PDF Ebook The Benefits of Cooperation
There is an idea, extremely common among social contract theorists, that the primary function of social institutions is to secure some form of cooperative benefit. If individuals simply seek to satisfy their own preferences in a narrowly instrumental fashion, they will find themselves embroiled in collective action problems – interactions with an outcome that is worse for everyone involved than some other possible outcome. Thus they have reason to accept some form of constraint over their conduct, in order to achieve this superior, but out-of-equilibrium outcome. A social institution can be defined as a set of norms that codify these constraints. 1 Simplifying somewhat, one can then say that social institutions exist in order to secure gains in Pareto-efficiency. This theory is one that I take to be in large measure correct. 2 My concern, however, is that it tends to be formulated at too high a level of abstraction. By focusing on the structure of the interaction – a structure that is often specified simply in terms of the utility functions of participants – the theory tends to abstract away completely the mechanism through which social benefits are produced. Thus major philosophical writers working in the social contract tradition, such as David Gauthier and John Rawls, make no attempt at all to specify how cooperation improves the human condition. Rawls, for example, states simply that “social cooperation makes possible a better life for all than any would have if each were to live solely by his own efforts,” without saying how. 3 Gauthier focuses entirely upon the role of institutional constraints in resolving “prisoner’s dilemmas,” but with no systematic analysis of what people are typically trying to accomplish when they get into these dilemmas.
This theory is one that I take to be in large measure correct. 2 My concern, however, is that it tends to be formulated at too high a level of abstraction. By focusing on the structure of the interaction – a structure that is often specified simply in terms of the utility functions of participants – the theory tends to abstract away completely the mechanism through which social benefits are produced. Thus major philosophical writers working in the social contract tradition, such as David Gauthier and John Rawls, make no attempt at all to specify how cooperation improves the human condition. Rawls, for example, states simply that “social cooperation makes possible a better life for all than any would have if each were to live solely by his own efforts,” without saying how. 3 Gauthier focuses entirely upon the role of institutional constraints in resolving “prisoner’s dilemmas,” but with no systematic analysis of what people are typically trying to accomplish when they get into these dilemmas.
Social scientists interested in the subject of cooperation have not achieved much greater clarity. One often hears talk of “social capital,” for example, as a generic resource, a fund of trust and solidarity that individuals can draw upon in order to overcome collective action problems without having to institute a formal system of sanctions. 4 This is often accompanied by some specific empirical examples of cooperative arrangements that rely upon this sort of trust, but very seldom is there any discussion of the type of cooperative projects that social capital gets used for, or what sort of benefits cooperation can produce. When a more abstract mechanism does get mentioned, the discussion tends to focus upon the best-known instance of such, which is the gain from trade achieved through market exchange (or the division of labor). Thus social capital is often characterized as a resource that is used to reduce transaction costs, in order to facilitate exchange and reduce deadweight losses. 5 While this is no doubt true, it represents only one of the ways that social capital can be used.
In this paper, I would like to correct this deficit, by specifying five different mechanisms of cooperative benefit. I refer to them as mechanisms, and not simply as “social goods,” because they represent different ways in which individuals can help each other to achieve each others’ objectives, whatever those objectives may be. 6 While each of these mechanisms is, on its own, well known, there has been no systematic attempt to classify them, or to draw out the implications that such a classification has for social contract theory, or for political philosophy more generally.
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