Tuesday, January 7, 2014

A Game of Institutions Book 4: Let Us Prey

This week, friend of EE Anthony Gill muscles in on the Roberts/Munger hit parade and talks Holy Turkey on Econtalk. It's one of the better episodes of all time, but that might be my biases talking, interested as I am in the public choice analysis of collusion between the estates and of using economics to talk about stuff not ordinarily associated with the miraculous world of simple commerce. And narrowly, Tony's chat with Russ is timely for your humble blogviator (@Spivonomist has as of this moment 74 followers and 1276 tweets for an index quotient of 0.05799373), since I've been sort of struggling with how to motivate the next chapter in the S&T saga.

Recall from last time, one institutional arrangement that's at least theoretically possible is characterized by a cooperative game with asymmetrical payoffs. That's a jargon-laden way of saying that everyone's better off under the arrangement, but some are better off than others. But it's not coercive. Imagine a Manor Farm where Snowball can actually leave without being turned into delicious rashers of crispy bacon. Well, where can we find examples of this out there in the real, wide world?

It strikes me having listened to Tony disserting at length that the rich history of orthodoxy and apostasy in Western religions has an awful lot to offer in this node. Consider that on its own, the Church can't be coercive. It takes collusion with the state to transform The Cross into a truncheon. Can you even imagine the horrors of the Spanish Inquisition happening without at least the tacit approval of the sovereign? It's worth noting that one of the few Continental refuges for the most unexpected of all inquisitions was Lithuania, the last European nation to be converted to Christianity (and even then only tepidly), a place where the Body of Christ walks with wooden legs and sits in pensive repose on waterlogged stumps. Seriously, you guys: Kryžių kalnas is something else, and the crosses there survived numerous attempts by Soviet authorities to remove them. It is one of the most bizarre oddities of Europe, if not the whole wide world. I have to avoid thinking about it too carefully or my head goes all swimmy.

But think about the rise of New World religions. Exit options provided just enough Tiebout competition to allow for some serious apostasy. That big "clunk" you heard in the early 16th century was a double-clutch gear shift as the First Estate flopped from predatory monopolistic coercion to something more closely approximating a modern corporate interest.

But here's the interesting thing about the kayfabe of religion: part of the aesthetic is asceticism. Men of the Cloth (and nuns in particular) were, but for the rarefied Vatican elite, generally of modest means. Of course, rent need not be material to be valuable. Risk pooling and reduction is mighty valuable under Mathusian conditions. As is positional station cachet. Respect of the community is tough to measure in bars of gold. At any rate, the appearance of the poor pastor suggests to me to be a nod to the apostasy threat when congregants observe the clergy accumulating treasure. "Why should I keep sending my silver to Italy when this Calvin guy is bidding lower?" The Mennonite sects here in the States seem to have this bit figured out exceptionally well. But it strikes me that the transition from total Catholic hegemony to perfect Quaker equality is the cooperative-asymmetric game rather than the coercive-symmetrical game. And the existence of the mega-church and the television evangelist suggests to me that it can be a durable game. If congregants believe they're getting something out of the deal (eternal salvation), they should be willing to put up with some wealth inequality. It's not all that different than buying tickets for a basketball game or a personal computer.


Anyway, let's get back to Lithuania. Just a quick visit, I promise. Even before Soviet times, Catholicism was heavily flavored. These days, there's a short list of state-sanctioned churches, mostly as a reaction to some of the more aggressive proselytizing in the wake of 13 January, 1991. The quick and dirty story is that missionaries descended on the newly liberated republic, tracts in hands and sermons on lips with the goal of obtaining all those sweet, sweet new converts. Missionaries weren't banned in the sense that they couldn't set up shop, but neither were they afforded special tax and property rights status like the established religions. My personal brush with this was a spot of trouble with getting married. I wasn't baptized in an officially-recognized sect, so the officious local priest gave us some (easily overcome, thankfully) grief about it. At any rate, it's too easy to reason from an outcome and say that Lithuania is trying to protect incumbent sects, to provide rents for the Catholic Church. Not in this case. Even at the height of its influence (not necessarily counting the Livonian occupation), the Vatican didn't have the same grip on Vilnius that it did on Paris. Instead, consider the possibility that the median Lithuanian voter is looking to cut hysteresis loss, to quell a nuisance. Ordinary practical secularism has been their daily BATNA since they first set up shop in the Land of Rain (the Lithuanian word for "Lithuania" is Lietuva, and the word for "rain" is lietus. Also, it rains for like half the year, so even if it's not good etymology, it's good enough for me). So if our doughty pikesmen of the Baltic find the asymmetries of religious institutions offensive, it's never bothered them before to shrug it off. Why should now be any different?

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Do you have suggestions on where we could find more examples of this phenomenon?