David Friedman, Poker, and World Peace

Friedmanian anarchism is a phrase I use independently, although I checked and Google reports one prior use in the same manner I intend, here, which is to refer to David Friedman’s approach to and description of anarcho-capitalism. Friedmanian anarchism emphasizes a concept called the discipline of constant dealings to explain how anarchic order can originate and persist sustainably.

I’ll leave the formal proof to him, but the idea is that when people expect that they will have to repeatedly transact with one another then they have a strong incentive to self-enforce their own contracts for efficiency reasons.

I’ll give an example of application of the concept. Then I’m going to talk about an interesting reason that anarcho-capitalism might be more plausible today and in the future compared to yesteryear.

The example is a game of poker. Poker players essentially voluntarily agree to a set of rules. They do have a motive to cheat, and some people do cheat, but most poker games resolve just fine without cheating. There are at least three important reasons most people don’t cheat:

  1. Players don’t cheat because potential earnings over time is maximized by not cheating on sufficiently long time horizons.
  2. Players don’t cheat because of social reasons, which has value in economics.
  3. Players don’t cheat because of the threat of force.

The interesting thing is that if the discipline of constant dealings facilitates ancap exchange then it seems to me that ancap exchange becomes more plausible in society with higher life expectancy. This is because individual actors will be able to grow stronger social bonds and they would also have longer time horizons to earn by proper means which further reduces the incentive to cheat by opportunity cost. Obviously, life expectancy has risen rapidly in recent history and seems to be likely to continue to increase.

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