A Fine Theorem

The Industrial and Neolithic Revolutions are surely the two fundamental transitions in the economic history of mankind. The Neolithic involved permanent settlement of previously nomadic, or at best partially foraging, small bands. At least seven independent times, bands somewhere in the world adopted settled agriculture. The new settlements tended to see an increase in inequality, the beginning of privately held property, a number of new customs and social structures, and, most importantly, an absolute decrease in welfare as measured in terms of average height and an absolute increase in the length and toil of working life. Of course, in the long run, settlement led to cities which led to the great inventions that eventually pushed mankind past the Malthusian bounds into our wealthy present, but surely no nomad of ten thousand years ago could have projected that outcome.

Now this must sound strange to any economist, as we can’t help but think in terms of rational choice. Why would any band choose to settle when, as far as we can tell, settling made them worse off? There are only three types of answers compatible with rational choice: either the environment changed such that the nomads who adopted settlement would have been even worse off had they remained nomadic, settlement was a Pareto-dominated equilibrium, or our assumption that the nomads were maximizing something correlated with height is wrong. All might be possible: early 20th century scholars ascribed the initial move to settlement to humans being forced onto oases in the drying post-Ice Age Middle East, evolutionary game theorists are well aware that fitness competitions can generate inefficient Prisoner’s Dilemmas, and humans surely care about reproductive success more than they care about food intake per se.

So how can we separate these potential explanations, or provide greater clarity as to the underlying Neolithic transition mechanism? Two relatively new papers, Andrea Matranga’s “Climate-Driven Technical Change“, and Kim Sterelny’s Optimizing Engines: Rational Choice in the Neolithic”, discuss intriguing theories about what may have happened in the Neolithic.

Matranga writes a simple Malthusian model. The benefit of being nomadic is that you can move to places with better food supply. The benefit of being sedentary is that you use storage technology to insure yourself against lean times, even if that insurance comes at the cost of lower food intake overall. Nomadism, then, is better than settling when there are lots of nearby areas with uncorrelated food availability shocks (since otherwise why bother to move?) or when the potential shocks you might face across the whole area you travel are not that severe (in which case why bother to store food?). If fertility depends on constant access to food, then for Malthusian reasons the settled populations who store food will grow until everyone is just at subsistence, whereas the nomadic populations will eat a surplus during times when food is abundant.

It turns out that global “seasonality” – or the difference across the year in terms of temperature and rainfall – was extraordinarily high right around the time agriculture first popped up in the Fertile Crescent. Matranga uses some standard climatic datasets to show that six of the seven independent inventions of agriculture appear to have happened soon after increases in seasonality in their respective regions. This is driven by an increase in seasonality and not just an increase in rainfall or heat: agriculture appears in the cold Andes and in the hot Mideast and in the moderate Chinese heartland. Further, adoption of settlement once your neighbors are farming is most common when you live on relatively flat ground, with little opportunity to change elevation to pursue food sources as seasonality increases. Biological evidence (using something called “Harris lines” on your bones) appears to support to idea that nomads were both better fed yet more subject to seasonal shocks than settled peoples.

What’s nice is that Matranga’s hypothesis is consistent with agriculture appearing many times independently. Any thesis that relies on unique features of the immediate post-Ice Age – such as the decline in megafauna like the Woolly Mammoth due to increasing population, or the oasis theory – will have a tough time explaining the adoption of agriculture in regions like the Andes or China thousands of years after it appeared in the Fertile Crescent. Alain Testart and colleagues in the anthropology literature have made similar claims about the intersection of storage technology and seasonality being important for the gradual shift from nomadism to partial foraging to agriculture, but the Malthusian model and the empirical identification in Matranga will be much more comfortable for an economist reader.

Sterelny, writing in the journal Philosophy of Science, argues that rational choice is a useful framework to explain not only why backbreaking, calorie-reducing agriculture was adopted, but also why settled societies appeared willing to tolerate inequality which was much less common in nomadic bands, and why settled societies exerted so much effort building monuments like Gobekli Tepe, holding feasts, and participating in other seemingly wasteful activity.

Why might inequality have arisen? Settlements need to be defended from thieves, as they contain stored food. Hence settlement sizes may be larger than the size of nomadic bands. Standard repeated games with imperfect monitoring tell us that when repeated interactions become less common, cooperation norms become hard to sustain. Hence collective action can only be sustained through mechanisms other than dyadic future punishment; this is especially true if farmers have more private information about effort and productivity than a band of nomadic hunters. The rise of enforceable property rights, as Bowles and his coauthors have argued, is just such a mechanism.

What of wasteful monuments like Gobekli Tepe? Game theoretic deliberate choice provides two explanations for such seeming wastefulness. First, just as animals consume energy in ostentatious displays in order to signal their fitness (as the starving animal has no energy to generate such a display), societies may construct totems and temples in order to signal to potential thieves that they are strong and not worth trifling with. In the case of Gobekli Tepe, this doesn’t appear to be the case, as there isn’t much archaeological evidence of particular violence around the monument. A second game theoretic rationale, then, is commitment by members of a society. As Sterelny puts it, the reason a gang makes a member get a face tattoo is that, even if the member leaves the gang, the tattoo still puts that member at risk of being killed by the gang’s enemies. Hence the tattoo commits the member not to defect. Settlements around Gobekli Tepe may have contributed to its building in order to commit their members to a set of norms that the monument embodied, and hence permit trade and knowledge transfer within this in-group. I would much prefer to see a model of this hypothesis, but the general point doesn’t seem impossible. At least, Sterelny and Matranga together provide a reasonably complete possible explanation, based on rational behavior and nothing more, of the seemingly-strange transition away from nomadism that made our modern life possible.

Kim Sterelny, Optimizing Engines: Rational Choice in the Neolithic?, 2013 working paper. Final version published in the July 2015 issue of Philosophy of Science. Andrea Matranga, “Climate-driven Technical Change: Seasonality and the Invention of Agriculture”, February 2015 working paper, as yet unpublished. No RePEc IDEAS page is available for either paper.