The strategic basis of principled behavior: a critique of the incommensurability thesis.

• Author: Posner, Eric A.
• Position: Symposium: Law and Incommensurability

When my love swears that she is made of truth

I do believe her though I know she lies,

That she might think me some untutored youth

Unlearned in the world's false subtleties.

Thus vainly thinking that she thinks me young,

Although she knows my days are past the best,

Simply I credit her false-speaking tongue;

On both sides thus is simple truth suppressed.

But wherefore says she not she is unjust,

And wherefore say not I that I am old?

O, love's best habit is in seeming trust,

And age in love loves not to have years told.

Therefore I lie with her, and she with me,

And in our faults by lies we flattered be.

--Shakespeare's Sonnet 138

INTRODUCTION

The incommensurability thesis holds that people cannot always value options along a common metric that is normatively justified. Most advocates of this thesis argue that people can choose among options, but that the choice depends on qualitative differences between options that cannot be reduced to vectors on a single dimension of evaluation.(1) The thesis, it should be noted, is not a theory of choice. Rather, it is a label attached to a social phenomenon: the tendency of many people to refuse to make tradeoffs in everyday life that are said to be demanded by the theory of rational choice. Because these refusals are anomalies for rational choice theory, they are said to justify rejection of that theory and its replacement with a superior theory of choice. Conceived in this way, the incommensurability thesis justifies a research program devoted to the discovery of a theory that unifies our intuitions and observations about the choices people make.

It is a difficult question when and whether to abandon or modify an old theory because it does not fully explain the phenomena it is intended to explain. Usually, people do not abandon an old theory until a better theory has presented itself. Although some advocates of the incommensurability thesis have presented their own theories of choice,(2) these theories have little explanatory power. Right now, then, the question is whether incommensurability poses a serious enough challenge to rational choice to justify either abandoning it or modifying it. I want to make only a modest claim: One should not reject rational choice theory because of its failure to explain incommensurability without first exploring how rational choice theory might deal with incommensurability. That is to say, does the incommensurability thesis really identify anomalies in rational choice theory?

I will argue that it does not.(3) Although the incommensurability thesis often describes people's representations about themselves, it does not describe their actual behavior--that is, the choices they make in everyday life--although their representations sometimes influence their behavior. People rationally make incommensurability claims in order to obtain strategic advantages in their interactions with others. Incommensurability claims do not reflect people's interests and values; they conceal them.

The argument has two parts. First, I present a model in which people take actions and make statements in the hope of acquiring a valuable reputation for trustworthiness. In this model, false statements about one's values emerge in equilibrium, and these false statements have a common element: They take the form of principles. Whether or not people believe that they are principled, most people will violate their principles when doing so serves their interests, even though they must and do publicly express their commitment to those principles. Second, I argue that incommensurability claims are a type of principled claim. Incommensurability claims emerge in equilibrium even though people do not act consistently with them and even though they do not express people's values. Incommensurability is not so much a problem about values; it is a problem about social coordination and ideology. The Article concludes with a discussion of the normative implications of the analysis, arguing that incommensurability claims should have little weight in any theory of social choice. As a positive matter, however, governments must and do give weight to incommensurability claims.

To motivate intuitions, I set out some examples of incommensurability, all taken from Sunstein.(4)

* A person cancels lunch with a friend and feels bad, but he could not properly offer the friend $20 as compensation. Friendship and money are not commensurable.(5)

* An employer could offer an employee an extra $1000 to do work that would require an absence from home for a month, but could not, without insulting the employee, offer to pay the employee $1000 to persuade him to work away from home for a month. Family relations and money are not commensurable.(6)

* A beautiful mountain may strike awe in the heart of an observer, but a statement like "this mountain is worth $10 million" would not escape from his lips. Environmental wonders and money are not commensurable.(7)

* One should not offer to pay a neighbor $20 to mow one's lawn, or offer to pay a person for sex. Neighborly and intimate relationships are not commensurable with money.(8)

* It is insulting to suggest that an actor's or teacher's worth is equal to his pay or any amount of monetary compensation.(9)

* It is wrong to say that a worker's life is worth eight million dollars (or some other amount), even though the worker accepts a wage premium of $800 for a job that carries with it a one-in-ten-thousand chance of fatal injury above the norm.(10)

These examples present the following puzzle: Although the statements command a great deal of assent and appeal to one's intuitions, and the simplest explanation for their force is that certain options are incommensurable, people in fact behave as though they believed that these options are commensurable.

The reason that people treat supposedly incommensurable options as though they were commensurable is that resources are scarce and choices must be made. Sunstein mentions the "desperately poor [person]" who might abandon a friend for a sum of money, but he is altogether too delicate.(11) Lawyers, businessmen, movie moguls, politicians, and even ordinary people constrained by time and resources drop friends when the costs of maintaining the friendship become too high. People routinely risk or violate family relationships by accepting attractive job offers in distant locations. Individuals make implicit valuations of the environment when they choose detergents, buy paper products, recycle newspapers but not bottles, purchase large houses rather than small apartments, and litter. People pay for sex or for companionship, sometimes overtly and other times in carefully disguised manners, such as in the form of gifts. Artists and teachers become investment bankers when their pay falls below a certain level. Workers accept premia for risks, and agencies use these risk premia in order to calculate the costs and benefits of regulations.

The puzzle, then, is why people say, and even believe, that certain options are incommensurable and sometimes act in ways designed to maintain the pretense of their incommensurability, while at the same time acting as though those options were commensurable. Sunstein, Anderson, and others seize one horn of the dilemma by arguing that the incommensurability of options is fundamental, and that a theory of choice that accounts for it can explain people's actions.(12) I will seize the other horn of the dilemma and argue that "incommensurability claims," as I call them, emerge in an equilibrium in which people rationally seek partners for the purpose of obtaining gains from cooperation.

1. A MODEL OF PRINCIPLED BEHAVIOR

   People can obtain strategic advantages by limiting their options prior to interactions with others. Suppose, for example, that a buyer and a seller are negotiating over the sale of a widget, and the price will be between five and ten. Both parties are willing to accept any price in that range, but the buyer wants the lowest price and the seller wants the highest price. If the buyer can bind himself against accepting a high price, and the seller knows this, the buyer has a strategic advantage. One way the buyer might be able to bind himself to a low price is by making a deal with a third party prior to this negotiation, in which the buyer promises to pay the third party twenty if he pays more than five for the widget. Confronted by this deal, the seller would concede to the price of five, knowing that the buyer would not accept a price of six or higher, since that would require the buyer to pay twenty-six or more for something that he values at ten. This kind of strategic maneuver can be called a commitment mechanism.(13)

   One uses commitment mechanisms not only for obtaining advantages against competitors, but also for giving assurances to friends or partners. Suppose that the seller and the buyer agree on a price, but although the seller cannot deliver the widget for three weeks, she needs to be paid right now. The buyer does not trust the seller to keep her side of the bargain. He fears that if he pays in advance, the seller will deliver the widget late or not at all, and the buyer believes that any legal remedy would not provide sufficient compensation. One way that the seller might overcome the buyer's suspicion is to give the buyer a beloved pet as a hostage. If the seller fails to deliver or delivers late, the buyer can dispose of the pet. Because the buyer does not want the pet, he has no incentive to keep it rather than accept the widget; and because the seller values the pet more than the widget or the gains from late delivery, she will deliver on time. The commitment mechanism in this case overcomes a barrier to cooperation.(14)

   The two commitment mechanisms discussed so far--third-party deals and hostages--are not as important in social and commercial life as a third: reputation. If, in the first case, the buyer has a reputation as a hard bargainer, this...