ECONOMIC SYSTEMS

An Anthropological Perspective

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Bartering

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Are All Humans Driven by a Profit Motive to Accumulate?

How many would ask your boss for a salary cut?

Who aspires to earn less in 5

years than you do now? Which of your possessions are

you willing to give up?

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The Capitalist Market Economy

Assumptions: The world is a commodity Human material wants are

unlimited The means to acquire these wants

limited People economize – make rational

choices among alternatives to maximize individual profit

We allocate scarce resources to increase material well-being

New car? Send child to college? Vacation?

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FORMALIST ECONOMICS

The Capitalist Market Economy Maximization Free Market – Law of Supply & Demand

(“Invisible Hand”) Labor is a Commodity Mechanized Technology (“efficiency”) Rationality

Capitalism Requires Accumulation Inequality is Inherent

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The Big Assumption:

Formalist Economics can be applied to ANY society

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Can Formalist Economics be Applied to Understand

Non-Capitalist Societies?

How well can we understand behavior in other cultures as maximizing or based on profit motive?

Some cultures maximize social realtions !Kung – Ethic of Reciprocity

Some cultures maximize Prestige Melanesia – Big Man gives away wealth Kwakiutl – Potlatch

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Karl Polanyi, Substantivist: 3 Systems of Exchange

Reciprocity Generalized Reciprocity (!Kung, Bands) Balanced Reciprocity (Trobriand Kula,

Tribes) Negative Reciprocity (Gambling, theft)

Redistribution (Kwakiutl, Chiefdoms)

Market Principle (U.S., States) Price based on supply & demand

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All forms may be present: U.S. generalized reciprocity – U.S. balanced reciprocity – U.S. redistribution –

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Non-Capitalist Economies Tiv Spheres of Exchange (Nigeria)

Prestige can be a scarce good Prestige is the basis of an elaborate

economic institution that has little to do with subsistence

Multicentric economy: exclusive spheres of exchange marked by different moral values

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WIVES

PRESTIGE

SUBSITENCE

WIVES – Rights in Wives, Brass Rods = Special Purpose Money

PRESTIGE – Exchange at ceremonies: Slaves, cattle, ritual office, Medicine, Magic, Brass Rods = General Purpose Money within the sphere; Do not enter market sphere

SUBSISTENCE – barter

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Wives Sphere

Marriage: Sister exchange The only “price” for a woman is

another woman Ward-sharing groups; exchange

in women lags in time Brass Rods or Cattle =

Ernest Payment during lag Bridewealth is paid with

prestige goods, brass rods

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Rationale: Invest to convert subsistence goods into prestige goods & prestige goods into wives

CONVEYENCE: Exchange within a sphere (morally neutral)

CONVERSION: Exchange between spheres (moral quality) The Ultimate Maximization

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MONEY

MEANS OF EXCHANGE: Use to purchase goods

MODE OF PAYMENT: Use to pay debts

STANDARD OF VALUE: Can compare value of goods

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If money serves all 3 purposes, it is GENERAL PURPOSE MONEY

If money serves only 1 or 2 of the purposes, it is SPECIAL PURPOSE MONEY

Do we have special purpose money?

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If money serves all 3 purposes, it is GENERAL PURPOSE MONEY

If money serves only 1 or 2 of the purposes, it is SPECIAL PURPOSE MONEY

Do we have special purpose money?Meal ticketCopy cardBus token

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Which did the Tiv have?

Brass Rods = GENERAL PURPOSE MONEY WITHIN the Prestige Sphere

Brass Rods = SPECIAL PURPOSE MONEY ONLY in the Wives Sphere

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Change The British Colonial System

introduced General Purpose Money This broke down distinctions

between the three spheres The British imposed taxes &

outlawed sister exchange The Tiv paid for wives in money,

thus converting down The price of bridewealth soared Wealth differences increased Debts increased

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Trobriand Kula Ring

The Trobrianders maximize prestigeKula is a formalized exchange system, distinct from subsistence activities

Life-long trading partnersThe more partners, the more prestige

Each shell necklace or armband has a known history, acquires fame

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Trobriand Kula Ring

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Magical rituals for safe trip, to make trading partner generous Sea reefs, giant octopii, flying

witches The danger makes kula trade seem

irrational Taboos on sex

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Complex Kula Rules

Only trading partners exchange prestige items

They are given to trading partners with great ceremony

Host is obligated to trade & offer hospitality to guest

Subsidiary trade takes place among non-partners These are practical items with no

ritual value

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The Kula gifts are not kept—prestige is gained by giving it away in ritual gesture

There is expectation that items of comparable value will be exchanged within a reasonable time

This is an example of BALANCED RECIPROCITY

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Kwakiutl Potlatch

“Potlatch” means “gift”

Prestige is acquired by giving valuable gifts away

Each village has a hierarchy of offices marked by titles, crests, the rights to masks, songs, & symbols used in ceremonies

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Potlatch Is held to validate hereditary

titles & social rank Totem poles symbolize the

ancestral titles claimed by chiefs of the village

Rank & prestige are scarce commodities

Amount of goods given away reveals prestige

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How to Potlatch

The host traces his line of descent Recounts the ancestral origin of

the title he seeks Demonstrates the validity of his

claim to the title, privileges, masks, etc.

Until publicly validated, no right to titles Like notarizing a document

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The Potlatch Unit

The extended family of the chiefAssist in preparation &

assembling goods for distribution

Convince others to give blankets, carved cedar chests, barrels of oil, boats, etc.

The group may spend years accumulating enough goods

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Formal Ritual With Complex Rules

Invite guests from other villages Guests are seated in rank order Speech making Display of crests, masks,

performance of dances Presentation of title Redistribution of gifts, according

to rank order of guests

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Elaborate System of Conversion Among Economic Spheres

Coppers: (prestige item) Each is named, has a history

that is publicly known If coppers are given

away in ceremony,value is now in the prestige sphere

1875

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Conversion

The ideal is the conversion of goods into a higher, prestige sphere

Introduction of a cash economy intensified the potlatch Caused inflation

Introduction of trade goods led to rivalry potlatches

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Rivalry Potlatch

Where two potential heirs claimed the same title

Each rival held a potlatch, invited the same guests, denied or belittled the claims of his rival

To show economic superiority, destroyed valuable goods

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Aim: to convert goods into coppers, acquire the ultimate prestige of destroying the copper Break copper into pieces &

throw into sea 1880s Canadian law prohibited

potlatch & police confiscated the coppers

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Potlatch is an example of REDISTRIBUTION