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Preference modification vs. incentive manipulation as tools of terrorist recruitment: the role of cu


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Title: Preference modification vs. incentive manipulation as tools of terrorist recruitment: the role of cu

Preference modification vs. incentive
manipulation as tools of terrorist recruitment
the role of culture
  • Michael Munger, Departments of
  • Political Science and Economics
  • Duke University
  • Friday, Sept 30, 2005

Problem of Acting as Society
  • Can a group of people who disagree come to a
  • I wantyou wantwhat do we want? COLLECTIVE
  • Even if they do agree, how could they coordinate
    their actions? INFORMATION /
  • Even if they all know what to do, why would they
    do it? FREE RIDER

Information and Coordination
  • The peculiar character of the problem of a
    rational economic order is determined precisely
    by the fact that the knowledge of the
    circumstances of which we must make use never
    exists in concentrated or integrated form but
    solely as the dispersed bits of incomplete and
    frequently contradictory knowledge which all the
    separate individuals possess. The economic
    problem of society is thus not merely a problem
    of how to allocate "given" resourcesif "given"
    is taken to mean given to a single mind which
    deliberately solves the problem set by these
    "data." It is rather a problem of how to secure
    the best use of resources known to any of the
    members of society, for ends whose relative
    importance only these individuals know. Or, to
    put it briefly, it is a problem of the
    utilization of knowledge which is not given to
    anyone in its totality. (F.A. Hayek, 1945, AER).

Problem 2--Commitment Without Enforcement, Can
We Cooperate?
  • Common Knowledge Basis of CooperationWhen I You
    Know That I Know that it is in your interest to
  • Can we account for irrational acts? Suicide
    bombings, sacrifice of a life? Are the bombers
    duped, or confused?
  • We tend to think the state is the only

An Example of Cultural Difference
  • shibboleth--The word is often combined with the
    word cultural.
  • Its general meaning is mean an unspoken but
    shared understanding of something that identifies
    insiders, and distinguishes outsiders because
    they do not share this understanding.

  • Judges 12, 5-7, King James 21st Ed. Bible
  • 5   And the Gileadites seized the passages of
    the Jordan before the Ephraimites and it was so,
    that when those Ephraimites who had escaped said,
    "Let me go over," that the men of Gilead said
    unto him, "Art thou an Ephraimite?" If he said,
  • 6   then said they unto him, "Say now
    Shibboleth." And he said "Sibboleth," for he
    could not frame to pronounce it right. Then they
    took him and slew him at the passages of the
    Jordan and there fell at that time of the
    Ephraimites forty and two thousand.

My Definition of Culture
  • Culture The set of inherited beliefs,
    attitudes, and moral strictures that a people use
    to distinguish outsiders, to understand
    themselves and to communicate with each other.

Culture Is Inherited
  • I have put quotations around the word inherited
    above, not because I am quoting anyone, but
    because the sense of the word is strained.
  • Hair texture, eye color, general buildthose
    sorts of things are inherited. They are
    hard-wired into the genetic structure of humans,
    and children are directly and entirely the
    product of their parents.
  • Culture is obviously not inherited like this. We
    teach it to our children, or they learn it by
    tacit and perhaps unconscious exposure over time.
  • But it makes sense to think of culture as an
    inheritance, or legacy from the past.

Origins Two Concepts
  • Spontaneous Order
  • Intelligent Design
  • Does order imply design? Strange disconnectMany
    people who believe fervently in evolution in
    biology insist on the need for design and control
    in social and economic settings.

The Questions that interest me
  • Are preferences tastes, truly primitive
    (chocolate v. vanilla), or are they culturally
    conditioned or even instrumenal?
  • Are moral beliefs important? Are such beliefs
    best treated as preferences or constraints?
  • Core values relatively fixed, strongly held,
    primitives in terms of preference. Policy
    beliefs not held instrumentally, but as ends in
    themselves. Not irrational to sacrifice for

The Questions that interest me
  • Are ideologies, or shared belief systems about
    right and wrong, the key to understanding moral
    beliefs? In the U.S., lots of research to say no.
    But Islam, or Maoism, may have implications for
    guerrilla movements
  • Are ideologies a kind of spontaneous order, not
    explicitly designed but regular and consistent
    across people and across time? Ideas--like
    viruses? Reproduce, gain resources, but kill
    their host.

Emergence of Culture David Hume has Lunch at
Café Hayek (where orders emerge)
  • Three claims about culture
  • Order requires only regularity and consistency.
    Human beings choose actions based on moral
    conceptions, but also incentives and calculated
    gains that accrue to one action rather than
  • Purposive Action I am going to adopt the
    convention that humans act purposively. (Didnt
    say rationally)
  • People choose actions that they believe (rightly
    or wrongly) will lead to a goal that they
    consider (rightly or wrongly) desirable. These
    conceptions of right and wrong may be Humean
    conventions, not transcendent principles.

Emergence of Culture David Hume has Lunch at
Café Hayek (where orders emerge)
  • Surprising thing is that order can emerge, even
    from disparate and uncoordinated application of
    social convention.
  • Survival value of practices, or fashion, may be
    conscious reason for adoption. But it is a
    predictable, and measurable, consequence.

Order vs. Design Which is Culture?
  • CoyoteEvolution
  • Dachshund / ChihuahuaSurvival
  • DandelionEvolution
  • RoseSurvival
  • Wild TurkeysEvolution
  • Domesticated TurkeysSurvival

Choices Emerge.Do Preferences?
  • Is there some evolutionary process that governs
  • Are human political beliefs getting better over
  • The key difference is the absence of any feedback
    mechanism by which the merits of the emergent
    order might be judged, or subjected to

  • Douglass North makes this point quite forcefully
    Necessary conditions for what economists think
    of as efficiency almost never exist in political
  • Efficient markets are created in the real world
    when competition is strong enough via arbitrage
    and efficient information feedback to approximate
    the Coase zero transaction cost conditions and
    the parties can realize the gains from trade
    inherent in the neo-classical argument.
  • But the informational and institutional
    requirements necessary to achieve such efficient
    markets are stringent. Players must not only have
    objectives but know the correct way to achieve
    them. But how do the players know the correct way
    to achieve their objectives? The instrumental
    rationality answer is that even though the actors
    may initially have diverse and erroneous models,
    the informational feedback process and
    arbitraging actors will correct initially
    incorrect models, punish deviant behavior and
    lead surviving players to correct models.
    (North, 1993).

Will Culture Disappear?
  • Ronald Heiner (1983) argues that as human
    interaction becomes more complex and uncertain,
    successful social institutions must reduce the
    information needed to achieve cooperation among
  • A persons overall behavior may actually be
    improved by restricting flexibility to use
    information or to chose particular actions (p.
  • Mom and Pop hardware store vs. Walmart
  • Farmers Market vs. Piggly Wiggly

The End of History
  • What is the cheapest way of achieving
    cooperation? Formal rules and external
    enforcement, or culture and shame/guilt
    enforcement? Heiner (1983)
  • In general, further evolution toward social
    interdependence will require institutions that
    permit agents to know about successively smaller
    fractions of the larger social environment. That
    is, institutions must evolve which enable each
    agent in the society to know less and less about
    the behavior of other agents and about the
    complex interdependencies generated by their
    interaction (580 emphasis in original).
  • In WalMart world, ideologies would disappear.
    Western, market-based societies with weak parties
    and decentralized democratic institutionsthe end
    of history?

Institutional Design Information.and Commitment
  • Institutions are the humanly devised rules of the
    game that shape and direct human interactions.
  • Institutions reduce uncertainty by shrinking the
    choice set of all of the players. If the rules
    are not formalized, the players may spend too
    much time arguing over the rules, and less time
    competing in productive activities. The actual
    choice of institutions, however, is hard, since
    there are countless ways of restricting bad
    choices. What makes some institutions better
    than others?
  • The Preference Store Metapreference

Step back for a moment.The Fundamental Human
Problem(according to Munger)
  • How can we construct or preserve institutions
    that make individual self-interest not
    inconsistent with the common good?

Two Approaches
  • Madisonian
  • Ambition must be made to counteract ambition
  • Rousseauvian
  • Transform the self, solve the problem of amour
    propre. Inscribe the law on the hearts of men.
    Some preferences are better than others.

The Problem.
  • The nature of exchange gains from trade. Both
    are better off.
  • But only if the exchange takes place
    transactions costs are the ex ante costs of
    negotiating and measuring, and the ex post costs
    of enforcing. Transactions costs can easily
    overwhelm the potential gains from exchange.
  • Institutions and cultural beliefs closely
    related to "common knowledge" problem in game
    theory. Shared meanings, iconography, language,
    symbols. Not just knowledge in the Hayekian
    sense, but also commitment
  • But also may entirely block progress, lock in
    institutions that are not Pareto optimal.

Origins of culture
  • The literature contains two strikingly different
    accounts of the origins of culture, based on two
    very different conceptions of its function.
  • One account is based on transactions cost and
    commitment, while the other rests on the problem
    of excludability and club goods.
  • The two accounts are not mutually exclusive, but
    they do have strikingly different implications
    for our understanding of culture.

I. Commitment Device Real Piety
  • Kreps (1990)
  • Hierarchy
  • Uncertainty
  • Requires an organizing principle as a commitment

The Trust Game
Honor Trust
A 20 B 20
Total 40
Trust B
A ?10 B 30
Total 20
Do Not Honor Trust
Do Not Trust B
A 0 B 0
Total 0
Hierarchy and Strategic Uncertainty
  • It is Bs behavior that is in question somehow B
    must persuade A that there is at least a high
    probability that B will honor As trust if A
    offers it. And there are real gains to be made
    here, so there are significant pressures at work
    to overcome this commitment problem. There are
    two apparently different but mathematically
    indistinguishable ways of solving the problem
  • B could post a bond, or submit to some kind of
    binding third party enforcement that would punish
    him if he violates trust, or
  • B could persuade A that cares so much for A, or
    that B cares so much for his own honor, that he
    will not violate the trust, because it would not
    be in his interest to do so, given Bs self
    interest properly understood.
  • Similar in terms of analytics, but a world of
    difference in terms of practical implications,
    and beliefs.

Hierarchy and Strategic Uncertainty
  • Outside enforcement Hobbes covenants, without
    the sword, are but words
  • Beliefs Rousseau inscribe the law on the
    hearts of men
  • It is common to dismiss this difference, but in
    fact the distinction may be the very heart of the
    matter for the society.
  • Dead weight loss to society has two parts (1)
    The size of the transactions cost sector of the
    society, and (2) Other exchanges precluded by an
    inability to reduce transactions costs to the
    point where those otherwise profitable
    transactions can take place
  • This loss is a direct function of the societys
    set of moral beliefs that condition interactions.
    It will surprise no one at this point that I
    want to call this whole set of moral beliefs and
    conditioning factors for economic and social
    exchange by the vague name I mentioned earlier

II. Club Goods Good Works
  • A standard set-up for the club goods approach is
    Bermans (2003)
  • Imagine a community for which neither government
    nor markets function well. Local public goods
    usually provided by government such as public
    safety, law and order and welfare services are
    poorly provided or absent, while neither public
    nor private sectors efficiently deliver
    education, health services, or insurance. It
    would not be surprising for individuals in such a
    place to band together into communities which
    provide public safety, education, welfare
    services, and other local public goods through
    mutual insurance. (Berman, 2003, p. 2)

Game 1 Prisoners Dilemma
ORDINAL PREFERENCES 1 is good, 4 is bad
Game 1? Prisoners Dilemma with External
Enforcement Defectors are Tortured their
Families Killed
ORDINAL PREFERENCES 1 is good, 4 is bad
Game 1? ? Prisoners Dilemma with External
Enforcement Defectors Feel Really Bad
ORDINAL PREFERENCES 1 is good, 4 is bad
Game 2 Culture War
ORDINAL PREFERENCES 1 is good, 4 is bad
Game 3 U.S. in Iraq1992No Equilibrium.
ORDINAL PREFERENCES 1 is good, 4 is bad
Game 3 U.S. in Iraq2005Side Payments.Be
ORDINAL PREFERENCES 1 is good, 4 is bad
If Club Goods.
  • If participation in terrorist organizations is
    primarily an in-kind payment for access to club
    goods, then policies that reduce the marginal
    value of such club goods will be most effective.
  • A concerted effort to break up social networks,
    in cases where groups with terrorist ties (such
    as Hamas, or IRA) also provide local public goods
    such as schools, police services, etc., and
    replace those organizations with publicly
    provided services, would have an immediate impact
    out of all proportion to the cost.
  • Though the dividing line between police
    services and protection racket may be blurred,
    it is clearly true that the IRA (in Northern
    Ireland) and Hamas (in the Palestinian
    territories or in other parts of the Middle East)
    provided services valued by many local citizens.

If Club Goods.
  • Furthermore, if the problem is an
    incentives-based choice, it becomes clearer why
    medieval punishments have often been employed by
    occupiers fighting resistance groups using terror
  • The rack, drawing-and-quartering, or other public
    displays of savage retribution reduce the value
    of access to local public goods as a matter of
    simple cost-and-benefit calculations.
  • While this observation does not justify the use
    of such tactics, it does explain why they have
    been so commonly observed throughout history.

If Preferences.
  • If, on the other hand, a preference for
    cooperation can be inculcated or selectively
    recruited, then such tactics are likely to
  • If the primary good is psychological solidarity
    with an identifiable group, then public abuse or
    torture may only harden the resolve of those
    committed to cooperation with terror groups.
  • To the extent that abuse of some populations
    solidify in-group vs. out-group psychological
    identifications, attempts to use incentives can
    precipitate the culture war setting described
    earlier in this paper.
  • In that setting, publicly uncooperative behavior
    becomes valued as an end in itself, and even
    apparently Pareto-superior compromises on
    territory may be ruled out. If the preferences
    are primitives, not possible to compensate or buy
    out terrorists with alternative incentives.

A movie Positive Feedback.