Future Discounting and Coalition in an Unstable Environment among the Turkana of East Africa
(University of Nevada, Las Vegas)
Why do most people choose the lump sum over the 30 annuities when they win at the Superball? And they do so even though the whole amount of the 30 annuities combined is more than double the amount of the lump sum and that winners are certain to receive their full annuities regardless of the vagaries of the financial market! Why do most people reject such an attractive offer in order to choose the lesser of the two deals (the lump sum) that obviously seems more attractive to them?
And indeed experiments have shown that all else being equal, when offered to choose between a smaller sum of money immediately and a larger sum at a later time, most people feel a strong urge to choose the former. Thus in specific conditions people seem to systematically discount attractive future promises, choosing a good of a lesser value if it is available immediately over future goods of greater values. Why is that?
We can make sense of that human propensity by adopting an evolutionary stance. Optimal discounting holds that selection should favor organisms that discount the future when a relatively effortless and good return is easily attainable. So it makes sense for an organism to be broadly biased toward a present opportunity, hence discounting potential greater future opportunity, for as long as the expectation of return somewhat meets the organism’s present needs.
The bias toward present goods can be affected in various ways. One of those is by adding social dimensions. When asked if participants would rather take a smaller sum of money for themselves instead of giving a bigger sum either to their mom (allowing themselves some easy future returns), a kin, a friend, an acquaintance, or an unknown person, we see some interesting modifications for how the participants discount the future. Social ties do matter and bias our choice in one way (more altruistic) or another (more selfish).
Most studies showing the consistency of the propensity and its modulations (through the use of social dimensions for instance) have been run in the western world. We know that our world is fairly stable if we compare it to the world of hunter-gatherers or pastors. The author was wondering if we would see contextual effects, if similar experiments to the one run in the Western world were run in a very unstable socio-cultural context.
The Turkana herders live in a very harsh environment in Northwest Kenya. Droughts and famines are regular occurrences. Social strives and inter-ethnic wars as much as cattle rustlings are quite common. In such context, a strong tendency to discount the future in most situations should be the norm, as no one knows too well what tomorrow could be made of. The author ran an experiment to try and see if such contextual effects could be detected. He proposes to present the Turkana data, comparing them to Western data, and offers some preliminary interpretations.