Although Self-interested does not mean selfish, this guy is a selfish jerk

Self-Interested Does Not Mean Selfish

When People Hear “Self-Interested,” They Often Think of Jerks

Self-interest” tends to be an ugly phrase among non-economists (particularly sociologists to my limited experience.)  For many people it implies screwing other people over, taking advantage of others, not giving to charity, etc.

A self-interest jerk using money to light his cigar
A self-interested jerk
From Econ Stories (a personal favorite)

Indeed, there has been research suggesting that economists (who tend to promote the good of acting in a “self-interested” manner) are, in fact, more selfish than people in other disciplines.  See here or here for some examples.  See here for a decent blog talking about why lots of those studies are flawed.

More important than these results, in my opinion, is what “self-interested” really means.  This comes down to what “self” means.


“Self-Interested” Behavior Depends on What we Define as “Self”

I contend that in practice, we don’t limit our definition of “self” to the borders of our bodies.  Here are some examples of such a mentality taking place:

  • “I am a Father”
  • “I am a citizen”
  • “I am her son”
  • “I am a U.S. Marine”
Dad, you've always been like a father to me.

Please note that as of now, I am not a father, nor a marine.  These are examples.

In the examples, anyone that can honestly say the phrase is instantly wrapping his or her identity in with “other” people and entities.  If I am a Father, then my children have an inherent place in my identity.  To act in a “self-interested” way that harms my children is to not act in a “self-interested’ way at all.
As a husband (another thing which, as of now, I am not,) I cannot act against the interest of my spouse without either acting in a non-self-interested way, or separating myself from the identity of “husband.”  Most of our identities are wrapped up in the connections the identities create in relation to others.  We can’t act in a self-interested way without including those we are tied to in the calculation.

What Happens When We Tie Our Identities With “External” Entities?

When we truly consider “others” as part of our “self,” we will work as tirelessly and as passionately for “their” good as we do for “our” good.
Christ praying in Gethsemane
Jesus Christ

We can look at Jesus Christ as a perfect example of this.  He considered all of humanity as important to Him.  Enduring the atonement, paying the ultimate price for the sins of others, would not be in the best interest of an individual bounded by skin, but Christ considered all humanity important to Him.  Christ certainly acted in His own self-interest, but His interest was tied in the interests first of His Father, and then of His children.

For less perfect and divine examples, just look at the millions of parents who make sacrifices to do good for their children, citizens who sacrifice for their respective countries, and any player who “takes on for the team.”

But What About one of Adam Smith’s Famous Quotes?

Adam Smith said in The Wealth of Nations that

Adam Smith portrait
Adam Smith

“By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.  I have never known much good done by those who affected to trade for the public good.”

This tends to be true for two reasons:

  1. Lack of knowledge
  2. Lack of drive
1.  You do not tend to know as much about what your neighbor wants as much as you know about what you want.  You do not know precisely when your neighbor is hungry, nor what your neighbor wants to eat, nor much of anything else with quite the precision as you might know yourself.
Because of this, if you try to help your neighbor by getting him or her food you think he or she wants or needs, you run a high risk of getting it wrong.  This is a trivial and simple example, but imagine the complexity of someone trying to really understand the far-reaching effects of “trad[ing] for the public good.”  Helping on a macro scale requires intense and detailed knowledge and coordination that we often just don’t have.
Sleeping giant
One of these is inside you, right now!

2.  People just don’t work as hard for others as they do for themselves.  How many of you work hard in school and put in long hours at work so that Mr. You’ve-Never-Met-Him can get a nicer car?  I would guess that more people will make the sacrifices to get the car themselves rather than to get the car for another.

When we lack love or connection with another, we do not pursue improvement and engage in labor or difficulty quite as passionately and tenaciously for others as we do for ourselves.  It takes personal investment to awaken the sleeping giants within us.

Here’s the kicker though, even though we don’t always have sufficient knowledge on how to help others, nor the drive to do it, that’s often the case when we’re dealing with ourselves as well.  People are not infallible.  Although we tend to have a better idea of what we need personally, we still mess that up.  Although we tend to be driven for our own well being the most, we often take easier routes to conserve energy (my friend Hank made a video about Hyperbolic Discounting that describes some of what goes on here in economic terms.  Check that out here.)

As time and technology get better, macro policies for the greater good may eventually become at least as effective as individual choice.  Things like Big Data analysis are constantly improving and the social and biological sciences continue to discover more about us than we like to know.

So, What Do We Do?

Dilbert and the end of capitalism
Yes, you do have to be ethical in business

In spite of our limitations and the inevitable mistakes we make when we try to “trade for the public good,” we still need to increase our love and connection with others to expand our “selves.”  The problems and mistakes we deal with when people try to do good for others tend to be preferable to a world where everyone is willing to hose the next guy if it truly has not negative personal effects (including damaged reputation and ability to effectively interact in the future.)

Besides, when we try to do good and we mess it up, at least we can passionately pursue improved actions and ideas that will eventually surmount the problems we face.

Keep seeking truth.

You may also be interested in:
Ethics and Snowden
Dating and Game Theory
Peru Post 4: The Work

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