Marketing and Economic Anthropology

From an interview with Tyler Cowen 

As more of our economy becomes about marketing this will mean economic theory explains less and less of what’s going on. I think what I call “the economic anthropologists” will rise in importance. It will be hard for them to show that what they’re doing is as equally scientific as the traditional number crunchers, but nonetheless that will be the way to understand what’s actually going on. 

So I’m a big fan of someone like Grant McCracken, who is, in fact, an anthropologist. He spends a lot of his time working with companies, helping them figure out how they can understand what it is their consumers care about and how to grab the attention of those people.

Here Tyler tells his perspective on the difference between economics and anthropology. Tyler himself has done remarkable work on (or with) economic anthropology. His books An economist gets lunch and Markets and Cultural Voices combined, among other things, ethnographic field work, anthropological concepts, with behavioral economics, history, and economic theory (a great interview about the first book is here). 

Here there is a piece on economic anthropology I wrote, its definition and its future. But I missed one of Tyler's main points, which is economic anthropology as a way to analyze consumer behavior, as a complement, and may be as a substitute, of big data analysis (data mining/multivariate statistics). 

On the Negative Returns of Owning Cows and Buffaloes

Santosh Anagol, Alvin Etang, & Dean S. Karlan claim in a new paper:

We examine the returns from owning cows and buffaloes in rural India. We estimate that when valuing labor at market wages, households earn large, negative average returns from holding cows and buffaloes, at negative 64% and negative 39% respectively. This puzzle is mostly explained if we value the household’s own labor at zero (a stark assumption), in which case estimated average returns for cows is negative 6% and positive 13% for buffaloes. Why do households continue to invest in livestock if economic returns are negative, or are these estimates wrong? We discuss potential explanations, including labor market failures, for why livestock investments may persist.

Instead of providing an answer the authors put forward the puzzle, they explain:

In Hinduism, the cow is a symbol of wealth, strength, abundance, selfless giving and a full earthly life.20 As almost all the sampled households reported that they were Hindu, they may also derive spiritual returns from cattle ownership. The foregone returns compared to their next best investment alternative would effectively be the cost of religiosity in this context. This of course does not explain the results for buffaloes. P. 14.

 And the implications for aid:

Our results suggest that merely transferring an asset alone may not be sufficient to generate higher income (beyond the value of the transferred asset). P. 15.

Central Bank Rituals

We apply the ethnographic tools of economic anthropology to analyse a particular ritual performed by the high priest of the Arbee sub-tribe in the South Pacific island group of Aotearoa. (In other island groups, this high priest is sometimes known as the Governor of the Reserve Bank of New Zealand.) The ritual is considered by many within Aotearoa to be the cause of The Imbalance in The Economy. We analyse this claim and show that it has similarities (and equal validity) to claims of other cargo cults within the South-West Pacific region.

That is from a paper by Arthur Grimes (Journal of Economic Surveys, September 2013). A draft is here. The pathbraking article in that type of research is Leijonhufvud (1973). 

Is there a Welfare Culture? [Norway]

Wikimedia Commons

In this paper, we investigate the existence and importance of family welfare cultures, where the take up of a welfare program by one generation causes increased participation in the next generation . . . 

From the abstract:

. . . [W]e find strong evidence that welfare use in one generation causes welfare use in the next generation: when a parent is allowed DI [disability insurance], their adult child's participation over the next five years increases by 6 percentage points. This effect grows over time, rising to 12 percentage points after ten years.

The paper (July 2013) is by Dahl, Ravndal Kostol & Mogstad. 

A critique of economic imperialism

The extension of economics to topics that lie outside its classical domain is known as ‘economic imperialism’. But there are territories of social science that persist to be largely intractable using the postulates of economic theory: the anthropological subject of primitive societies represents one such territory. This paper describes and discusses the representation of primitive societies by economists from the proto-imperialist model of Smith to the imperialist Posner's model. It maintains that (a) the economists’ attempt at interpretation is highly unsatisfactory and (b) it is possible to offer a different representation of the primitive societies, one more coherent with the anthropological and ethnographical data, and able to show the inadequacy and insubstantiality of many economic categories when applied to those societies.

That is from the paper titled "The economists and the primitive societies: A critique of economic imperialism" by Roberto Marchionatti - in the latest number of the Journal of Socio-Economics, October 2012. Of course the classic response from the economics side in this old debate was this one. Is this debate still alive?