Dani Rodrik on Ideas and Interests

27 04 2012

Dani Rodrik has published a great post about the respective roles of ideas and interests in shaping government policy. See here.  Every historian should read it, as he is talking about an issue that historians have to grapple with: what causes people to act in a particular way– is it ideas/culture/values or simply pressure-groups in the background?

Proponents of the Rational Actor model of human behaviour say the latter, most cultural or religious historians would say the former. This is a question that we ask about the behaviour of a wide range of actors, ranging from nation-states to companies to individuals.

Rodrik writes:

The most widely held theory of politics is also the simplest: the powerful get what they want. Financial regulation is driven by the interests of banks…  this explanation is far from complete, and often misleading. Interests are not fixed or predetermined. They are themselves shaped by ideas – beliefs about who we are, what we are trying to achieve, and how the world works. Our perceptions of self-interest are always filtered through the lens of ideas.

Similarly, imagine that you are a despotic ruler in a poor country. What is the best way to maintain your power and pre-empt domestic and foreign threats? Do you build a strong, export-oriented economy? Or do you turn inward and reward your military friends and other cronies, at the expense of almost everyone else? Authoritarian rulers in East Asia embraced the first strategy; their counterparts in the Middle East opted for the second. They had different conceptions of where their interest lay.

Rodrik’s ideas are broadly similar to John Maynard Keynes, who he references in his piece. Keynes underscored the power of economists and philosophers when he wrote that  their ideas “both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else… practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist”. [i]

Rodrik is making a very good point here.  For historians, the issue is how we balance two interpretative traditions traditionally seen as incompatible. The Rational Actor model, which is popular with many political scientists and economists, holds that individuals decisions are best understood if we proceed on the assumption that they are entirely self-interested.[i]

The Rational Actor model suggests that the appeals to the common interest, high principles, ideologies, religious values, or the teachings of philosophers that politicians sprinkle into their speeches are  meaningless verbiage designed to throw observers off the money trail.

In the US historiography, there is a major debate about whether US constitution should be interpreted as a function of the economic self-interest of the individuals who gathered in Philadelphia to write it or whether understanding the constitution’s origins involves looking at the influence of Montesquieu and Aristotle and other Great Thinkers. Robert A. McGuire published a really convincing book arguing the economic self-interest thesis in  Form a More Perfect Union: A New Economic Interpretation of the United States Constitution. Oxford: Oxford University Press, 2003. There is a good survey of the historiography there.

Although narrative political historians  rarely  formalize their working theory of human behaviour in explicit terms, many scholars of Canadian Confederation lean toward the Rational Actor view. Commenting in 1963 on the learned references to Shakespeare and Greek philosophers in the legislative debates on Canadian Confederation,  historian Peter Waite dismissed them as “twaddle” and just so much hot air.[iii] Waite’s comment suggests that the real reasons for Confederation will be found not in the public debates but in the backroom deals about railways, transfer payments, and jobs for pals.

A very different approach to political history suggests that new ideas and cultural shifts are what drive political and social  and, constitutional change.  For example, consider Janet Ajzenstat`s recent book, The Canadian Founding: John Locke and Parliament. Here, Professor Ajzenstat argues that John Locke (1632-1704) was the political thinker who did the most to inspire to Confederation.


Just as the proponents of the Rational Actor model have favourite examples to support their view, those historians who emphasize the causal power of ideas have their own supporting data points. The campaign to abolish the trans-Atlantic slave trade and then slavery would be a great piece of evidence to use to support the “ideas matter” thesis: few historians today would suggest that the abolition of slavery in the British Empire was motivated by economic self-interest, which is what Marxist historians once argued. Indeed, the abolition of slavery in the British Empire is now regarded as a case of religiously-motivated “econocide” (i.e., the killing of a profitable economic system for ethical reasons). In other words, values not material interests determined how the relevant actors, in this case the majority of members of the British parliament, acted. [vi]

I don’t suppose that the perennial debate of the relative importance of ideas and interests in determining human behaviour will ever be resolved, but it’s worthwhile thinking about this issue.

[i] Ira Katznelson and Barry R. Weingast “Intersections between historical and rational choice institutionalism” in            Preferences and Situations : Points of Intersection between Historical and Rational Choice Institutionalism edited by Ira Katznelson and Barry R. Weingast (New York : Russell Sage Foundation, 2005).

[ii] Forrest McDonald, Alexander Hamilton : a Biography (New York : Norton, 1979), 202-3

[iii] Quoted by Ged Martin in introduction to The Confederation Debates in the Province of Canada 1865 (Montreal: McGill-Queen’s University Press, 2006), p. xxiii.

[iv] Robert L. Spaeth, “Ideas Have Consequences — Or Do They?” College Teaching 34 (1986): 17-19.

[v] John Maynard Keynes, The General Theory of Employment, Interest and Money (London: Macmillan and co., limited, 1936), 383.

[vi] Seymour Drescher, Abolition : a History of Slavery and Antislavery (Cambridge: Cambridge University Press, 2009).

[i] John Maynard Keynes, The General Theory of Employment, Interest and Money (London: Macmillan and co., limited, 1936), 383.



One response

29 04 2012

When I led seminars on the Theory of History a couple of years back, I enjoyed class discussions on questions such as this – which is essentially a variation on the age-old structure-agency problem. In my classes, students responded very well to Giddens’ approach in The Constitution of Society. The stratification model of social practices proposed by Giddens was particularly useful in opening up discussions on the nature of the historical explanations which students were advancing in their essays and undergraduate dissertations.

Put simply, Giddens’ approach to social practice calls for a consideration of (1) the conditions (structures) which determine action, (2) the reflexive actor, and (3) the unintended consequences of action. The underlying idea is that actors do not have unmediated access to the structures (or interests) that shape their actions – though powerful, these are filtered through ideas and ideologies. At the other end, human agency produces both intended and unintended consequences, which subtly alter the structural context in which future action takes place. Structures or ‘objective’ interests and ideas are thus integrated into one frame of analysis.

Over the years, social scientists have of course come up with many variations on the same idea. Because, as the great man with the beard himself wrote in 1852: “Men make their own history, but they do not make it as they please; they do not make it under self-selected circumstances, but under circumstances existing already, given and transmitted from the past […] The tradition of all dead generations weighs like a nightmare on the brains of the living.”

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