Collins Conference Room
Seminar
  US Mountain Time

This event is private.

Sam Bowles (Santa Fe Institute; University of Siena)

Abstract.  The economic and social systems of the past differed (among their many distinctions) along the following four dimensions:

1. the nature of risks to which individuals are exposed (exogenous or chosen) and its distribution (for example, idiosyncratic versus systemic);

2. the risk sharing and self insurance strategies  adopted (like private or public storage, common pot redistribution, social insurance) and whether these were ex post (redistribution from  the lucky to the unlucky) or ex ante specialization in risk taking (based on the individuals’ comparative advantage in risk bearing);

3. the extent of social opportunity costs when some or all of a population do not engage in taking risks,  and

4.  the implied degree of persistent wealth inequality resulting from the above.  

I characterize three abstract economies – forager, farmer, and industrial and service based capitalist – along these dimensions, evaluate how well each addresses the problem of risk sharing, draw parallels between these abstract economies and real economies from prehistory to the present,  and identify the challenges of redistribution, risk allocation or other risk sharing institutions in a future hypothetical  knowledge based economy.

Purpose: 
Research Collaboration
SFI Host: 
Jennifer Dunne