Don’t be an Egoist! On the Importance of Reciprocity in Public Policy

Lemon Shark with Remora

By Adam OliverDepartment of Social Policy, London School of Economics and Political Science

 

Of one sort or another, acts of reciprocity can be found everywhere. Reciprocity can be direct, indirect and negative, and when we reciprocate there is in general a concern both for the intentions of others and for the final distribution of outcomes. Reciprocity can be all of these things because its expression is contextual, and if care is not taken reciprocity can be crowded out for what many may perceive as our baser instincts. In an evolutionary sense perhaps the most fundamental reason for acting reciprocally is that it can bring about benefits and protection to the group. Via an enlightened form of self-interest, most people probably know innately that if the group of which they are a member does well, then they as individuals are likely to do well also, and over the long-term will do better than if they act egoistically in the moment. Out of this evolutionary process developed a social norm, a norm that links perceptions of kindness and unkindness by others as attempts to create, sustain and undermine group cooperation, and practices developed to punish (i.e. reciprocate negatively) those who are inclined towards the latter.

Reciprocity has roots that predate human kind, which suggests that it is something that is quite fundamental to the animal kingdom. Much of this animal behaviour is seemingly instinctive – e.g. cats licking each other – but actions that can be defined as attitudinal may have served as the kernel for the development of more complex forms of reciprocity. By common consent, however, a tendency towards more sophisticated forms of reciprocity that rely on memory and a sense of obligation is predominantly human. The urge to act reciprocally lies very deep within the human psyche. There is some evidence that very young children, for instance, show tendencies towards reciprocal altruism and altruistic punishment, and demonstrate some concern for a person’s reputation, which is crucial for the effective operation of indirect reciprocity.

By analysing practices in hunter-gatherer societies, we can gain a further indication of how deep reciprocity lies in humans. Indeed, reciprocity is of fundamental importance to the functioning of these communities. There, people reciprocate all the time – e.g. through sharing meat, childcare responsibilities, wisdom etc. – and gifts are used to bind and obligate. Moreover, the threat of negative reciprocity discourages the transgression of social norms and attempts to exert power. In tribal communities, it is likely that reciprocity evolved organically for the good of the group, but as societies became larger and more atomised, creating opportunities for people to act on egoistic motivations with less fear of being observed, a form of social contract, often manifested in religious codes, was perhaps needed to nurture and sustain the socially beneficial norm of reciprocity.

Behavioural economists, often in collaboration with psychologists, have undertaken a lot of work on reciprocity, typically in controlled laboratory experiments. These experiments demonstrate once again that the extent to which reciprocity is observed and sustained is dependent heavily on context, with repetition of the game, the inclusion or not of the opportunity to punish, anonymity between partners, whether the money on offer is windfall or earned, and a host of other possible factors all having an influence. The evidence on the whole also supports the notion that while intentions certainly matter, for reciprocity to be sustained over an extended period, outcomes matter too.

However, in the specific design of public policy interventions, reciprocity, somewhat mystifyingly, has until relatively recently been largely overlooked as a key motivator of human behaviour. Rather, the debate there has tended to focus on the dichotomy of pure altruism and selfish egoism, with the latter generally winning out over recent decades. And yet when we examine the writings of the classical economists we find that over complex goods, the assumption that people either should be or are selfish egoists is not necessary to the efficient functioning of the market exchange, let alone the social exchange. The modern supporters of using egoism to inform the design of public policy may contend that this admittedly ever-present aspect of human behaviour can be harnessed to positive ends, but by legitimising egoism we will perhaps crowd out the aspect of human behaviour – i.e. reciprocal altruism – that is essential for generating and sustaining cooperation within groups. It may be more prudent to suppress egoism by harnessing reciprocity, the better angel of our natures.

Goldfish separating from crowd in fishbowl
Reciprocity could intensify animosity towards outsiders

That said, unless we are cautious, reciprocity can be devilish too. For instance, policy makers ought to be on their guard against the potential harms that reciprocal actions can impose on third parties, and to try to ensure that fostering reciprocity and cooperation within a group does not generate or intensify any animosity that group members may feel towards outsiders. Moreover, one ought to keep an eye on whether some are being obligated to reciprocate due to differential power relationships, which potentially undermines the very notion of a fair exchange, and in relation to negative reciprocity, in order to minimise feelings of injustice and minimise the risk of spiralling retaliation, one ought to ensure that the punishment is accepted generally by all potential partners as befitting of the crime.

Notwithstanding these potential negative implications, reciprocity, if harnessed in the right way, can serve substantively as a force for good. Many of the extraordinary achievements of mankind – including the development of public policy sectors – would not, after all, have been possible without reciprocation and cooperation. We must thus create and sustain the conditions for reciprocity to flourish. A primary condition for reciprocity to flourish is for it to be emphasised in political and policy rhetoric. If we want social structures that support the basic human motivation to reciprocate and hence cooperate, then how they do so ought to be explained clearly. Moreover, the decentralisation of more of the management of public services to local planners, purchasers and providers would be a wise strategy to pursue, partly because securing reciprocal motivations and actions and abating egoistical ones is more difficult the larger the group, partly because this would afford greater local level innovation, which, if good results were shown, could be disseminated cross-regionally, and partly because local level actors will be more in tune with the objectives and priorities of the people they serve. A further general condition for fostering this motivational force is for there to be policy action on reducing the high concentrations of income and wealth within small percentages of the population in many societies. If one wants people to give and take it makes sense to create conditions where they do not feel that others are merely taking.

As already noted, the study of reciprocity is a focus within behavioural economics, and thus we may ask ourselves of the role it plays within behavioural public policy. In fact, it can play many roles. It is, for instance, a potentially powerful tool for the effective framing of behavioural change messages. But reciprocity may be embraced and used whichever conceptual behavioural public policy framework one prefers and is central to a new political economy of behavioural public policy that I have developed. The framework calls for conditions to be created that nurture reciprocal behaviours, which, if carefully designed, will help people to flourish in both meeting the predetermined broadly defined objectives of our public sector services and in relation to each person’s privately held goals, where each may find fulfilment in any way they wish. In any way they wish, that is, so long as they are not imposing harms on others. The second arm of this framework is that any harms that are consequent on behaviourally-informed actions are potentially fair game for regulatory control. So, with reciprocity as a basic motivational force in mind, let us promote flourishing and curtail harms: for me, that is how to frame behavioural public policy.

 

Adam Oliver’s book, Reciprocity and the Art of Behavioural Public Policy, published by Cambridge University Press, is available for order now: https://www.cambridge.org/core/books/reciprocity-and-the-art-of-behavioural-public-policy/2278177688EB216622F1A3DB28702223