The Invisible Hand—-Reading Response for “Competition and Cooperation: The Wisdom to Know When”

“Competition and Cooperation: The Wisdom to Know When” is a research article written by Roberta Wiig Berg, which focused on explicating participants’ decision-making process during the experiment, red-blue exercise, by studying how they chose competitive or cooperative behaviors according to various situations with the means of communication and deceit. “The author’s narrative method is easy to follow, well-organized and straightforward”. (Mmravi. 2018, ¶ 3) According to the author’s opinion, “When we encounter unfamiliar or threatening situations, we automatically respond defensively, engaging in competitive rather than cooperative behavior.” (Berg, 2010, ¶ 1), he was suggesting that competition is a part of human basic instinct by emphasizing the word, “automatically”. This hypothesis raises a more intensely discussed question: Is human nature “good”, attempting to cooperate, or is human nature “evil”, striving for self-interest through competition?

In my opinion, human nature couldn’t simply be concluded by being good or evil. The universal fact is that humans were born to be self-interested animals. The “invisible hand” of self-interest drives us to attain benefits through a variety of ways. However, after instillation of ethics, morality and culture by teachers and parents, we gradually understand that self-control and cooperation can help us achieve bigger success more efficiently with mutual gain for both sides. Thus, we learn how to maneuver different strategies in order to cope with different situations, which in turn leads to the greatest utility possible.

First of all, humans congenitally pursue self-interest by using various means, which could also be applied to other organisms. The most classical example would be Bateson’s argument about endosymbiosis: “that one bacterium took up residence inside another in a way that was mutually beneficial. In effect, the form of all the cells in higher organisms goes back to an event of co-operation, combining, not competing.” (Bateson, 2016, ¶ 9) When organisms are placed in a harsh living environment with limited abilities and resources, the “invisible hand” pushes them together to cooperate because the only way to survive is integrating resources to maximize utility. During the warring states period in ancient China (453-221 BC), the smaller and weaker states tended to cooperate with each other by forming alliances. Therefore, when the strongest state attacked one of the weaker states, other weaker states would provide military force to support the attacked state. None of the weaker states wanted their allies to be destroyed because if the strongest states conquered another state, its power would be greater and greater, which in turn stored up security problem for the weaker states in the future. In this case, the benevolence of helping other states indirectly achieved the pursuit of self-interest.

On the other hand, the pursuit of self-interest in modern society has a totally different presentation. With advance of technology and increasing living standard, we, as humans of modern civilization, have the luck to enjoy the benefits brought by industrial revolution and information age. Every morning, when we open the tap, clean water continuously flows out. The stores are filled with diverse brands of food, clothes, and electrical appliances from all around the world. As we no longer need to worry about the suffer of hunger, thirst and insecurity that were the major themes of primitive time, we also become more egocentric and “independent”. The “Invisible Hand” keeps us away from each other, fostering a sense of distance among individuals. The modern society values property rights, individual achievements, and personal credit, which shows a favor of preserving self-right rather than promoting collective utility. Even if “we initially wish to be cooperative, at the first sign of challenge or threat to our strongly held beliefs or to our perceived images of ourselves, we automatically switch into defensive communication and action mode” (Berg, 2010, ¶ 20) because cooperation is no longer a must to help us survive. It’s hard to let down our guard because human society is too complicated to trust others. Without sincere communication and mutual trust, the interpersonal relations become more and more subtle, capricious and intricate.

Besides human nature, acquired education also helps us to pursue self-interest through self-control and cooperation. The most famous one is called delayed gratification. When a sweet is placed in front of a kid, he will definitely eat it without any hesitation. Then, an adult tells the kid that if he didn’t eat the first candy, and waited until he put the tenth candy on the table, the kid could get all the candies. However, the kid has to wait for a long period of time in order to get 10 candies. The outcome of this psychological experiment is surprising, since a few kids did wait until the end to eat candies. They controlled their basic instincts because they knew if they obeyed the rules, they would be benefited much more than they didn’t. Later researches also demonstrated that those kids had higher grades, better social skills and lower probability of obesity. By sacrificing the present enjoyment, people could attain more self-interest in the future. This is also true for the society. By decreasing the production of present goods and services, the society devotes more resources to capital good (machines, equipment, infrastructure), which shifts the production possibility frontier rightward, attaining a higher amount of production in the future.

tutor2u-production-possibility-frontiers-9-638

Through cooperation in markets, both buyers and sellers get more self-interest. Nowadays, the trend of different brands to collaborate with each other by integrating diverse fashion elements into one product is extremely popular. For example, Puma cooperates with Mac to produce sneakers with the shades of lip sticks. Nike cooperates with Off- white to produce hoodies with classical white stripes (symbol of Off-white) on the back, etc. The advantage of buying this kind of product is that consumers could get fashion elements of expensive brands with a lower price. For the sellers, the creative elements and limited quantity supplied of the products stimulate the purchasing desire and boost revenue. Both sides benefit from the “Invisible Hand” of self-interest.

The pursuit of self-interest is the forever theme of human survival. However, the way we choose to attain it is dependent on various situations and contexts, which is not constrained to competition. The best outcome is that we are pushed by the “Invisible Hand” and gain mutual benefits during the process.

 

Images sources:

https://www.google.com/search?biw=1280&bih=612&tbm=isch&sa=1&ei=EQjEW93xDduy0PEPpaS4kA0&q=the+invisible+hand&oq=the+invisible+hand&gs_l=img.3..0l10.440912.445826.0.446022.18.10.0.8.8.0.142.799.9j1.10.0….0…1c.1.64.img..0.18.850…35i39k1j0i67k1.0.6FDkpv9r47w#imgrc=6x3W1XblA7RJmM:

https://www.google.com/search?biw=1280&bih=612&tbm=isch&sa=1&ei=BAjEW5qWM_jG0PEPwp6SsAM&q=production+possibility+frontier+shift+outwards&oq=production+possibility+frontier+shift+&gs_l=img.1.2.0i30k1j0i8i30k1j0i24k1.8396.9532.0.10895.7.7.0.0.0.0.119.558.5j2.7.0….0…1c.1.64.img..0.7.555…0.0.dYkf7olnc28#imgrc=2fRaZ5ELVpZFDM:

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