In trying to explain belief economics, I was reminded of a seasonal story: the tale of the utterly brilliant economists of Easter Island. Despite the historical inaccuracies, it nonetheless makes a startling case.
Belief Economics is the study of why people get up in the morning, and how their aspirations influence the economy. Some time ago, around 1300 AD a few hundred years after the Polynesians first occupied of Easter Island, a young fellow, Kauʻionālani, would get up in the morning because he was hungry and needed to fill his tummy. He would jog down to the beach, past the hare paenga, the posh houses of the village elders, and then past the moai, the famous statues themselves. He would look up with awe at their solemn countenances surveying the eternity of the Pacific Ocean around them. Then he’d hop into a wooden canoe, and ride the surf for an hour or so to bring in a couple of nanue fish for his daily fare.
One day he met, U’ilani, who was so fecund that he scarcely needed look at her and she was with child. The olive-skinned beauty would bear him seven children, seven hungry mouths to feed. So he was motivated to work a little harder – sometimes joining the dolphin hunt, other days trekking inland to the farmlands where he tended crops of taro and sweet potato, which U’ilani grilled with the fish and wild thyme on a simple wood stove.
As the embers of the fire faded, he would sip cane juice or palm-sap wine and tell tales to the little ones of Hotu Matu’a and the deity Make-make. But the conversation would turn to the great men of the day and those powerful dynasties of chieftains who provided for all – the Pohakus, the Kealas or the Kalamas: “One day,” he said to them, the red light from the hearth flickering in the eager eyes of his brood (except for Siaki the youngest, who already slept soundly on his mother’s breast), “you will also be able to hew rocks from Mr Pohaku’s quarry and, with Mr No’eau’s chisels, carve the features of those great men onto the stone. You will cut logs from Mr Kalama’s forest, and slide the statues down from the mountainside to the shore with the help of Mr Keala’s logistics business. And you will be able to heave up the rocks onto their resting place on the shore.
Thus primed by their father and fired with ambition, the lads of Kauʻionālani grew up into fine young men and for many generations were celebrated for the brilliance of the statues that bore their signatures.
Easter Island had a remarkably efficient education system. The technologies of stone cutting and tree felling were of vital importance for ensuring that more and more statues could be built for as little work as possible. So the Islanders determined to reinvest significant funds into technology schools. The benevolent Mr Kalama and the far-sighted Mr Keala endowed schools where young scientists and technicians could focus on devising better axes, better conveyance systems, and smarter techniques for their deployment. Mr Kalama, who owned the forests, being so successful in business, was hired by the government to be education advisor. He said (this is passed down by oral tradition of the Islanders): “My dream is that one day all our children will study technology for six hours a day. Who needs philosophy and thinkers; who needs myths and deities? We know what we want and why we want it: Statues, stupid. The only thing our children need to study is how. Technology and science are all that matter.”
Easter Island became one of the most technologically brilliant (and god-fearing) nations of the Pacific Ocean. And thus it constructed its own fate. As the years went by, the statues got bigger and bigger, as the chieftains vied with each other to vaunt their status and their proximity to the gods. One day the last tree was felled from the lands of the wealthy Mr Kalama, the weather changed, the crops failed, the last boat sank, and the population was trapped: it could not feed itself and yet it could not flee the island. And all the while the ancestors and watched impassively from their thrones on the beach.
None of this is that remarkable – many societies have plundered their economic surplus on icons, and will continue to. Other societies have suffered even more ignominious fates. But what was special about Easter Island was the brilliance of their economists. So brilliant were the economists that the “Conch Prize” was established to reward them. Thus Dr Ikale was celebrated for his examination of the relationship between the number of young men employed in Mr Pohaku’s mines and the number of pink cowry shells in circulation (these being the currency of the day); Professor Tekea was crowned for his theory of efficient utilisation of the Kalama timber stocks; Professor Anama was recognised for his penetrating insights into economic growth and barriers to inter-territory trade. Another received the Conch Prize for his fish market efficiency theory; yet another devised a ground-breaking formula for calculating the value of options on obsidian, the stone used for making cutting tools with. These were all vital, brilliant studies, essential for understanding the economy of the day.
Several of those brilliant economists of Easter Island are remembered even now, deified and commemorated in stone, still watching, waiting for the market to turn.
A few lesser known economists survived on the peripheries of academia, making a meagre living from part-time work gathering tern eggs or binding rope. Their names are not recorded, just scraps of their work remain, etched into bark or, in later years, scratched onto stone slabs. One sought to analyse the economic return to society of a marginal increase in statue size, but the work was never completed. Another began a treatise on the impact of ego on economic decision-making among the chieftain classes. Archaeologists recently found notes on the correlation between resource exploitation and childhood story-telling. Unfortunately the conclusion was cracked and illegible.
With the benefits of hindsight it is odd that those who examined the boundary conditions and psychological underpinnings of the economic system received little attention, and were often unable to complete their work. Those that squinted into the narrow, internal mechanics of the economic system were decorated with garlands and held in great esteem.
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Sources: Relevant sections from Collapse by Jared Diamond; Wikipedia.
