Is Generalized Utilitarianism and Maximization Universal?

Generalized utilitarianism and maximization are concepts that lie at the heart of neoclassical economic theory and the position taken by formalist anthropologists.

It is based on the understanding that individuals are rational actors who seek to maximize their own self-interest, and that markets are efficient mechanisms that allocate resources effectively.

However, the assumption that these concepts are universal has been subject to much debate in economic anthropology.

While it is true that human beings will make decisions that they perceive to be maximising their utility, this statement comes with a very big caveat, that what constitutes utility and how this is maximised can vary dramatically between different cultures.

Hence ‘economic man’ will make choices and engage in behaviours that maximise economic returns, such as the accumulation of wealth, whereas in another culture people will give away as much wealth as possible to maximise their return in terms of social connections and prestige (Sahlins 1963, 1972; Hann, Hart 2011; Wilk, Cliggett 2007).

Furthermore, it is also possible to have different forms of exchange operating based on different principles of utility under different circumstances within the very same society.

To illustrate this dichotomy, I will refer to the Kula, where two different types of exchange operated in parallel. In the gift exchange precious items were given away, not with the intention of obtaining any financial return or accumulating wealth, but to forge strong social connections and cultivate the prestige of both the giver and the recipient (Malinowski 1920; Hann, Hart 2011).

However, the islanders also operated a market exchange that was totally separate, where careful consideration was taken of market prices to maximise the returns resulting from barter transactions (Malinowski 1920; Hann, Hart 2011).

I posit that the diametrically opposed behaviours evident in the two different exchanges can both be defined as seeking to maximise utility – the only difference is in what is being maximised. Thus, in both cases, when giving precious gifts away or negotiating to barter obsidian for red ochre, the islanders were maximising their utility according to their specific criteria for that transaction.

That said, it is important to note that it would not be accurate to say that it is possible to understand and predict maximisation behaviours with the use of mathematical or economic models alone.

Ultimately to truly understand what is happening, both in situations of reciprocity and redistribution (gift exchange), or in market exchanges, one needs ethnographic insights that enable us to decipher what the goal of the transaction is, to understand the utility of the transaction and what the participants are seeking to maximise.

In conclusion, while the concepts of generalized utilitarianism and maximization can be broadly assumed to be universal, it is still important to take into consideration different social, cultural and historical contexts in order to properly take into account the complex and diverse motivations of individuals making maximisation decisions.

References

Hann, C., Hart, K. (2011) “The Golden Age of Economic Anthropology.” In Economic Anthropology: History, Ethnography, Critique. Polity, pp. 55 – 71.

Malinowski, B. (1920) “Kula: The Circulating Exchange of Valuables in the Archipelagoes of Eastern New Guinea.” Man (London), pp. 97-105.

Sahlins, M.D. (1963) “Poor Man, Rich Man, Big-man, Chief: Political Types in Melanesia and Polynesia”. Comparative Studies in Society and History, 5(3), pp. 285-303.

Sahlins, M. (1972) ‘The Original Affluent Society.’ In Solway, J. (2006), The Politics of Egalitarianism. Berghahn: United States.

Wilk, R.R., Cliggett, L. (200). Economic Anthropology – An Undisciplined Discipline. Routledge.