Although the benefits of cooperation are shared equally among all members of the group, the costs are borne privately by each cooperator. The tension between “public goods—private costs” results in what is sometimes known as the Cooperator’s Dilemma. It turns out that a group consisting entirely of rational agents motivated solely by greed and fear is incapable of cooperation. But it is cooperation that underlies the ability of human groups - whether economic organizations, firms and corporations, or political organizations, such as states.
In the years since the publication of The Selfish Gene, lots of work has been done exploring human-specific mechanisms for fostering cooperation. For eg., take the idea of open-ended play. Two individuals play the Prisoner’s Dilemma, knowing that after a single round, they’ll never meet again. Rationality decrees that you defect. What about two rounds? It requires noncooperation for the same reasons the single-round game does - the game defaults to a single-round game where the rational strategy is to defect.
Three rounds? The same. In other words, playing for a known number of rounds biases against cooperation, and the more rational the players, the more they foresee this. Cooperation flourishes when games have an uncertain number of rounds. This produces the shadow of the future, where retribution is possible. Here our reputations precede us and produce a sense of obligation and reciprocity. The Nobel Prize–winning economist Kenneth Arrow has concluded, 'Virtually every commercial transaction has within itself an element of trust, certainly any transaction conducted over a period of time.'
A gene-centric theory is unable to explain such obvious features of human social life as morality, sympathy, and generosity. As the evolutionary biologist David Sloan Wilson explains in Does Altruism Exist?, “. . . group-level functional organization evolves primarily by natural selection between groups.” Groups have multiple-round games and the means to spread news of someone being a jerk. On the other hand, when rational calculations enter into the equation, they tend to undermine ultrasociality. We know them as “nepotism” and “cronyism.”
In Evolution for Everyone, David Sloan Wilson writes that an animal breeder at Purdue University, William Muir, tried to figure out how to make chickens produce the most eggs. He bred two groups of chickens. In both cases, he housed the hens in cages, which is standard practice in the poultry industry. In the first method he did what the 'rank and yank' system does - he picked the hardest working, most productive hen within each cage to breed the next generation of hens and put all of those in one group. The second method involved selecting the most productive cages and using all the hens from those cages to breed the next generation of hens.
Thus same trait (egg productivity) is selected in both cases although in the second group, the whole cage is selected when even the best cage might have some individual duds. The first method caused egg productivity to perversely decline, even though the most productive hens were chosen each and every generation. The second method caused egg productivity to increase 160 percent in six generations.
The first method favoured the nastiest hens who achieved their productivity by suppressing the productivity of other hens. After six generations, Muir had produced a nation of psychopaths, who plucked and murdered each other in their incessant attacks. No wonder egg productivity plummeted! In the second approach, he selected the most productive groups and because they were already a group that worked well together, they included peaceful and cooperative hens.
Why was each superstar the prime egg producing champion in her original group? Because she would aggressively peck subordinates enough to stress them into reduced fertility. Put all these mean champions together, and a group of subordinated chickens, who are now in peace, will outproduce them. This is the circumstance of a genetically influenced trait that, while adaptive on an individual level, emerges as maladaptive when shared by a group. Thie “rank and yank” system is a recipe for disruptive self-serving behaviors.
Even the smartest person can be misled by a false view of human nature. In the long term, the success of the individual is inextricably bound up with the success of the group. Reciprocity is made up of a series of acts each of which is short-run altruistic (benefiting others at a cost to the altruist), but which together typically make every participant better off. The loss of the capacity to feel guilty and the consequent loss of a sense of responsibility may be the biggest problems facing the world today.
Economists have recently discovered that trusting communities, other things being equal, have a measurable economic advantage. This is probably because when individuals cooperate, what economists term “transaction costs” — the costs of the everyday business of life, as well as the costs of commercial transactions — are reduced. Moreover, students of public health find that life expectancy itself is enhanced in more trustful communities. Honesty and trust smoothen the inevitable frictions of social life.
Putting all one's faith in a legal system, complete with courts and law enforcement provides only a partial solution. If we needed legal advice and a police presence to formulate and enforce the simplest agreement, escalating transaction costs would prevent much mutually beneficial cooperation. As Diego Gambetta, a student of trust (and of the Mafia), points out, “Societies which rely heavily on the use of force are likely to be less efficient, more costly, and more unpleasant than those where trust is maintained by other means.” In Bowling Alone, Robert D. Putnam writes:
. . . social capital greases the wheels that allow communities to advance smoothly. Where people are trusting and trustworthy, and where they are subject to repeated interactions with fellow citizens, everyday business and social transactions are less costly. There is no need to spend time and money making sure that others will uphold their end of the arrangement or penalizing them if they don’t. Economists such as Oliver Williamson and political scientists such as Elinor Ostrom have demonstrated how social capital translates into financial capital and resource wealth for businesses and self-governing units.