Seeking Protection and the Origin of the State: An Investigation Using Agent-Based Computational Economics

University Of Alabama In Huntsville, Huntsville AL

Investigators

Abstract

Consider a simple world populated with two kinds of individuals; those who work and create wealth (peasants) and those who survive by taking the property of others (bandits). The presence of bandits creates an incentive for peasants to seek protection and defend their property. But protection is costly; it consumes resources and interferes with an individual's ability to create wealth. This study investigates how individuals, peasants and bandits, might make decisions in such circumstances and how those decisions aggregate into societal characteristics. This project studies the origins and existence of social institutions by creating and simulating alternative environments using an agent-based computational economic (ACE) system. ACE is a methodology that grew out of the artificial life paradigm. In ACE simulations virtual worlds containing decentralized, autonomous, interacting agents are created and those agents are observed as they wrestle with the economic problem at hand. ACE researchers are interested in the equilibrium or steady-state characteristics of the system, the dynamic path leading to the steady state, and, in particular, the spontaneous emergence of an unplanned coordination or organization of these agents. This project starts with a simple world populated with two kinds of individuals; those who work and create wealth (peasants) and those who survive by taking the property of others (bandits). The presence of bandits creates an incentive for peasants to seek protection and defend their property. But protection is costly; it consumes resources and interferes with an individual's ability to create wealth. This study investigates how individuals, peasants and bandits, might make decisions in such circumstances and how those decisions aggregate into societal characteristics. The ultimate decision of the agents is greatly affected by a variety of environmental factors introduced to their virtual world. When there is little structure to constrain their activities, these societies usually evolve into anarchy, although small populations appear to organize and invest in some social protection. Such a result suggests that primitive societies could emerge in which groups cooperate-a state may arise-but those societies are likely to be quite small. A series of alternative structures and constraints are introduced to this world and the resulting societies are compared. For example, a spatial dimension is added so that location matters. Neighborhood effects are introduced, i.e., agents are influenced by the decisions of other, nearby agents. In some models individuals find the ability to coerce others to contribute to social protection. Comparing the different social structures, their economic proficiency, and the dynamics of these alternative worlds yield insight into the attributes that influence cooperation among self-interested individuals.