Bodhisattva

From issue 2490 of New Scientist magazine, 12 March 2005, page 33

IN THE aftermath of the Indian Ocean tsunami last year, people from the world's richest countries were falling over each other to make donations to help rebuild the lives of the survivors. Perhaps it was the conjunction of this terrible natural disaster with the consumerist orgy of Christmas that spurred so many of us to greater generosity. Whatever the reason, conspicuous donation suddenly became the vogue. Individuals, and even entire countries, competed to see who could send most money to people on the other side of the world whose identity they did not know and who they were highly unlikely ever to meet. What an odd species we are.

Not that Homo sapiens is the only species in which individuals bestow kindness on others. Many mammals, birds, insects and even bacteria do likewise. But their largesse tends to be reserved for their genetic relatives; this makes sense in evolutionary terms, because by helping someone who shares many of your genes you improve the chances of propelling this common DNA into the future. Humans are different, for we cooperate with complete genetic strangers - workmates, neighbours, anonymous people in far-off countries. Why on earth do we do that?

For several decades, researchers have had a possible explanation: apparently selfless acts are nothing of the kind, but are instead a clever way of promoting individual self-interest. When rivals meet again and again, for example, the rewards of cooperation can outweigh the costs of conflict, so getting along pays dividends. Scientists have also come to realise what philanthropists such as Getty and Gates have long known: that altruism does wonders for your reputation (see "Why are we so generous? - below"). But does cooperation always have self-interested roots? Some researchers are starting to have their doubts.

Over the past decade, experiments devised by Ernst Fehr of the University of Zurich in Switzerland, among others, have shown that many people will cooperate with others even when it is absolutely clear they have nothing to gain. A capacity for true altruism seems to be a part of human nature. It is a heartening discovery, yet one that has also touched off a firestorm of debate.

The experiments at the centre of the controversy are as simple as they are illuminating. They ignore theory-based preconceptions about how individuals ought to behave and focus instead on finding out what they actually do when playing games in which there is real money at stake.

One of the most basic of these games is the "ultimatum game". An experimenter gives one of two players some cash, say $20, and asks that person, called the "proposer", to offer a fraction of it to the second player, called the "receiver", whose identity is hidden from the other player. The proposer can offer any amount they choose, from nothing up to the entire $20. The receiver then has the choice of accepting or rejecting the offer. If he or she accepts, the cash is shared according to the original offer. A rejection means that no one gets anything. The game is played just once.

For the receiver, self-interest would seem to dictate accepting the offer no matter how small it is, since getting something is better than getting nothing. Knowing this, a similarly self-interested proposer should offer as little as possible. But over the past decade or so, research on student volunteers has shown that proposers in such experiments typically offer anything from 25 to 50 per cent, while receivers tend to reject offers of less than 25 per cent.

"People reject low offers," says anthropologist Joseph Henrich of Emory University in Atlanta, Georgia, "because they view them as unfair." And through their rejection, they show a willingness to punish the unfair offers even at a cost to themselves.

A vast number of other experiments illustrate the same point. Last year, for example, Fehr and his colleagues had students play a version of the famous prisoner's dilemma game, in which two people can prosper through cooperation but are also given strong incentives to cheat on one another. In this game, if the participants cooperate, each receives a worthwhile monetary pay-off. But either player can get an even higher pay-off by cheating while their opponent cooperates (see Diagram).

In this particular version of the game, the researchers got people to play sequentially: one would go and then the other, fully aware of what the first had done. In theory, anyone thinking only of their own personal gain would always cheat, as this pays more than cooperating. But in the experiments, although many of players who went first did cheat, others cooperated, despite knowing that the second player could sucker them by cheating. What's more, roughly half those who went second rewarded cooperation by treating their opponent fairly, even though that meant forgoing an easy pay-off for themselves (Human Nature, vol 13, p 1). "The facts are clear," Fehr says. "Many people are willing to cooperate and to punish those who don't, even when no gain is possible."

“Many people will cooperate, and punish those who don't, even when no gain is possible”This tendency - which researchers call "strong reciprocity" - throws into question the assumption that apparently selfless behaviour must have some selfish explanation. Across disciplines, researchers now agree that people often act against their own self-interest. "This is the most important empirical work on the human sense of justice in many years," says evolutionary biologist Robert Trivers of Rutgers University in New Jersey.

But when it comes to explaining the origin of our altruism, matters get a whole lot more contentious. In evolutionary terms it is a puzzle because any organism that helps others at its own expense stands at an evolutionary disadvantage. So if many people really are true altruists, as it seems, why haven't greedier, self-seeking competitors wiped them out?

One possibility, Trivers suggests, is that evolution actually is wiping these people out - it just hasn't finished the job yet. He, along with many anthropologists, takes the view that humans evolved to cooperate when our ancestors lived in small, isolated groups of hunter-gatherers. In this setting, they learned through repeated interaction with others that cooperation generally pays because it induces other members of the group to return a favour in the future. Biologists refer to strategic cooperation of this kind as "reciprocal altruism". It cannot directly explain the true altruism found in experiments in which anonymous players meet only once, offering them no hope of future gain. But it is the benefits we gained from reciprocal altruism in our evolutionary past that lead us to behave with "inappropriate" altruism in experiments like Fehr's, Trivers says. "Our brains misfire when presented with a situation to which we have not evolved a response."

Bodhisattva

If Trivers is right, then true altruism is what evolutionary biologists call a "maladaptation". Evolved to respond in a certain way to a given situation, we find it hard to act differently in the changed circumstances of the modern world. That would make strong reciprocity just another in a long list of maladaptations found in modern human behaviour, according to anthropologist John Tooby of the University of California at Santa Barbara. To make his point he gives the example of sexual desire, which most biologists agree evolved to spur the conception of offspring. Today, however, individuals experience sexual desire in many situations in which procreation is clearly impossible, "even when they know the object of their desire is imaginary, or a piece of paper", as Tooby says.

“Any organism that helps others at its own expense stands at an evolutionary disadvantage”Undoubt edly adaptations that evolved to help us cope under specific conditions can backfire when situations change. But not everyone is convinced by the idea that true altruism is such a maladaptation. Henrich disagrees with the theory's central premise. He believes that while our ancestors lived in small, close-knit groups, one-shot interactions with strangers would have been common even then. What's more, these interactions could have been crucial to people's survival, because they would have occurred over shared resources such as water holes and prey animals and, more crucially, in times of catastrophe such as flood or drought. "Environmental shocks would have guaranteed that strangers encountered one another during fitness-critical times," Henrich says.

If both one-shot and repeated interactions were routine in ancestral life, Henrich argues, evolution would presumably have prepared us to distinguish between the two with some precision. And that does seem to be the case. Two years ago economists Simon Gächter of the University of St Gallen in Switzerland and Armin Falk of the University of Bonn, Germany, looked at how people alter the way they play the prisoner's dilemma game depending on whether the game involves one-shot or repeated encounters with others. If people treat one-shot encounters as if they were repeated - as the maladaptation idea suggests - then there shouldn't be a difference. But they found that repeated play more than doubled cooperation levels, indicating that we are fully capable of adapting our behaviour to the situation at hand (The Scandinavian Journal of Economics, vol 104, p 1).

Further support for the idea that strong reciprocity is an adaptation in its own right comes from the theoretical studies of economist Herbert Gintis of the University of Massachusetts, Amherst, anthropologist Robert Boyd of the University of California at Los Angeles, and others. They set up a computer model in which groups of individuals interacted, and watched how their behaviour evolved. Individuals were set up in the model to behave initially either as cheats or as cooperators, and in personal interactions the former came off best. When groups competed with one another, however, cooperation came into its own: groups with more cooperators were likely to flourish.

But that was only the start. The individuals, whether initially cooperators or cheats, were also programmed to copy successful behaviour. In simulations with groups ranging from 4 to 256 individuals, the team found that altruism could evolve. The benefits that cooperation conferred on a group outweighed its costs to individuals - but only in groups of less than about 10. Ancestral human hunter-gatherer bands are thought to have numbered 30 or more individuals, so how could cooperative behaviour have evolved and spread in these groups?

The answer lies in the fact that strong reciprocity is not simply a matter of cooperation; it also requires punishment of those who fail to toe the line. When the team added punishment to their models, they found it made a huge difference. In a second round of simulations, they included a new kind of individual: the "punishers". These punishers were not only willing to cooperate with others but also to punish cheats. By making cheats pay for their antisocial actions, they tipped the balance towards cooperation. This time, competition between groups led to the emergence of cooperation in groups of up to 50 individuals (Proceedings of the National Academy of Sciences, vol 100, p 3531).

Could competition between small groups of our ancestors somehow have turned them into strong reciprocators? Gintis, Boyd and their colleagues believe so. What's more, subsequent research by Fehr, working with economist Urs Fischbacher of the University of Zurich, suggests that as humans came to live in larger groups, their attitudes towards reciprocity may have become even more hard-line. Using a similar model to Gintis and the others (Nature, vol 425, p 785), they found that cooperation can become the default behaviour in large groups provided punishers are willing to punish not only those who cheat, but also those who fail to punish cheats (see Graph). "In this case," Fehr says, "even groups of several hundred individuals can establish cooperation rates of between 70 and 80 per cent."

These findings suggest that true altruism, far from being a maladaptation, may be the key to our species' success by providing the social glue that allowed our ancestors to form strong, resilient groups. It is still crucial for social cohesion in today's very different world. "Something like it had to evolve," Gintis says.

In the absence of further discoveries, it seems likely that the argument over adaptation and maladaptation will continue. But this controversy is not the most important issue, says anthropologist Laurent Keller of the University in Lausanne, Switzerland. "Working out how humans behave is more interesting than whether it is adaptive or not."

Either way, there appears to be something deep within us that drives us to help others - even strangers. And if any of this suggests ways that fund-raisers might appeal to our altruistic tendencies when faced with the next humanitarian crisis, surely that is all to the good.

http://www.newscientist.com/article....mg18524901.600

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Bodhisattva

By Robert Lee Hotz Times Staff Writer

HOUSTON — The two women had money in mind.

Phuong Tang, 25, wriggled into a $2.5-million brain scanner at Baylor College of Medicine. Across the hall, a technician loaded Tang's trading partner for the day — Kavita Belur, 26 — into the bore of a similar machine, like a fresh artillery shell.

The two strangers were speculators in a marketplace of the mind, locked in a mutual struggle for financial gain. Belur played an investor, Tang the trustee of an investment fund.

As the pair wavered between cooperation and betrayal, scientists recorded how their brains changed. The researchers hoped to discover the secret of trust — the human variable missing from the mathematics of modern economics.

The terms of the experiment were simple: At the beginning of each round, Belur could put up to $20 in play. Any investment automatically tripled. Tang then decided how much to return and how much to keep.

Belur's safest strategy was to hoard all of her money. Tang's most logical move was to cheat her partner at every opportunity.

There was a riskier but potentially more profitable way.

They could trust each other.

The experiment was part of a new frontier in the exploration of the brain — a field called neuro- economics that seeks to understand the biology underlying economic behavior.

In universities and research centers across the country, scientists are probing the brain with coin flips, $5 bills and gift certificates from Amazon.com. Bit by bit, they are assembling a mosaic of the financial brain, identifying how competing neural circuits shape decisions.

"We have started looking for pieces of economic theory in the brain," said New York University neuroscientist Paul Glimcher.

Researchers believe they can discover how neural networks affect the ways people buy and sell, splurge and save. They hope one day to understand how decisions percolating through the brains of billions of people, often acting at cross-purposes, interact to chart the course of financial markets and national economies.

Inside the scanner, Belur made up her mind.

She decided to gamble her entire nest egg on her trustee's goodwill.

She pushed the button, putting her money in play.

With the ritual clang of the opening bell one day in February, the five trading floors of the New York Stock Exchange (news - web sites) abruptly surged in a whirlpool of profit and loss.

Hundreds of brokers waved cellphones, fingered small computer keypads and placed their clients' orders. Fortunes winked into existence and just as quickly vanished.



In all, about 1.6 billion shares — worth about $46 billion — changed hands during the day in a ripple of deals coursing through the global equities market. The daily behavior of buyers and sellers is so complex that even experts in chaos theory have been unable to discern a predictable pattern.

In virtually every area of markets, human behavior has economists stumped.

"We don't know why stock prices go up and down," said Caltech economist Colin Camerer. "We don't know why savings rates are so dramatically different in different parts of the world. We don't know why there is labor market discrimination."

People trust other people when economic theory says they should not. They cooperate when betrayal seems more rational. They gamble foolishly, overestimating risk when they are losing, and underestimating it when they are winning. They spend too much and save too little.

Economists know all this from personal experience, but they don't know how to factor the quirks of human behavior into their mathematical models. This is no small matter. Efforts to set interest rates, revamp health insurance, privatize Social Security (news - web sites), revise pensions, police the sale of securities and alter legal liability rules rely to some degree on economists' ability to make reliable predictions about the choices people will make.

"Economics has hit the wall," said Andrew Lo, director of MIT's laboratory for financial engineering. "It has explained about as much as it can with the tools it has. There are too many inconsistencies between theory and data."

Pioneers in neuroeconomics believe the key to understanding economic behavior lies deep in the brain, at the level of cells and synapses.

The brain is above all an economic engine forged by evolution through eons of scrounging for scarce resources, they argue. So the ability to trade things of value is the defining characteristic of the brain, the keystone of human character.

"Trade preceded agriculture; it preceded cities; it is a major component in human sociality. More than anything, it explains our success as a species," said Vernon Smith, an economist at George Mason University whose work in experimental economics earned him a Nobel Prize in 2002.

Some experts suggest that stock markets and other financial exchanges, as creations of the human intellect, may mirror the biological networks in the brain.

If only they can understand the brain, researchers believe, the mysteries of markets will be revealed.

Inside her scanner at Baylor, Tang made up her mind.

She signaled her decision with a tap of a button.

As the trustee, she had chosen cooperation. She split the proceeds of her partner's first investment evenly.

Isolated in the neighboring scanner, tracking her partner's decisions via icons on a computer screen, Belur had no way to know whether that choice was sincere or simply a strategy to encourage further investment until the odds would shift in favor of betrayal.

Even so, Belur gambled. On the next round, she once more invested everything she had.

Again, her faith was repaid. Tang shared the profits equally.

Tang, who was working on her doctorate in human genetics at Baylor, was drawn to the experiment not by scientific interest in its outcome, but by the spending money she could earn as a volunteer. She had carefully planned how to win as much as possible in the experiment.

"I had a strategy," Tang explained later. "If she was nice to me, I would be nice to her. At the very last round, I would betray her."

A team of researchers led by Read Montague, director of Baylor's Human Neuroimaging Laboratory, and Baylor neuroscientist Brooks King-Casas scrutinized the synapses of both women for cellular evidence of the relationship building up between them.

The researchers used technology developed at Baylor that allows scientists to monitor two or more brains simultaneously using functional magnetic resonance imagers linked through the Internet.

For the trust experiment, funded by the Brown Foundation Inc. in Houston, the researchers often paired a volunteer in a brain scanner at Baylor with one at Caltech, more than 1,300 miles away. The researchers at Baylor and Caltech have conducted the experiment with 144 people — the largest interactive brain-imaging study ever.

So little is known about the biology of decision-making that researchers had no theory to test. They wanted to gather as much data as possible during the financial interactions in the hope that signatures of brain activity might emerge.

"In this game, trust builds up, and it must exist somewhere in the brain," said Caltech neuroscientist Cedric Anen. "But there is not one event where we can say, 'That is trust.' We don't know when it starts, how it builds up or what is involved."

The results, so far unpublished, reveal that financial dealings seem to engage neural networks in the cingulate cortex, an area of the brain involved in switching between tasks, monitoring errors and short-term memory.

In sprays of light on a computer screen, the researchers could see how levels of activity shifted. Men typically showed the greatest activity in the seconds before making an investment decision, women in the moments before they revealed their decision to their trading partner.

In Belur's and Tang's paired brains, the offers and counter- offers — signaled by pushing buttons inside their linked scanners — triggered heightened activity along a crescent-shaped strip of brain tissue in the cingulate that appears to track responsibility for social interaction.

With each round of negotiations between the two women, a reputation for fair dealing took hold in their neural tissues.

"Trust is one of those few notions that underlies everything from individuals making decisions together to huge policy questions between nations," said Steve Quartz, director of Caltech's social cognitive neuroscience laboratory. "For a long time, we thought this was a state beyond measurement.

"The brain scanner is beginning now to put a yardstick up against it, to provide a measure for it."

In deconstructing the biology of trust, other researchers have determined that the brain appears to prize that bond between two people biochemically, secreting a powerful hormone to cement working relationships.

The act of trust correlates with elevated levels of a brain hormone called oxytocin, the same chemical released during breast-feeding and uterine contractions, according to experiments done by researchers at Claremont Graduate University.

"It literally feels good to cooperate," said Paul J. Zak, director of the Center for Neuroeconomics Studies at Claremont. As the hormone level rose, people also were more likely to reciprocate trust. "The stronger the trust, the more the oxytocin went up, and the more trustworthy you were.

Bodhisattva

"Interestingly, participants in this experiment were unable to articulate why they behaved the way they did," Zak said. "But nonetheless their brains guided them to behave in 'socially desirable' ways — that is, to be trustworthy."

Inside the Baylor scanner, Belur invested another $20.

She signaled her decision, then awaited Tang's next move.

Was trust its own reward?

When a decision forms, the brain moves faster than self-awareness.

The brain unconsciously prepares to act a measurable length of time — up to 500 milliseconds — before a person consciously decides to act.

In other words, the brain is always one step ahead of itself, calculating the potential costs and benefits of each choice at a cellular level.

"Most of the brain is dominated by automatic processes, rather than deliberative [thinking]. A lot of what happens in the brain is emotional, not cognitive," said George Loewenstein, a behavioral economist at Carnegie Mellon University.

Some brain cells are especially sensitive to the potential rewards of decisions, research at Baylor and Emory University suggests.

Brain cells that release a chemical called dopamine, which serves as a reward to reinforce behavior, actually anticipate snap decisions to help balance costs and payoffs. The cells secrete a burst of good feeling beforehand to underline the desirability of one course of action versus another.

These neurons respond selectively. Some react only to the possibility of something beneficial and others only to the reward itself, researchers at the University of Fribourg in Switzerland discovered.

Every brain is of two minds about the future.

Two competing neural systems interact during choices that hinge on a conflict between short-term and long-term benefits, Harvard University researchers reported.

"Our emotional brain has a hard time imagining the future, even though our logical brain clearly sees the future consequences of our current actions," said Harvard economist David Laibson. "Our emotional brain wants to max out the credit card, even though our logical brain knows we should save for retirement."

Moral dilemmas can engage the same sense of fair dealing and mutual obligation as money matters. Researchers at Princeton University determined that synapses active during complex moral choices tapped into areas associated with rational thinking — and also into regions aroused by strong emotion.

"Some of that emotional architecture affects decisions we make involving money," Zak said.

Critics have often argued that volunteers playing experimental games in brain scanners are no measure of real market behavior. So researchers led by Lo at MIT studied working traders during their normal business day.

To measure brain activity indirectly, he wired 10 currency speculators at a Boston brokerage to sensors monitoring heart rate, breathing, blood pressure, body temperature and skin conductivity. By the end of the day, the traders had made 1,200 split-second trades, averaging $3 million to $5 million apiece.

His team plotted the biological indicators of stress, exuberance and tension against real-time profit and loss. He repeated the experiment at the Boston Stock Exchange.

Market trades, the sensors showed, were the stuff of sweaty palms, heavy breathing and pounding pulses. Snap judgments, honed by intuition, outweighed high-minded economic calculations.

These were "gut" decisions.

Contrary to traditional economics — which considers only rational deliberation — such measures of market panic and exultation begin to document how involuntary emotions affect the rise and fall of stocks.

Already, preliminary findings about the balance sheet of the brain have scholars rethinking the meaning of money itself.

The same reward circuitry activated by cocaine, sports cars, attractive faces and jokes is activated by money. Until now, economists have assumed that money was prized not for itself but only for what it could buy.

Moreover, the prospect of winning money activates specific brain regions in a way that the threat of losing it does not, researchers at Stanford University recently demonstrated.

Scientists are not sure how the electrical snap of synapses adds up to a financial decision, or how these insights might be assembled into a working theory of economic behavior.

"Sooner or later, you have to engage the issue of free will," said Glimcher, the New York University scientist. "When we finally understand the human brain, all human behavior will be predictable."

For nine rounds, the two women played in perfect trust.

Belur as the investor always put up the maximum possible. Tang, the trustee, in turn always equally divided the spoils.

Now, in the last round, the odds of betrayal reached their peak.

They had both reached the moment when economic theory suggested that the optimal move was for the trustee to seize all the profits because there would no longer be any way for the investor to retaliate.

Tang could cheat her partner without fear of reprisal.

The most rational move for Belur, therefore, was to refuse to risk any money in this last round, to end the game richer than her trading partner.

The women balanced on the cusp of betrayal.

Belur gambled again and put her entire stake in play.

The next 10 seconds of indecision seemed an eternity.

For one last time, Tang evenly split the proceeds of the investment.

"Perfect cooperation every round," said Baylor neuroscientist Damon Tomlin, who was monitoring the experiment from the control room.

The two women eased themselves out of the scanners, stiff and a bit dazed.

Unknowingly, they had defied the rules of game theory. They should have betrayed each other at the earliest opportunity. Had trust hormones triumphed over the theorem of self-interest?

By playing together in such harmony, each had earned 300 points, meaning each would be paid $30.

Tomlin counted out the one-dollar bills from a small lock box.

Tang eyed the growing stack of bills.

"If I had known it was the last round," she told Belur, "I would not have given you anything."

Tang could not explain why she lost track of her strategy, and it puzzled her.

There was no way she could know whether — in the instant of decision — the internal compass of her brain had altered her choice.

http://story.news.yahoo.com/news?tmp...yofgiveandtake

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