Reason.tv: Neuroeconomist Paul Zak on Markets and "The Molecule of Love"

September 9, 2009

 

"Markets are pro-social.  Markets are about serving the needs of another—that is innately virtuous," says Paul J. Zak, professor of Economics at Claremont Graduate University.

Zak is the founding Director of the Center for Neuroeconomics Studies at Claremont and is credited with the first published use of the term neuroeconomics, a new discipline that integrates neuroscience and economics.  He describes neuroeconomics as the "brain basis for decision-making" or simply put, "It's really about why people make bad decisions regarding money."

In 2004, Zak's lab discovered that the chemnical oxytocin (best known for inducing labor in women and giving us that warm fuzzy feeling when we hug someone) allows us to determine whom to trust in situations that require exchange. That's the same trust that makes trade possible and underpins modern civilizations and economies.

Zak discusses his oxytocin argument, presented in Moral Markets: The Critical Role of Values in the Economy and why even the most untrustworthy among us leads to a healthy and moral marketplace.

Approximately 10 minutes long. Produced by Hawk Jensen with Alex Manning as director of photography.

Go here for embed code and downloadable versions. If you have trouble embedding, check out the version posted at Reason.tv's YouTube channel (subscribe today!).

Comments

|9.9.09 @ 10:46AM|#

"Markets are pro-social. Markets are about serving the needs of another-that is innately virtuous,"

Racist!

|9.9.09 @ 10:52AM|#

Trade doesn't require empathy. It's mutually beneficial without caring for the other person. When I trade something the good/service I provide, I trade it for something I value more and vice versa with the person I'm trading with. If I value what they have more, then I'm giving them something of lesser value, and hence it's contradictory to what Zak says.

Easy experience of this: Go play Settler of Catan.

|9.9.09 @ 12:09PM|#

Trade doesn't require empathy.

No, but on any socially beneficial scale it requires trust.

Ian|9.9.09 @ 12:20PM|#

Reason, Bravo! This is an excellent short. Thank you for continuing the great work!

Kevin|9.9.09 @ 1:55PM|#

Well, "the science" backs our opinion. Therefore debate is over. (Hey, it worked for Global Warming!)

Sean W. Malone|9.9.09 @ 3:35PM|#

The debate is never over... Even when science, logic and all of history vindicates your opinion, that is never enough for a large swath of the population.

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Morton Kurzweil|9.9.09 @ 11:57PM|#

Zak is on to something - probably coke. His conclusions are something out of the sixties.

"If it feels goo, it must be moral."

This is the end of conservatism as we know it.

A T|9.10.09 @ 2:45AM|#

Also, he used the expresion "we can design". Scientists making thought experiments then on to the drawing board "designing" and social engineering stuff...
Me not likee.

Tman|9.10.09 @ 3:25AM|#

Thank you, Mr. Zak and Reason, for this video.


The usual trolls will look for infinitesimal weaknesses within the theories of neuroeconomics but the true libertarians amongst these forums will quickly recognize the evidence that jumps from the video.

Things like; morality is not dependent upon religion or social/cultural input, but instead an innate function of humanity that is best utilized through capitalism.

One could make an analogy between Einsteins theories that were predicted yet unable to be falsified until modern technology was able to test them and Adam Smith's "Theory of Moral Sentiments" which argues that sympathy is the basis for moral behaviors, with which now we have the chance to falsify through evidence of biological functions.

Truly fascinating.

|9.10.09 @ 6:11AM|#

The neuroscience towards the beginning was interesting. But towards the end it devolved into pure Pollyanna crap.

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