Murry Rothbard used to explain value and the law of diminishing marginal utility using an example of horses and cows: If a farmer prefers a horse to a cow does it mean that after buying one horse he would always choose horses over cows or would he have a stronger desire for a cow over a second horse or maybe more than having a third horse. A relative value is created in the farmer’s head based on his desires and the information available to him.

Let’s change things around a little: If the farmer would have to buy two horses before considering a cow, could we not effect his opinion by either making the horses much more expensive or offering a cow at a bargain basement price. Or what if conditions change: Maybe he was partial to horses because his daughter loved riding them but, as she got older other interests became more important. Does that alter his valuation. It would appear values are not only subjective but fickle. But we’ve always intuitively known this.

Does this apply to animals? What happens when an animal that has not had any food in a couple of days and only a little water runs across both food and water at the same place? Will it go for the food first or the water? At what point will it switch to the other? Will its actions be different if it looks like all the food and water will still be around for a while as opposed to having other animals vying for the same feast? Lastly, at what point will the animal choose to move on even when there’s still something left to consume? You may say it’s all instinctual, but it looks a lot like adjusting values based on diminishing marginal utility.

Cells couldn’t possibly value something… could they? Maybe they don’t appear to have the hardware or consciousness to have adjusting value systems, but if they respond as if they do, then can we say that in effect they do value some things over others and that these values change as some are met or as conditions vary?

I contend that every living cell and organism in the universe is adjusting its responses purposefully. We are, at every micro-moment of our lives: decision making; consequence analyzing; valuating; forsaking; scarcity managing; time space and resource confined; super machines made up of trillions of valuating cells sending an almost infinite number of signals all through our bodies.

I think I’m done for now and writing more on this subject is not as important as it was when I started.

 

Do All Living Things Economize?

I believe they do and I believe I can prove it with a thought experiment. But, first let me start with some examples:

Our Dog

Earlier this year I came home and found that our dog, Rachel, had drunk all the water in her bowl. I was surprised because she never does. No matter how erratic my schedule, and no matter how many or how few times I fill her bowl during the day she never finishes it completely.

She seems to leave some just in case. But, on this day when I filled it again she drank it all down in a few minutes. It turns out she was sick and had a kidney infection. The immediate need for water by her kidneys overrode her pattern to save some for later.

Does she economize?

Bodies

Our bodies, in fact all creatures, have complicated systems for:

• Transporting oxygen
• Converting food and then distributing it
• Waste management;
• Dealing with injuries, danger, illness and much more

Every time you hold your breath you are creating a potential problem of scarcity to which the body compensates by reallocating resources and in cases of possible drowning will shut down air to unessential systems.

The same happens when food consumption is reduced. The body begins to conserve and protect itself by minimizing damage and illness and doing all it can to prevent death.

This can be said to be what businesses do. Those who run companies get signals from their surroundings which they analyse to determine the effect it will have on their success. They will either ignore the signals or respond by trying to benefit from them.  If they can not benefit then they may have to do what they think is necessary to minimize losses, or worse, try  to prevent bankruptcy.

Microbes In Our Bodies

In addition to the actions in our bodies which are taken by our own organs and cells, new research is showing that there are many more microbes than human cells that live within us and from which we benefit. From Discover Magazine:

… enormous population of microbes, including bacteria, fungi, and viruses, that live in the human body, predominantly in the gut. There are 20 times as many of these microbes as there are cells in the body, up to 200 trillion in an adult, and each of us hosts at least 1,000 different species. Seen through the prism of the microbiome, a person is not so much an individual human body as a superorganism made up of diverse ecosystems, each teeming with microscopic creatures that are essential to our well-being.

In our bodies, at every instant, an incredibly huge amount of signals are not only being sent and picked up by our cells and organs but by a multitude of microorganisms that are each responding, on an individual basis. There are no external brains or nervous systems directly controlling their actions and responses. How is this not a chaotic disaster?

I believe there is an economics answer to this.

The Earth

James Lovelock, whose controversial Gaia Principle postulates that the world acts as a living organism whose inhabitants are driven by the desire to maintain life, has made some very interesting observations in order to derive his principle. He asks, for example, how is it that salt levels in oceans have been relatively constant for millions of years when the runoff of salt is variable? His answer is that increases in salt cause an increase in organisms that thrive on more salt, thus leveling it off.

Lovelock offers similar explanations of how the world’s temperature and ratio of oxygen, nitrogen, etc in the air that we breath have all remained so constant in spite of ever-changing influences on them. He argues, again, that organisms restore balance because more favorable conditions exist for those organisms whose bi-products help return the earth’s atmosphere to the state in which most creatures on earth best thrive.

This is very analogous to supply and demand and price signals.

Purposeful Action

Ludwig Von Mises, in his seminal treatise, Human Action, starts with, and demonstrates that, all laws of economics can be built from the fact that humans act purposefully within the physical limitations of not being able to do or know everything at once or to be everywhere at once. His expansion of these concepts, his Action Axioms, with his rigorous adherence to the core tenet is the model which the arguments I present here will attempt to emulate.

Mises, as well as Murray N Rothbard who expanded the action axioms, were very clear from the onset that their rules applied specifically and only to humans involved in conscious thoughtful actions. I wish to make the case that by using a more abstract definition of purposefulness, one that is not contingent upon consciously weighed human thought, we can bridge the differences necessary to apply some core economic principles to all living things as well as our unconscious responses. I make no effort to delve into the more obviously human-like interactions needed for business and human cooperation.

To create the core foundation, we need to demonstrate that all living beings act or respond purposefully. I did not imagine, nor did I set out to make a rigorous case for purposeful responses of single celled organisms but as I explored the idea I realized that it could be done. Since cells are the building blocks of life and on a physical level every living thing, from plant to animal is made up of only cells, I will make my arguments at that level.

My effort at a proof can be found here or on the proof menu tab above. Please let me know what you think.