The Evolution of Extreme Cooperation via Shared Dysphoric Experiences

Willingness to lay down one’s life for a group of non-kin, well documented in the
historical and ethnographic records, represents an evolutionary puzzle. Here we
present a novel explanation for the willingness to fight and die for a group, combining evolutionary theorizing with empirical evidence from real-world human groups. Building on research in social psychology, we develop a mathematical model showing how conditioning cooperation on previous shared experience can allow extreme (i.e., life-threatening) pro-social behavior to evolve. The model generates a series of predictions that we then test empirically in a range of special sample populations (including military veterans, college fraternity/sorority members, football fans, martial arts practitioners, and twins). Our results show that sharing painful experiences produces “identity fusion” – a visceral sense of oneness – more so even than bonds of kinship, in turn motivating extreme pro-group behavior, including willingness to fight and die for the group. These findings have theoretical and practical relevance. Theoretically, our results speak to the origins of human cooperation, as we offer an explanation of extremely costly actions left unexplained by existing models.
Practically, our account of how shared dysphoric experiences produce identity fusion, which produces a willingness to fight and die for a non-kin group, helps us better understand such pressing social issues as suicide terrorism, holy wars, sectarian violence, gang-related violence, and other forms of intergroup conflict.

Size Matters: The Effect of the Size of Ethnic Groups on Development

The share of ethnic groups is one of the most important features of African politics. It affects civil wars, representation in government positions, distributive and allocative policies. In this paper we use the partition of ethnic groups as a natural experiment in order to estimate the effect of the share of these ethnic groups on development. We show that larger groups have an advantage in terms of development and that the partition in itself does not matter for development. This result is explained by the fact that the partition matters only when the resulting groups are relatively small, since their lack of political representation may weaken support for institutions, may bias policies and the provision of ethnic/regional public goods.

What Moved Share Prices in the Nineteenth-Century London Stock Market?

Using a new weekly blue-chip index, this paper investigates the causes of stock price movements on the London market between 1823 and 1870. We find that economic fundamentals explain about 15 per cent of weekly and 34 per cent of monthly variation in share prices. Contemporary press reporting from the London Stock Exchange is used to ascertain what market participants thought were causing the largest movements on the market. The vast majority of large movements were attributed by the press to geopolitical, monetary, railway-sector, and financial-crisis news. Investigating the stock price changes on an independent list of events reaffirms these findings, suggesting that the most important specific events which moved markets were wars involving European powers.

A Sustainable Century? Genuine Savings in developing and developed countries, 1900-2000

This chapter traces the long-run development of Genuine Savings (GS) using a panel of eleven countries during the twentieth century. This panel covers a number of developed countries (Great Britain, Germany, Switzerland, France, the US, and Australia) as well as a set of resource-abundant countries in Latin America (Argentina, Brazil, Chile, Colombia, and Mexico). These countries represent approximately 50 percent of the world’s output in terms of Gross Domestic Product (GDP) by 1950, and include large economies and small open economies, and resource-rich and resource-scarce countries, thus allowing us to compare their historical experiences. Components of GS considered include physical and human capital as well as resource extraction and pollution damages. Generally, we find evidence of positive GS over the course of the twentieth century, although the two World Wars and the Great Depression left considerable marks. Also, we found striking differences between Latin American and developed countries when Total Factor Productivity (TFP) is included; this could be a signal of natural resource curse or technological gaps unnoticed in previous works.