Subjective and Objective

One of the most fundamental facts about modern societies is that they depend on exchange: almost all of the things we need for our daily lives are produced not by ourselves but by others. Many of these exchanges are conducted between complete strangers. Some exchanges take place through the institution of markets, others through firms and a great variety of non-market institutions. It might seem that a disposition to “truck, barter and exchange ” (in Adam Smith’s words) is so natural to human beings that it needs no further explanation, but in fact a careful study of our prehistoric past suggests that it is a profoundly unnatural thing to do, and has become a universal feature of human existence only in the relatively recent past. This course ask four questions: 1) How has exchange with strangers become a near-universal feature of human societies when everything suggests it was a very unnatural thing for our prehistoric ancestors to do? 2) Under what circumstances do markets provide a natural and relatively efficient means of undertaking these exchanges? 3) What kinds of non-market institution provide an alternative means of undertaking these exchanges, and under what circumstances do they work naturally and efficiently? 4) How are changes in the technology of information transmission and processing changing the nature of the institutions that mediate economic exchange