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Omer Moav on the Emergence of the State


Russ Roberts: Now, your paper is an attempt to understand where hierarchy and the state come from, and it’s an incredibly creative and ambitious work.

I want to start with a question you don’t really deal with in the paper, because in papers like this, you don’t deal with these things, but that is: What do you mean by the state? I was telling my son about this upcoming podcast. He said, ‘The state–what do you mean, the state?’ Economists use it to mean a certain thing. For non-economists, non academics, what do you mean by ‘the state’ and what do you mean by ‘hierarchy’?

Omer Moav: Well, it is a relevant question of course, and it is well-defined when we go to the empirical part of the paper, because then there’s data, and data sets tend to be well-defined. However, what we care about, and maybe that’s a difference between economists and political scientists or anthropologists, is not the definitions, but the main ideas.

So, in our view, a state is an organization in which there is a strong elite which controls what happens, more or less, and taxes the masses. That’s a state. So, when income flows from the masses, historically farmers, to the central state, and the state could do stuff with this income, like provide law and order, military, attack others, build pyramids, whatever.

Russ Roberts: And some of it–the pyramid part is for the benefit of the elite, presumably. Sometimes it would be called confiscation or confiscatory taxation. But other times it’s going to provide what economists mean by public goods–you called it law and order, but it would be some power to police, some power to maybe some modes of transportation, clearing roads, and so on.

When we think about ancient times–which of course we have a very imperfect picture, and one of the challenges of this paper, and part of the creativity of it is how you try to get at that–when we think about ancient times, we think about the transition from hunter-gatherers to agriculture. So, somebody used to run around with a spear and now they’re running around with a hoe or seeds or some kind of agricultural implement. Where’s the state?

I mean, I’m a farmer now: What does that mean, a state? I could think about Ancient Egypt, but when I think about this transition period in these very early days, how might it have mutated from nothing to something?

Omer Moav: So, first, I’m pretty sure it was a very gradual process. But, it’s an interesting point that you raise and very important one, which is that the state emerged, I would say, in stages, more complex hierarchies emerged, eventually states, following the transition from hunting-gathering to farming, the so-called Neolithic Revolution.

And, that’s actually an important question: Why is it that following the Neolithic Revolution we see the rise of these complex hierarchies and states? And, part of what we do in this paper is actually refute the existing theory. And, in that sense, this is what makes this paper, I think, really important, on the one hand side.

On the other hand side, we had a very hard time to publish it because when you refute existing theories where many researchers are committed to, invested in, then they give you a very hard time as a referee. So, we really suffered. But, eventually, we’re really happy that it was published in the Journal of Political Economy. I should mention this is one of the top, top journals in economics. And, luckily, the editor in this journal actually went against the negative and hostile referee.

Russ Roberts: It’s ironic because I just recorded an episode that hasn’t been made public yet, Omer, where we talk about the perilous path of peer review and referee reports and how strange it is: that, if peer review was really a successful enterprise, when your paper was rejected, it would be over. You’d have to write something else. But, instead in academic life, you send it to a different journal. Now, you happened to send it to one of the–personally, I think the top journal in economics. I went to the University of Chicago; I’m totally biased. But, you’re giving us an example of how strange this process is. You’re saying that the peers who reviewed the paper didn’t like it so much, but the editor didn’t agree. But, I’m curious, relevant–

Omer Moav: Well, you know, Russ, if you open this, I could talk for at least an hour about, and provide many examples of how awkward, and I would say even corrupt, like mafia-wise, this process is to a large extent.

But, talking about the mafia, let me just say something which is really important. Back to the paper, you ask, ‘What is a state? How did it come to emerge?’ And, I think that today we tend to think, especially in liberal democracies, that the state is this benevolent organization; that we pay taxes, but there is this contract that the state gives us in return–stuff, all the public goods and so on and so forth.

But, historically, I think that the better view of a state is, as Mancur Olson published in his 1993 article, is just roving bandits turning stationary.

So, a state is a transition from random crime to organized crime. And, historically, I think that’s a very accurate description. So, the state is a powerful elite that could tax the masses and take care of its own good. That doesn’t mean that this is bad for the subject, because you should compare. I ask people, ‘Is it good to have a mafia organization control your life?’ ‘Well, yes, if the alternative is just random crime.’ So, in a sense, it was a win-win transition to some extent, but this is debatable.


Russ Roberts: When you think about that, the roving versus stationary bandit, if I’m a band of hunter-gatherers and we have a good kill–we kill a couple large animals and we’re excited–and someone comes along and takes them, then we move. We don’t want to stay in the same place. We want the bandits to have to find us again, and we hope we can find a place where the animals are and the bandits aren’t.

But, once you are in agriculture, you’re stationary. You can’t move. And you do become vulnerable to theft. And, the bandit who used to track you down in the field, hunting, now knows where you are; and they become stationary. The stationary bandit is the Mancur Olson model.

And of course, there’s a temptation for the ignorant bandit to take all your crops, burn down your house, and move on. But, the bandit realizes at some point that, ‘No, it’s not a bad thing if I leave something for the farmer. The next year they can continue to farm and I’ll get some more next year.’

So, it’s not the bandit that we see in the movies who takes all the gold from the stagecoach. Rather, there’s a symbiotic relationship there, when the bandit becomes self-interested in the wellbeing of the farmer, and that’s why it’s not as evil in terms of impact as it might otherwise be.

Omer Moav: Yeah. It’s just like modern mafia, in the sense that what do they do? They charge for protection. It’s not just really protection from themselves. You pay them not to attack you: that’s mainly part of the deal. But, they also protect you from others, and that’s the organized crime. And, organized crime is a more efficient outcome than these roving bandits that just take everything and burn your house.

But, Russ, maybe we should go a step back or move into–okay, so what are we saying in this paper that is new? To say that, I need to first explain briefly at least the conventional theory.

Now, when I say conventional theory, this is something really, really huge. You go back 200 years, you read Adam Smith, even thinkers before Adam Smith. You read and they tell the same story, more or less. And, you look at papers and books today that deal with the emergence of hierarchies and states, it’s always–almost always; I should be careful–the same variant of the following story.

The transition to farming allowed increased output. Farmers could produce more food than hunter-gatherers. And, with more food, they could actually produce surplus–so, more food than they need for their own consumption.

And, this surplus is a prerequisite for taxation and the emergence of states.

So, the story is the farmers produce surplus. Once there is this surplus, someone could take it away. It could be roving bandits, but it could be stationary bandits. And, here you go, you have hierarchies. Organized crime turn into chiefdoms and states, and so on and so forth. And the, there are variants: Is it a benevolent state or is it just a predatory state? These are details.

Now, we started working on this about 17 years ago, and just published less than a year ago. So, it was quite a long process. It started with a process of thinking about the issue. And, the main thought we have is that if you read Thomas Malthus and you read this story, there is a contradiction. If Malthus is right, then there is no surplus, because population will adjust to eliminate any surplus. That’s the basic Malthusian theory: higher fertility, if there is life above subsistence. And, as a result of increased population, income per capita declines back to the level of subsistence, meaning no surplus. So, that’s the main flaw we found with this literature.

But, in addition to that, here is a thought: Let’s do the following thought-experiment. Imagine a village that, say, grows some kind of cereal–barley, wheat, rice. Now, what is typical about cereal is that it is seasonal. So, the harvest typically takes place within a very short time in the year. And then, even if there is no surplus, the farmers have to store it for their survival throughout the year.

Now, suppose a tax collector arrives after the harvest is finished: all the crop is stored, and the tax collector arrives with a little army. Think of, for instance, Ancient Egypt. A tax collector on behalf of the Pharaoh arrives to the village and says, ‘I came to tax you. Give me 20% of your crop.’ Well, the head of the village could say, ‘Sorry, I don’t have any surplus this year.’ What would the tax collector say? ‘Oh, my apologies. I will try my luck next year?’ Of course not. Even today, you cannot tell the government, ‘Sorry, I don’t have any surplus.’ So, of course, in historical times, this claim is ridiculous. ‘You don’t have surplus, so what? I see the grain here, I’ll just take 20%.’ ‘Oh, but some people will die.’ ‘Well, who cares?’ We’re talking about history, who care. Today, in many places, people don’t care about death of innocent people, so of course, historically, this was the case.

So, this just simple thought-experiment illustrates that the idea that surplus is a prerequisite for taxation is just wrong.

But in addition to that, let’s do another thought experiment. Think about a village that actually has a lot of surplus, but the surplus is not a grain: but it’s like a root or a tuber. Think of cassava, for instance. Cassava is a good example, because as long as–it’s a root that is in the ground. And, as long as it is in the ground, it stays. It’s very well stored. But, once the farmer takes the root out of the ground, within a few days, it rots.

Now, what would do a tax collector if there’s lots of cassava in the ground? How do you move it from the farming area to build, say, pyramids or to provide the military? It’s just impossible.

So, you see, surplus is also not a sufficient condition. What you really need is not surplus, but a food that is easily taxed. And, that’s the main claim we make.

Now, we’re not–yeah, go ahead.

Russ Roberts: I was going to say, when I read that–you have just a little additional piece you have to add, and we’ll get to that in a minute–but: I’m done. It’s a really great paper. It’s really interesting. To try to show that that’s historically relevant is quite challenging, and we’ll talk generally about how you try to do that. It’s hard to do and you concede as much.

But, the fundamental idea that storability is crucial is profound.

The other thing you have to add, of course, is that cassava can be grown throughout the year. You can grow it at different times, harvest it at different times. So, the cassava grows, or the potato, and you eat it. Then you plant some more and you eat it. Or you’ve planted some more in between, and it’s occasionally showing up and you’re eating it.

Whereas, the grain shows up once and you have to store it. So, it’s wonderful that it can be stored; but it’s horrible because it can also be taxed. But the cassava has this fabulous–I mean, it’s fascinating. I think you’re the first people to notice this, is it–it’s horrible, cassava, because you can’t store it, but it’s fantastic because it can’t be taxed.

Now, the next question would be a very blunt, simple question, not subtle–

Omer Moav: But, let me just, because I want to be really accurate and not to take credit to myself, which is unjust. So, the idea that it’s easier to tax grains than cassava or other roots and tubers is not ours. We were not the first to make it.

The contribution of our paper is to say that the surplus argument is wrong. And that’s–you could point–James Scott is famous for that with his two bestsellers, The Art of Not Being Governed and Against the Grain. But, in fact, he was not–he got a lot of credit, but there’s already researchers from the 1970s and 1980s that made similar arguments.

But, the difference is that they basically took the standard conventional theory about surplus, but they say, ‘Look, surplus is important, but it should be surplus of something that is taxable,’ meaning storage is required and it is storable.

And, our contribution–our theoretical contribution–is to say: Surplus argument is wrong; you don’t need surplus.

Moreover, of course, the main thing that we do is we go to the data and then we really prove our arguments–

Russ Roberts: As best you can.


Russ Roberts: But–but–the part that’s interesting, to me, is that you have a choice as a farmer. You can often–not always, I assume there’s land productivity issues–but you could choose to grow cassava or you can choose to grow grain. And, the next insight of the paper, which I think is fantastic, is that it’s the gap–it’s the relative productivity of grain versus tubers that’s important. Because if you can grow a lot more grain relative to cassava or potatoes, even though it’s going to get taxed, it’s still worth it. And, that’s a choice that I assume–not always, but sometimes or often–a farmer has to make.

And, that’s fantastic. Because, I mean, that’s economics. It shows you the choice that the farmer has to make. And you presume, which is always a good starting place, that farmers are going to try to do something that’s good for them–as opposed to, say, they have a religious or cultural love of the tuber, or whatever it is, that pretty much this is going to be a central issue.

So, my next question is, first of all, what part of the world can you grow tubers in versus grain? And, what part of the world can you grow both? Is that everywhere? or almost everywhere?

Omer Moav: Yeah. So, there are maps in the paper. Unfortunately, I don’t have them at hand now to show you, but there are very large parts of the world in which only roots and tubers are available. Large parts of the world that only cereals are available. But, large parts of the world in which both are available. [More to come, 20:09]

Rayna Prime

Rayna Prime

Rayna Prime Editor