David Henderson is not happy with Richard Thaler’s potshot against neoclassical economics.
Thaler made a typical joke about economists—that if they treated their loved ones the way their models imply they do, they would be very unloving, indeed.
Henderson digs his feet in and insists that expected utility calculations are central to evaluating a “potential romantic partner.”
You fall in love with someone. You start discussing your future. You find out that you’re a Bryan Caplan who wants 10 kids and she’s a career woman who wants $10 million. What do you do? You drop her, or she drops you. In other words, you’ve tried to get relevant information about this potential romantic partner and that information has led you to conclude that this relationship won’t work.
In another example, he explains how a specific preference that a potential partner has causes “Your estimate of the probability that this will work” to fall.
In other words, he presents us with a typical prudence-only story of how love works, going on to talk about the role of incomplete information and up-front investment costs, and so forth. Perhaps, beyond the narrow points he’s seeking to make against Thaler, he does not think that everything about love is so reducible to expected utility calculations. Keeping this possibility in mind, I’m going to respond to the version of love he actually presents in the post.
Love is hard to sum up in a single sentence, but I do like Deirdre McCloskey’s notion that “Love can be thought of as a commitment of the will to the true good of another.” I also think Daniel Russell’s notion of love being “embodied” is correct—that is, when you really love someone, their life becomes as inextricably a part of your own as one of your limbs. He draws on the literature on bereavement in which countless people talk about losing loved ones as though they had lost a piece of themselves—and the literature on amputees who make the metaphor in the exact opposite direction.
His non-utilitarian view of happiness goes like this:
So here’s a piece of advice: the person with the best chance for a happy life is the one who can cope with change, finds people to love, and then loves them as if his happiness, his very identity, depended on them. On my view, doing all of that wisely is just what happiness is.
Love means being someone whose very identity depends on his commitment to the true good of a specific person and people. Outside of economics, no one thinks “true good” means simply “satisfying preferences.” It means hoping that they will flourish, and develop into independent practical reasoners, even if that runs against your own preferences. For instance, if your daughter decides to become an English teacher rather than the doctor or lawyer you’d always dreamed they would be. If you love them, you will accept and respect their decision to find their own path to flourishing, rather than merely following the life-script you would prefer them to stick to.
Moreover, part of loving someone is challenging them when their preferences are at odds with their flourishing. When, for instance, they are an alcoholic, or they can’t be bothered to think seriously about their own future, or any number of other scenarios. This is not about imposing your preferences on theirs. Preferences are not morally neutral, and economists fall into one of the greatest follies of our age when they promote such an absurd neutrality.
True commitment to the good of another is an uncalculating good. In fact, it is well known that the marriages which last do so largely because we are not calculating the merits and demerits of the relationship. To call a spouse “calculating” is, for anyone other than an economist, an insult, and deservedly so.
Utility as Metaphor
What Henderson is grasping at in his post is the concept of compatibility, so central to modern conversations about dating. The process, early in a relationship, of deciding whether or not you are compatible is indeed more calculating than making a commitment. But it is still not so calculating as Henderson thinks. Both commitment and compatibility combine the sacred and the profane in ways that are not cleanly separable.
Now, expected utility makes for a neat metaphor for the calculating part of these. Determining compatibility is like entering into a business partnership, and deciding whether or not investing in that partnership will yield a net gain in the long run. Figuring out whether you can spend your life with someone is like figuring out whether your preferences are mutually exclusive, and the process of discovering this is like imperfect and asymmetric information in markets. There are implications of these metaphors that can be very useful in describing human behavior. Cool!
But there are richer metaphors and better stories—which I happily concede that economic metaphors and stories can supplement, so long as we understand that the relationship is one of supplementing.
For one thing, we do not have probability estimates of the success of our relationship. We have doubts, and we have hopes. And we have aspects that we cannot imagine being without. These are not commensurable, or reducible to some numeric scale.
We also do not have a fixed set of options that we are choosing among. James Buchanan liked to point out that most choices in fact emerge in the process of choosing. And our preferences are not fixed things. Buchanan’s point implies that preferences must be discovered themselves, but they are also open to negotiation.
In Alex Tabarrok’s law and economics course, we discussed the famous Justin Wolfers paper on divorce and the Coase theorem. Some of us thought it was pretty funny to talk about marriage in the context of Coasian bargaining. Tabarrok astutely pointed out that there’s a lot of give and take in a marriage, and so Coasian logic could be said to apply.
Yes, but incompletely, and as a metaphor. Certainly there are straightforward cases of compromising relatively stable preferences on behalf of your loved ones; I don’t like olives, and my wife does, but because we usually have the same meal, she ends up eating fewer olives than she would on her own. But opening your preferences up to negotiation for reasons relating to the sacred is a different matter. I was a very picky eater when I met my wife, and I consciously expanded my horizons after we met because I wanted to become the kind of person who could be with her. And that person was someone who could eat at nice restaurants as well as exotic ones, who could travel and share in the food culture of a foreign city as much as the rest of its culture. And this was one of the smaller ways in which I reconsidered my priorities after meeting her!
To return to Buchanan’s point, our relationship to our own preferences and choices itself often has the character of a discovery process. Commitment to a loved one means sharing that journey with them. Rather than all of us having a fixed idea of whether we want 10 babies or want to spend a lot of time in bars, we discover just what kind of person we will become, when we become the kind of person who can make a love of our wife or husband or son or daughter a central part of who we are.
We may indeed find that compatibility eludes us, and commitment would not make sense, for primarily prudent reasons. But what I have observed of many of my single friends, especially since moving to New York where the “dating pool” is quite vast and made more accessible by online services, is that calculation becomes a curse. When the “opportunity cost” of commitment is perceived as high because of how many potential partners your area affords you, and your evaluation rests primarily on compatibility as modeled by Henderson, you basically never find a reason to commit.
Those who finally find someone do so not because they have hit the right expected utility, but because they have found someone who at last makes them forget about cost-benefit analyses.