On the alleged death of homo economicus

If I am to take Nick Hanauer’s[1] advice and kill off homo economicus then what I fear I’ll be left with is – all that someone of a liberal-humanist bent can ask, I suppose – homo impotenticus. A person unpurposed: because I am not alone, because I am not reified individual, because I am part of a social contract. Because government and business do not want him or her (homo economicus, that is) dead. Modern democracy dis-empowers homo sapiens in favour of his economic cousin.

Hanauer says of the business world he works in:

‘the world I inhabit, the world of business and economics,’ [is] ‘somewhat “morally challenged.” To be clear, contemporary American business and economic culture does have a moral framework: neoliberalism. But I think it is safe to say that this framework is dependably orthogonal to the last 50,000 years of moral norms and traditions.’

Furthermore,

‘I believe that these corrosive moral claims’ [re modern neo-liberal business and its behaviours/practices] derive from a fundamentally flawed understanding of how market capitalism works, grounded in the dubious assumption that human beings are “homo economicus”:  perfectly selfish, perfectly rational, and relentlessly self-maximizing. It is this behavioral model upon which all the other models of orthodox economics are built. And it is nonsense[2].’

Of course, it is nonsense – but it is not the kind of nonsense Hanauer and an apologist stance for capitalism would have us accept. Business (and, I would argue, democratic governments, all of which appear these days in some form of hock to business interests) operates as if homo economicus exists; by virtue of this belief, the policies that business and government as business implement make of homo economicus a working (animated) entity. If one of the capitalists can claim that Homo economicus may not exist as human but certainly a zombie form is extant. If business accepts the passing of homo economicus then business must change its business models re endless pointless consumption, the economies of scale and eternal economic growth. As if…

[1] Nick Hanauer is a Seattle-based serial entrepreneur, venture capitalist, author, and activist with a knack for identifying and building transformative business models. Twitter: @NickHanauer  See http://evonomics.com/how-to-destroy-neoliberalism-kill-homo-economicus/

[2] Here is Hanauer’s reasoning: ‘The last 40 years of research across multiple scientific disciplines has proven, with certainty, that homo economicus does not exist. Outside of economic models, this is simply not how real humans behave. Rather, Homo sapiens have evolved to be other-regarding, reciprocal, heuristic, and intuitive moral creatures. We can be selfish, yes—even cruel. But it is our highly evolved prosocial nature—our innate facility for cooperation, not competition—that has enabled our species to dominate the planet, and to build such an extraordinary—and extraordinarily complex—quality of life. Pro-sociality is our economic super power.’