are leaving out of their analyses.
I am not suggesting that anthropology can or should replace economics
as the principal method for thinking about decision making. Any anthro-
pologist reading this book will notice that I totally ignore or mention only
in passing whole schools of thought in our discipline that are devoted in
part to a consideration of economic institutions. Much of the writing
by scholars adopting these theoretical frameworks is, in my view, dense,
opaque, and of little practical use. In the language of some such scholars,
I have not made the effort here to “unpack” or “interrogate” these ap-
proaches. The ideas of these anthropologists have had practically no im-
pact outside of academia. My advocacy of anthropological approaches is
not an argument in favor of our grand theoretical proclamations; instead
it is a plea for more attention to ethnography.
The examination here of five important issues in the analysis of deci-
sion making suggests that the methods of economics are of limited use in
the understanding of key aspects of decision making. These methods must
be complemented with more descriptive approaches that consider the
context within which choices are made. If economics and anthropology
were equally influential disciplines, this would be a banal conclusion emp-
tily asserting the advantages of diverse perspectives. But in the world as it
is, the virtues of ethnography seem worth mentioning.
Notes
Introduction
1. University of Chicago, “The Sveriges Riksbank (Bank of Sweden) Prize in

Economic Sciences in Memory of Alfred Nobel for 1992,” press release, Octo-
ber 13, 1992. http://home.uchicago.edu/~gbecker/Nobel/nobel.html.
2. Scott Cook argues (2004:87–120) that the formalist-substantivist debate
remains important.
3. As will be seen in later chapters, behavioral economists and experimen-
tal psychologists have devised various methods in their attempts to make such
comparisons. The usual method is to ask a series of hypothetical questions, for
example, whether people would prefer a certain amount of money but no cham-
pionship or a championship and no money.
4. All names of people discussed in this example are pseudonyms.
5. A good example of such work is an essay by Michael Hudson (2010) entitled
“The Use and Abuse of Mathematical Economics.” Hudson’s scathing critiques
of his professional colleagues echo much of what I say more gently in this book.
For example, Hudson argues (ibid:14) that “lacking empirical testing and mea-
surement, economics narrows into a mock-science of abstract assumptions with-
out much regard as to whether its axioms are historically grounded.” He later says
(ibid:17):
The word “exogenous” is heard so often these days . . . that one wonders what is
left in economics proper. At issue for a more relevant empirical economics are the
dynamics of social history, political institutions and the environment, not just the
mechanics of supply and demand.
Chapter 1
1. The ways I picked these textbooks might be of minor interest to students

of decision making. Samuelson’s text (formerly sole-authored) is doubtlessly the
174 Notes to pages 37–82
most famous in the field. Mankiw’s blog was familiar to me. I had not previously
known about the McConnell and Brue book but learned that it was the current
best-seller. Because the most recent editions of these textbooks were very expen-
sive (more than $100 apiece) and unavailable at my university library, I decided to
buy earlier versions via the Internet, thinking that the sections I was interested in
had probably not changed much. Rational choice theory can deal with this latter
choice easily. The reasons beyond my selection of these particular three text-
books, however, can only with difficulty be understood by mainstream economic
theory.
2. This argument is made at length in one of my first articles, Chibnik 1981.
Chapter 2
1. More precisely, the economic idea of “rationality” assumes that individu-

als of groups attempt to either maximize or minimize one particular goal such as
money or time. These maximization or minimization assumptions often include
certain constraints. For example, an economist might try to determine the best
way to maximize income from sales with no more than X number of employees
working no more than Y hours a week.
2. British Honduras was not on the metric system at the time of my research.
Nowadays, most Belizeans continue to use “English” units of measurement.
3. This distinction has been made by diverse scholars including Aristotle,
Adam Smith, and Marx. See Hornborg 2001:89–90, Sahlins 1972:83–85.
4. Chayanov’s advocacy of peasant farming and opposition to the collectiviza-
tion of agriculture eventually resulted in his death in 1937 in one of Stalin’s purges.
5. Contemporary scholars generally agree that many of Chayanov’s ideas can
be phrased in the language of classical economics.
6. Delang asserts (without giving reasons) that different techniques of evalua-
tion would be needed to estimate the economic value of other types of NTFPs
(2006:66).
Chapter 3
1. This credit program ended in the early 1990s.

2. If the chances of a farmer defaulting in any one year were 1 in 10, the proba-
bility that a farmer borrowing in 10 different years defaults at least once is 1 −
(9/10)10 = 65 percent. The actual probability of default was greater than 1 in 10 in
most years and in some years was as high as 1 in 3. Making the unrealistic assump-
tion that it is exactly 1 in 5 every year, the probability that a farmer borrowing in
10 different years would default is 1 − (4/5)10 = 89 percent.
3. In The Black Swan: The Importance of the Highly Improbable (2007), Nassim
Nicholas Taleb argues that investors often suffer disastrous losses by ignoring the
possibility of unlikely events. This cranky, eccentric, insightful book was widely
cited during the stock market crash of 2008–2009.
4. I do not know how important women were in Paez agriculture at the time
Notes to pages 85–126 175
Ortiz did her research. Certainly many of the decisions she describes were made
by family groups in which women had some influence. Ortiz’s use of the pronoun
“he” to describe a farmer was, of course, conventional in the 1970s.
5. I have argued (in Chibnik 1981) that much of cultural evolution consists of
information gathering and small-scale experimentation resulting in the develop-
ment of such heuristics (“cultural rules”).
Chapter 4
1. This section about the ideas of evolutionary biologists is largely based on

the lucid discussions in Dugatkin 2006.
2. Hamilton at one point pursued the possibility of studying social anthro-
pology at Cambridge with Edmund Leach along with genetics. Hamilton’s ap-
proach to altruism was unpalatable to Leach, who discouraged the prospec-
tive student; the geneticists were also unenthusiastic about the idea. Dugatkin
2006:90–91.
3. Wilson later came to have doubts about the explanatory power of kin selec-
tion. Wilson and Hölldobler 2005.
4. In public goods games, each participant starts with a certain amount of
money. Players may contribute, if they wish, some or all of their money to a group
project. For each unit of money X contributed to the group project, every group
member (including those contributing nothing) earns M (where M is greater than
X) units of money. For example, each participant might start off with $10. For
every dollar contributed to the group project, each member might receive $2.
Let us say there are three participants—A, B, and C. A contributes $4, B $2, and
C nothing. A gets $10 − $4 + (6 × $2) = $18; B gets $10 − $2 + (6 × $2) = $20,
and C gets $10 + (6 × $2) = $22. The least generous participant ends up with the
most money.
5. Note that this case is an exception to the project’s generalization that mem-
bers of foraging societies tend not to be generous in the Ultimatum Game.
Chapter 5
1. Although many of these “spouses” were not legally married, they were in-
volved in long-term relationships and were regarded by the community as being
married couples.
2. I ended up surveying 82 of the 84 farming households in the three
communities.
3. The economic situations in Belize and the Peruvian Amazon have obvi-
ously changed since I conducted my fieldwork. The standard of living in the part
of Belize where I conducted research in the 1970s is comparable nowadays to that
in contemporary Oaxacan wood-carving communities. The area of the Peruvian
Amazon where I did fieldwork in the 1980s, however, is still much poorer (by any
measure of well-being) than contemporary Oaxaca and Belize.
4. Migration rates from Belize to the United States nowadays are comparable
176 Notes to pages 142–159
to those in Oaxaca. There is still relatively little migration from the Peruvian
Amazon to other countries; most migration from the rural villages where I did
research is to the city of Iquitos.
Chapter 6
1. Hardin’s metaphor of a pasture was taken from lectures by William Forster

Lloyd at Oxford University in the 1830s. Lloyd 1977.
2. This is obviously related to the discussion in the previous chapter about the
extent to which households can be regarded as economic units.
3. About once a decade, small incidents escalate into “lobster wars” in which
dozens of men attack one another’s equipment. Acheson 1979:271.
4. The three models discussed by Ostrom are the tragedy of the commons, the
prisoner’s dilemma, and the logic of collective action. The prisoner’s dilemma is a
situation when two people have been arrested and accused of committing a crime
together. If neither confesses, both receive short sentences. If both confess, each
receives a medium-length sentence. If only one confesses, the betrayer goes free
and the mute accomplice receives a long sentence. Under these circumstances, the
best game theory strategy for each individual is to confess, leading to an outcome
that is worse than if neither confessed. The prisoner’s dilemma has often been
used as a metaphor for situations in which individuals pursuing their own self-
interests cause problems for larger groups. The logic of collective action refers to
the ideas of Mancur Olson (1965) challenging the viewpoint that individuals with
common interests would voluntarily act to further these interests. Olson antici-
pated Hardin in arguing that someone who cannot be excluded from obtaining
the benefits of a collective good has little incentive to contribute voluntarily to
the production of that good.
5. Even though Ostrom’s best-known publications appeared after Brox wrote
his article, her work was already influential among commons researchers during
the 1980s.
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Index
Ache of Paraguay, 108 choice theories, 2–3; rejection of

Acheson, James, 150, 152–155, 159 risk models from other disciplines,
agency, 31, 34 84–87; and risk, 61, 81–87, 167–168;
Agrarian Bank (Peru), 66–67, 71, 146 and risk models from other disci-
Agrawal, Arun, 149–150, 151, 153, plines, 81–84; and uncertainty, 61,
157–158 83. See also economic anthropology
agriculture. See cash crops; subsis- Arab-American Chaldeans, 115
tence agriculture Aristotle, 174n3 (chap. 2)
Akerlof, George, 16 Ashcraft, Norman, 41, 42
Alersey-Williams, Hugh, 86 asymmetric information, 16
altruistic behavior: and cross-cultural Aumann, Robert, 162
economic experiments, 99; and Au of New Guinea, 108, 111
evolutionary biology, 99–101, 103, availability heuristic, 78–80, 85
104, 117, 156, 169; and free-rider Axelrod, Robert, 101
problems, 156; and household eco-
nomic decisions, 136–138; origins Baksh, Michael, 87
of, 91–92, 93, 97 Baron, Jonathan, 80
Alvard, Michael, 109 Barr, Abigail, 109
Amster, Randall, 161 Barth, Fredrik, 32
anthropology: approaches to choice, Bator, Francis, 15
2–5, 19, 23–24, 25, 26, 31–35, Becker, Gary, 1–3, 5, 136–138, 140, 160,
36, 171; approaches to decision 170
making, 1–2, 21, 31–35, 61, 81–87, Beckert, Jens, 77
89, 140, 165–168, 171–172; and behavioral ecology models, 83–84
common property, 152–153, 159, behavioral economics, 16, 114, 164,
160, 163; economic experiments in, 167, 169
90–93, 98, 99–103, 105–116, 117, 165, Belize: agricultural development in,
169; holistic tradition of, 3, 28, 90, 41–42; choice in rural Belize, 20,
165; and household economic de- 21–24; Creoles of, 40, 42, 43, 121;
cisions, 118–119, 130–134, 170; and economic conditions of, 175n3
practice theory, 35; and rational (chap. 5); ethnic groups of, 39,
40–41; forest work in, 42; Gari- 6–7; issues in analysis of, 17–19;
funa (Caribs) of, 40, 43, 121; and practice theory, 35; restraints
households defined in, 119–123, 125, on, 22; and science-humanities
126, 129–130; marriage in, 24, 175n1 continuum, 164–166; sociologi-
(chap. 5); Mayas in, 24, 40–41, 42, cal approaches to, 25, 31–35, 164–
43, 121; and migration to United 165, 166. See also decision making;
States, 175–176n4; tourist industry rational choice theories
in, 22, 39 Cliggett, Lisa, 34
Bender, Donald, 131 cognitive psychology: critiques of
Bentham, Jeremy, 1 economics, 166; and knowledge of
Binford, Leigh, 127 concepts of probability, 18, 78; and
Blanchard, Olivier, 76–77 risk, 61, 78–80, 81, 85, 88, 89, 167;
Boettke, Peter, 160 and suboptimal choices, 2; and un-
Bohannan, Paul, 131 certainty, 61, 88
Boyd, Robert, 103 Cohen, Jeffrey, 128
Briscoe, Simon, 86 common property: anthropologi-
Britain, and Belize, 22, 40, 41 cal approaches to, 152–153, 159,
Britan, Gerald, 32 160, 163; comparative studies of,
British Honduras. See Belize 155–159; economic approaches to,
Brox, Ottar, 159–160, 176n5 159, 160, 161; and ethnography,
Brue, Stanley, 29, 174n1 (chap. 1) 149, 150, 162, 163, 171; and govern-
Bush, George W., 28 ment intervention, 144, 148, 149,
151, 152, 153, 155; interpretations of,
Cancian, Frank, 81–85, 168 159–160; and Maine lobstermen,
capitalism: capital-intensive agricul- 152, 154–155, 176n3; and nucleated
ture, 54; and fairness, 105; and and perimeter-defended areas, 154–
household economic decisions, 139; 155; in Peruvian Amazon, 144–149;
and unpaid work, 136 political reactions to, 160–162; and
cash crops: agricultural credit for, resource conservation, 149–151,
65–67; calculating monetary value 154–155, 157–158, 160; and resource
of, 43–44, 47; earning income destruction, 142–143, 149, 152,
from, 20, 21–22, 43; risks of, 21, 43, 170; restrictions on, 143, 144, 145,
48–49 147, 148, 151, 152, 170; and self-
Cassidy, John, 15 interests, 19, 160
centrally planned economies, 30 competition, 4–5, 91, 93, 95–96, 97, 98
Chamberlin, Edward Hastings, Comte, Auguste, 1
103–104 consumption: and economic anthro-
Chayanov, A. V., 45–47, 51, 57–58, 132, pology, 5; and household behavior,
135–136, 174nn4–5 135, 136, 140, 141, 170. See also pro-
choice: anthropological approaches duction for home consumption
to, 2–5, 19, 23–24, 25, 26, 31–35, 36, contingent valuation, 51, 52
171; consequences of, 35–36; con- Cook, Scott, 127, 173n2
text of, 19; and cost-benefit analy- cooperation: benefits of, 97–98; co-
sis, 38–39; economic approaches to, operative work groups, 124–125,
1–5, 19, 21, 24–31, 33, 36, 118, 164, 129; distinctiveness of human co-
165, 167, 171; and expected utility, operation, 101–102, 116; and evolu-
Index 199
tionary biology, 18, 90–91, 97, 99, 6, 21, 23, 24–31, 61, 74–78, 87–88,
101–102, 104, 116, 169; and experi- 161, 163, 165–166, 171–172; and eco-
mental economics, 91, 93, 104, 114; nomic experiments, 114; effects of
genetic explanations for, 102–103, risk aversion on, 4; ethnographic
110; and household economic deci- approach to, 5, 12, 18, 81, 86, 89,
sions, 139; and households, 121; and 163, 165, 166, 172; expected utility
kin selection explanation, 100, 116, models of, 6–7, 8; long-term con-
117; and Oaxacan wood carvers, sequences, 7, 13, 14, 71, 72–73,
95–97, 98, 117; and rational choice 98; short-term consequences,
theories, 92, 116, 168–169; and tit- 7, 13, 14, 71, 72–73, 98; signifi-
for-tat strategy, 101; and Ultima- cance of, 35–36; and social institu-
tum Game, 110, 111, 112, 113, 115 tions, 31, 32, 36; and unpaid versus
cost-benefit analyses, 38–39, 71, 73 paid work, 57; and women, 134,
Cruz, Isidoro, 94, 95–96, 97, 98 174–175n4. See also choice; house-
cultural change, 17, 31, 32, 37 hold economic decisions; risk;
cultural evolution, 45, 102, 103, 151, uncertainty
175n5 (chap. 3) decision-making units, 7, 13, 14, 17,
cultural norms: and common prop- 18–19. See also household economic
erty, 19, 144, 154; and cooperation, decisions
115, 116–117; and decision making, Delang, Charles, 51, 52–53, 57, 174n6
31, 32, 33, 36, 81, 164; and ethnog- democracies, 26, 92
raphy, 113; and Oaxacan wood Denich, Bette, 32
carvers, 98 dependency theory, 5, 22–24
cultural practices: effect on decision Dictator Game, 114, 115
making, 26; history as influence on, diversified activities, and risk and un-
3, 4, 5; reductionist explanations certainty, 71, 73, 89
of, 8; and substantivist approach to Domestic Labor Debate, 136
economic choices, 23–24; utilitar- domestic labor (housework), 38, 48,
ian explanations of, 6, 7, 8 53, 55–57, 58
cultural transmission of ideas, 99, 102, dot-com boom of late 1990s, 16
103 Douglas, Mary, 85–86
culture-gene coevolution, 99 dual inheritance theory, 103
dual systems theory, 139
Darwin, Charles, 91, 100
Dawkins, Richard, 100 earning income, choice in, 20, 21–24
decision making: anthropological ecological anthropology, 3–4, 83–84,
approaches to, 1–2, 21, 31–35, 61, 149
81–87, 89, 140, 165–168, 171–172; ecological economics, 52
cognitive psychological approaches economic anthropology: approaches
to, 61, 78–80, 88, 151; complexity to decision making, 21, 85, 86–87,
of, 71, 74, 76, 88, 89, 98, 171; and 169; and common property, 149,
cooperation, 104; and cultural 152; experiments in nonwestern
norms, 31, 32, 33, 36, 81, 164; de- field sites, 18, 169; and formalist-
bates on, 21; economic anthropo- substantivist debate, 4, 21, 23,
logical approaches to, 21, 85, 86–87, 32–34, 36, 173n2; and household
169; economic approaches to, 1–2, economic decisions, 132–133, 134;
and models of choice, 165; relation- fining households, 18; and eco-
ship with mainstream economics, nomic anthropology, 4, 99; and
4–5, 17, 81, 87 economics, 17; and fieldwork, 4, 23;
economics: approaches to choice, and household economic decisions,
1–5, 19, 21, 24–31, 33, 36, 118, 164, 141; limitations of, 22; and models
165, 167, 171; approaches to deci- of human behavior, 93; and ratio-
sion making, 1–2, 6, 21, 23, 24–31, nal choice theories, 2–3, 5, 14; and
61, 74–78, 87–88, 161, 163, 165–166, risk, 86–87, 89, 168; value of, 5
171–172; assumptions of, 21, 27–31, evolutionary biology: and altruistic
36, 93, 104, 137, 141–142, 169–170; behavior, 99–101, 103, 104, 117, 156,
and common property, 159, 160, 169; and cooperation, 18, 90–91,
161; and constraints on deci- 97, 99, 101–102, 104, 116; and cross-
sion making, 21, 24–31; and cost- cultural economic experiments, 18,
benefit analysis, 38, 39; defining 90–91, 93, 99–103
of, 29, 32; experiments in, 84, 91, evolutionary models, 83–84
93, 103–105, 114, 115, 117, 164, 165, evolutionary psychology, 3, 109–110,
167; and generous behavior, 92; 113, 165
and global recession of 2008–2009, exchange value, use value distin-
15; and household economic deci- guished from, 45
sions, 118–119, 134–140; and mathe- expected utility theory: and alter-
matical models, 17, 19, 24–25, 28, native outcomes, 6, 36; and cost-
36, 39, 74–77, 81–82, 83, 87, 88–89, benefit analysis, 38; and economic
135, 137, 162–163, 164, 165, 166, 167; anthropology, 81; and economic
and migration from Mexico to models, 75, 87–88; estimates of,
United States, 14; neoclassical eco- 7; and experimental economics,
nomic theory, 25, 33, 34, 46, 118, 84; and rational choice theories,
135, 139, 140, 161; relationship with 6–7; and risk, 18, 80, 82, 84–85, 87
economic anthropology, 4–5, 17, experimental economics, 84, 90–93,
81, 87; and risk, 74–75, 81–82, 87, 103–105, 164
88–89, 167; textbooks of, 28–31, experimental psychology, 164, 165,
173–174n1; and uncertainty, 61, 76, 167, 169
77–78, 87 Experimental Technology Incentives
economic systems, 30 Program (ETIP), 54
education, and Oaxacan wood carvers,
69, 70, 72 fairness: and experimental economics,
Ellsberg, Daniel, 80 104–105; and markets, 105, 113; and
embeddedness concept, 21, 23, 32, self-interest, 104, 168; and Ultima-
33–34, 36, 130, 165 tum Game, 105–106, 107, 109
Ensminger, Jean, 108, 109 Fehr, Ernest, 102–103
environmental conservation, and feminist theory: and autonomy and
property rights, 149–150, 153 power of women, 133, 134; and eco-
ethnography: and common property, nomics, 17, 165; and household eco-
149, 150, 162, 163, 171; complexity nomic decisions, 118–119, 120, 134,
of, 93; and cultural differences, 3; 139–140, 141; and unpaid labor, 166
and decision making, 5, 12, 18, 81, feudalism, 31
86, 89, 163, 165, 166, 172; and de- fieldwork, 4, 23
Index 201
firms: and microeconomics, 26–27, 30; population, 143, 148, 149, 151, 153;
production of, 135 pasture analogy, 142, 143, 160,
Firth, Raymond, 32, 37, 130 176n1; reactions to, 149–151
Folbre, Nancy, 139 Harford, Tim, 7–8, 9
foraging societies: optimal foraging Hayek, Fredrich, 162
theory, 3–4, 45, 84; and Ultimatum Henrich, Joseph, 90, 92, 101–102, 103,
Game, 107, 108, 113, 175n5 (chap. 4) 106–107, 111, 115
Freudian psychologists, 165 Henrich, Natalie Smith, 101–102, 103,
Friedman, Milton, 27–28, 29, 36, 160, 111, 115
161 herd mentality, 15–16, 78
history: approaches to choice, 165; and
game theory: and cooperation, 169; common property, 149, 163; cul-
and economic experiments, 104, tural practices influenced by, 3, 4,
106; and household economic de- 5; economic approaches to, 2, 17,
cisions, 118, 138–139, 141; and pris- 36; holistic methods of, 28
oner’s dilemma, 176n4 hog lots, 54–55
gender relations: and household eco- household economic decisions:
nomic decisions, 118, 137, 138–139. anthropological approaches, 118–
See also men; women 119, 130–134, 135, 140, 141; and
generosity: and Dictator Game, 115; Belize, 119–123; economic ap-
and Ultimatum Game, 106, 107, proaches, 118–119, 134–141; and
110, 175n5 (chap. 4) methodological individualism, 170;
Gentry, Alwyn, 50, 51 and Oaxacan artisan communities,
globalization, 5, 23 13, 127–128; and shared resources,
global recession of 2008–2009, 15, 118, 120, 121, 129–130, 134, 135, 137,
60–61, 76–77 140, 141; and women, 118–119, 120,
Gnau of New Guinea, 108, 111 126, 133, 137
Granovetter, Mark, 33–34 households: and access to common
gross domestic product, 39, 58 property, 147; concept of, 131, 170;
groups: decision making influenced defining, 18, 20, 118, 119, 120–130,
by, 7, 14; supra-individual charac- 132–133, 134, 140; economic models
teristics of, 3. See also household of behavior, 59; as independent
economic decisions economic units, 132; interrela-
Guatemala, 22, 32, 40, 41 tionship between production and
Gurven, Michael, 109, 111, 115–116 consumption, 136, 140, 170; labor
Gutiérrez, Tonatiúh, 94 allocation in, 4, 43, 69–70, 71, 119,
133; and microeconomic analyses,
Hadza of Tanzania, 108, 110–111 26–27, 30
Haldane, J. B. S., 100 housing bubble, 16
Hamilton, William, 100, 101, 175n2 Hudson, Michael, 173n5
(chap. 4) human behavior: and concept of
Hammel, Eugene, 133 rationality, 7–9; economic ap-
happiness, 6, 173n3 proaches to, 1, 17, 99
Hardin, Garrett: on common prop- hunting for home consumption, cal-
erty, 142–144, 145, 148, 152, 154, culating monetary value of, 44, 45,
155, 156, 157, 159, 163, 170; on over- 46, 48
Hurwicz, Leonid, 162 Leach, Edmund, 175n2 (chap. 4)

Huxley, Aldous, 40 Lee, Richard, 45
leisure, 6
imperialism, 22–23 Lesorogol, Carolyn, 162
inclusive fitness, 100 Levitt, Steven, 114, 115, 161–162
individuals, decision making by, 5, 7, List, John, 114, 115
14, 17, 31, 32, 34, 35–36, 104, 144 Liu, Flora, 84
industrial societies: and cooperation, Lloyd, William Forster, 176n1
104; and households, 134, 141; un- Lucas, Robert, 15
paid labor in, 53–57 Lundberg, Shelly, 138
information gathering: converting un- Lupton, Deborah, 85
certainty into risk with, 71, 74, 80,
89; and cultural evolution, 175n5 Machiguenga, 45, 87, 90–91, 92,
(chap. 3) 106–107
input/output ratios, 22, 39, 43, 45 macroeconomics: effect of policies on
International Monetary Fund, 76–77 choice, 20, 21; and markets, 30–31;
and no-till farming in Iowa, 62–63;
Jiménez, Manuel, 94–98 as subfield of economics, 26–27, 30
Johnson, Allen, 45, 87 Maine lobstermen, 152, 154–155
Johnson, Craig, 150, 151, 158–159 Malthus, Thomas, 149
Ju/’hoansi Bushmen, 114–115 Mankiw, Gregory, 27, 29, 174n1
(chap. 1)
Kahneman, Daniel, 16, 78, 79–80, 162, Mapuche of Chile, 111
167 markets: in Belize, 42; and cash crops,
Kantorovich, Leonid, 162 48; and fairness, 105, 113; and
Karen (indigenous group), 52–53 formalist-substantivist debate of
Keane, Webb, 31 economic anthropology, 4, 33; and
Keesing, Felix, 131 macroeconomics, 30–31; and micro-
Keynes, John Maynard, 15, 77–78 economics, 26–27, 30; and Ultima-
kin networks: and anthropological tum Game, 91, 99, 107, 109, 111, 113
analysis of economics, 130; and ex- Marx, Karl, 1, 105, 174n3 (chap. 2)
change of goods and services, 4, Marxism, 17, 136, 139, 165
113, 131; and households, 133, 140; McCay, Bonnie, 150
kin selection explanations, 92, 99, McConnell, Campbell, 29, 174n1
100, 102, 104, 116, 175n3 (chap. 4); (chap. 1)
as social structure, 32 McElreath, Richard, 109, 111
Kling, Arnold, 161 Mellor, John, 47–48, 52
Knight, Frank, 61, 72 men, and household economic deci-
Knightean uncertainty, 61, 76, 77, 80, sions, 118–119, 140–141
81, 83, 88, 167 Mendelsohn, Robert, 50, 51
Krugman, Paul, 161 Mennonites, and Belize, 22, 41
Kunstadter, Peter, 132–133, 134 methodological individualism: and
Kyrk, Hazel, 136 formalists of economic anthro-
pology, 4, 21; and models of house-
labor allocation, models of, 21 hold consumption, 140, 141; prob-
Lamalera of Indonesia, 108, 109 lems with, 169–171; and rational
large-scale societies, 113–114 choice theory, 3
Index 203
Meyer, Donald, 75–76 Orma of Kenya, 109, 111

Meyer, Jack, 75–76 Ortiz, Sutti, 81–82, 83, 85, 174–175n4
microeconomics, 26–27, 30 Ostrom, Elinor, 142, 149–151, 156–162,
migration from Mexico to United 163, 171, 176nn4–5
States: advantages and disadvan- overpopulation, 143, 148, 149, 151, 153
tages of, 10–12; and artisans, 9–10;
and cost-benefit analyses, 73; and Padoch, Christine, 123–124
household definition, 126, 129, 175– paid labor: choices between paid and
176n4; and Oaxacan wood carvers, unpaid labor, 166–167; utility of,
68, 69, 70, 72, 73, 97; and rational 17–18, 43, 47. See also unpaid labor;
choice theory, 9, 12–14; and remit- wage labor
tances, 10, 11, 126; and wage dis- peasant societies, economics of, 32,
crepancy, 10 45–46, 174n4 (chap. 2)
Miller, Steven, 122 Peruvian Amazon: access to barreales
modernization, and embeddedness, 33 in, 144–149; agricultural credit
motivations, 3, 18 in, 65–67, 69, 71–74, 76, 88, 174n2
Murphy, Arthur, 127–128 (chap. 3); economic conditions of,
Muth, John, 15 175n3 (chap. 5); households defined
in, 123–125, 126, 129–130
Nash, John, 162 Peters, Charles, 50, 51
National Science Foundation, Cul- Plattner, Stuart, 91
tural Anthropology Program, 91 Polanyi, Karl, 4
natural selection, 100, 102 political economy, 3, 5, 22–23
New Household Economics, 136–137, political science, 2–3, 14, 164, 166, 168
140–141 Pollak, Robert, 138
non-timber forest products (NTFPs), positivism, 27
38, 48, 50–53, 174n6 postmodernism, in anthropology, 5, 9
no-till farming in Iowa, 62–63, 64, power: and access to common prop-
71–72, 73, 74, 76, 88 erty, 144, 146–147; and depen-
Novak, Martin, 102–103 dency theory, 22; and household
economic decisions, 133, 135, 137,
Oaxacan wood carvers: and coopera- 139–140, 141, 170; and individuals’
tion, 95–97, 98, 117; and cost- choices, 31, 34, 36, 118; of women,
benefit analyses, 73; diversified 133, 134
activities of, 73; and household practice theory, 35
definition, 125–130; and household preferences, 3, 4
labor allocation, 69–70, 71; and in- primates, and cooperation, 101–102
formation gathering, 74; openness prisoner’s dilemma, 176n4
and secrecy among, 93–97, 98; and probability judgments: and alterna-
risk, 69, 71, 72, 76, 88; and short- tive outcomes, 6, 7, 14–16, 18, 61,
term and long-term consequences, 75, 76, 87, 167; and cognitive psy-
72; and subsistence agriculture, 68, chology, 79–80, 85, 86, 88; and cul-
69, 70, 72, 73; and uncertainty, 69, turally learned conventions, 85–86;
71, 88 subjective probabilities, 75, 79–80,
Olson, Mancur, 176n4 84, 88
opportunity cost, 51–52, 53, 57, 58, 166 production for home consumption:
optimal foraging theory, 3–4, 45, 84 calculating monetary values for, 17,
43–44, 45, 46, 47–49; and feeding ribereños. See Peruvian Amazon
domestic animals, 44, 49 Richerson, Peter, 103
prospect theory, 79–80 risk: and agricultural credit in Peru-
public good: and cooperation, 116; vian Amazon, 66, 67, 71; anthro-
moral appeals to, 143; public goods pological approaches to, 61, 81–87,
games, 109, 175n4 (chap. 4); and 167–168; and behavioral ecology
restrictions on access to com- models, 83–84; and cash crops,
mons, 145, 147–148, 156; and self- 21, 43, 48–49; and cognitive psy-
interests, 92; and Ultimatum chology, 61, 78–80, 81, 85, 88, 89,
Game, 99 167; and cooperation and compe-
tition, 98; coping strategies for,
Quinn, Naomi, 84–85 73–74; disciplinary approaches to,
74–87; and earning choices, 20, 21,
rational choice theories: assumptions 43; and economic anthropology,
of, 104, 166, 169–170; and common 86; and economics, 61, 74–76,
property, 151; and cooperation, 87, 88, 167, 169; and ethnogra-
92, 116, 168–169; criticisms of, phy, 86–87, 89, 168; and expected
16–17; and economic anthropology, utility, 18, 80, 82, 84–85, 87; and
4–5, 9; and ethnography, 2–3, 5, experimental economics, 84; and
14; and expected utility, 6–7; and household economic decisions, 131;
formalist-substantivist debate, 32; multiple risks, 71–72, 76, 88, 98,
limitations of, 25; preferences in, 168; and no-till farming in Iowa,
3; and self-interests, 12–13, 29, 30, 64, 71, 72; and Oaxacan wood
31, 92, 168; strict versions of, 15–16, carvers, 69, 71, 72, 76, 88; risk-
18; and Ultimatum Game, 99, 106, uncertainty continuum, 61, 64, 67,
111; and utility maximization, 2, 71, 72, 76, 77, 88; theoretical ap-
143–144, 170 proaches to, 61; variability in esti-
rational expectations hypothesis, 15 mating, 72, 75
rationality: assumptions concerning risk aversion, 4, 75–76
rational behavior, 75, 82, 87, 106; risk avoidance, 6
broader meanings of, 7–9; eco- rules of thumb, 16, 84–85, 108–109
nomic idea of, 174n1 (chap. 2) Rumsfeld, Donald, 77
real-world situations: applying eco-
nomic models to, 9; and cultural Sahlins, Marshall, 8, 9, 132
norms, 115–116; and economic ex- Samuelson, Paul, 135, 136, 173–174n1
periments, 61, 114, 115, 117, 164; Sangu of Tanzania, 111
ethnographical descriptions of Santiago, Miguel, 94
decision making in, 18, 165; and scarce resources, 32
group decisions, 118; and Ultima- Scott, James, 34–35
tum Game, 112 self-exploitation, 57
Reddy, Sanjay, 86–87 self-interests: and common property,
Redfield, Robert, 113, 114 19, 160; and communal resources,
Reid, Margaret, 136 19; and expected utility, 6; and ex-
replacement value, and unpaid labor, perimental economics, 91; fairness
56–57, 58, 166 moderating, 104, 168; and markets,
representativeness heuristic, 78, 80, 85 105; and Oaxacan wood carvers, 97,
resistance, studies of, 23, 35 98; and public good, 92; and ratio-
Index 205
nal choice theory, 12–13, 29, 30, 31, subsistence production: imputing
92, 168; and Ultimatum Game, 115 value to, 44–47, 48, 49, 57, 58–59,
selfishness: intercultural differences 166–167; and non-timber forest
in, 106; mores against, 168; punish- products, 50–51
ment of, 99, 103, 104, 107, 115, 117; substitute product value, 51, 52–53,
and trait group models, 100; and 57
Ultimatum Game, 110, 112, 113 Surowiecki, James, 105
Sen, Amartya, 24–26
Shiller, Robert, 167 Taleb, Nassim Nicholas, 74, 174n3
Sigmund, Karl, 102–103 (chap. 3)
Skidelsky, Robert, 77–78 Tax, Sol, 32
small-scale experimentation, 71, 74, Taylor, C. Robert, 76, 77
175n5 (chap. 5) Thaler, Richard, 15
small-scale societies, 91, 107–108, Third-Party Punishment Game, 115
113–114 Thomas, Duncan, 138
Smith, Adam, 174n3 (chap. 2) tit-for-tat strategy, 101, 105
Smith, Natalie. See Henrich, Natalie Tracer, David, 111
Smith tragedy of the commons. See common
social constructivism, 81, 86 property
social institutions: and decision trait group models, 100
making, 31, 32, 36; and publicly tribal societies, economics of, 32
held resources, 19; and substantiv- tropical rainforests: value of, 50. See
ist position on economic choices, also non-timber forest products
21, 23–24, 32–33, 34; supra- (NTFPs)
individual, 21 trust, 104, 105, 113
social networks, 33, 34 Tsimane of Bolivia, 109, 111, 115
social organization, 32 Tucker, Bram, 84
social structure, 32 Tversky, Amos, 16, 78, 79–80, 167
sociology: approaches to choice, 25,
31–35, 164–165, 166; approaches to Ultimatum Game, 90–91, 92, 99, 105–
cooperation, 168; economic ap- 113, 114, 115, 169, 175n5 (chap. 4)
proaches to, 2, 33–34; and migra- uncertainty: and agricultural credit
tion from Mexico to United States, in Peruvian Amazon, 67, 71; and
14 cash crops versus wage labor, 21;
Spence, Michael, 161 and cognitive psychology, 61, 88;
spiteful behavior, 100–103, 104, 110 converting into risk, 71, 74; and
Stepick, Alex, 127–128 cooperation and competition, 98;
structure, 31, 34 coping strategies for, 73–74; dis-
subjective probabilities, 75, 79–80, 84 ciplinary approaches to, 74–87;
subsistence agriculture: and behav- and economic models, 76, 88, 169;
ioral ecology models, 84; in Belize, and ethnography, 89; and expected
40, 43, 44; calculating monetary utility, 18; and global recession of
values for, 38, 39, 43–44, 46–47, 2008–2009, 76–77; and household
48, 49, 166–167; and input/output economic decisions, 131; Knight-
analyses, 39; and Oaxacan wood ean uncertainty, 61, 76, 77, 80, 81,
carvers, 68, 69, 70, 72, 73; risks of, 83, 88, 167; multiple uncertain-
49 ties, 71–72, 88, 98, 168; and no-till
farming in Iowa, 64, 71, 72; and wage labor: in Belize, 42, 43, 119; cal-
Oaxacan wood carvers, 69, 71, 88; culating monetary returns from,
risk-uncertainty continuum, 61, 20, 21, 43, 47; and Oaxacan wood
64, 67, 71, 72, 76, 77, 88; theoretical carvers, 69, 70, 72, 73, 97. See also
approaches to, 61 paid labor
unpaid labor: calculating monetary Wales, Terence, 138
values for, 17, 38, 39, 46, 47, 48, Waring, Marilyn, 39, 55–57
51–52, 136, 166–167, 169; choices Warner, K. E., 74
between paid and unpaid labor, Wiessner, Polly, 114–116
166–167; domestic labor, 38, 48, 53, Wilk, Richard, 34, 122
55–57, 58; economists’ ignoring of, Wilson, E. O., 100, 175n3 (chap. 4)
135, 140, 166; imputing value to, wind power, 55
56–59; in industrial societies, 53, Winking, Jeffrey, 115–116
55–57, 134; and input/output ana- Winterhalder, Bruce, 84
lyses, 39; utility of, 17–18, 43; and Wirth, Louis, 113, 114
women, 55–56, 136. See also paid women: and decision making, 134,
labor 174–175n4; and household eco-
unpredictable consequences, 13–14 nomic decisions, 118–119, 120,
unsubstantiated beliefs, 16 126, 133, 137; and household labor
use value, 45, 49 allocation, 133; in Oaxacan arti-
U.S. Supreme Court, 35 san communities, 126; and unpaid
utility: defining, 13; maximization labor, 55–56, 136
of, 1, 2, 143–144. See also expected World Bank, 58
utility theory world systems theories, 5

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University of Texas Press Austin

First edition, 2011

Library of Congress Cataloging-in-Publication Data

1. How Important Is Decision Making? 20

2. Choices between Paid and Unpaid Work 38

3. Risk, Uncertainty, and Decision Making 60

4. Experimental Games and Choices about Cooperation 90

5. Who Makes Household Economic Decisions? 118

6. Is There a Tragedy of the Commons? 142

During 2008–2009 the world’s economy was mired in a terrible reces-

nomic institutions constrain the choices possible for different groups of

In 1976 I applied for a postdoctoral position in the Department of An-

I have come to the position that the economic approach is a compre-

By “the economic approach” Becker means one in which “all human

possible for different groups of people at particular places and times. My

Economic and Anthropological Approaches to Choice

theories appealing to many economists and political scientists and in-

Since economists have little to contribute . . . to the understanding of

Almost any anthropologist would be appalled by Becker’s casual assump-

getting patterns. Demographic anthropologists (such as Nag, White, and

resources (McCay and Acheson 1987). Such research differed greatly

The Value of Ethnography

Economic approaches to decision making have been criticized on both

Expected Utility and Rational Choice

Most contemporary versions of rational choice theories are based on

sion makers’ views about the probabilities of alternative outcomes

Broader Meanings of Rationality

Many books and articles about “rationality” discuss utilitarian expla-

readers. The critic is the famous anthropologist Marshall Sahlins, a long-

Rational people respond to incentives: When it becomes more costly

Harford’s comments are deliberately consistent with the expected

Without distinctive properties in its own right, culture has no title to

Sahlins here is not explicitly criticizing expected utility approaches to

Migration from Mexico to the United States

The problems associated with attempts to apply economic models to real-

Most migrants, however, are reluctant to leave Mexico. Crossing the

wood-carving demonstrations and sell pieces. After making several such

When Is Migration “Rational”?

The applicability of rational choice models has been questioned (Gladwell

The Uselessness of “Utility”

Short Term versus Long Term

Who Makes Choices?

Studies of migration ordinarily implicitly or explicitly assume that deci-

Ethnography and Rational Choice Models

Economists, political scientists, and sociologists taking rational choice

Economic Theory, Rational Choice, and the Financial Crisis

Lucas . . . [assumes] that everyone knows exactly how the economy

It would be foolish to argue—as anthropologists sometimes do—that

being mocked for nonconformist behavior. In certain respects it makes

niscient, calculating decision makers. Their often sensible policy rec-

Issues in the Analysis of Choice

The fundamental assumption of mainstream economics is that careful

problems associated with such comparisons and calculations, I conclude

Chapter 6 discusses influential theories about what has been called

How Important Is Decision Making?

[T]he difference between economics and sociology is very simple. Economics is

When I went to Belize in the fall of 1971 to conduct research for my

How Much Choice Did Rural Belizeans Really Have?

Much of my research for my doctoral dissertation consisted of attempts

of income-producing activities was affected by their particular circum-

histories and its unwillingness to grant agency to the activities of those