The things we take for granted

Trade can overcome amazing differences between people. Not long ago I was walking towards the Monmartre area of Paris when I decided I was hungry.

There is no shortage of sidewalk cafés in Paris, which is pretty much torture for anyone with a keen sense of opportunity cost. Everything looks good - but I just happened to be walking by this particular café that looked middle-eastern and was attracted by the smell of spices and strong wafts of roasting espresso beans coming out of the door.

As I walked towards the host inside he spoke something very quickly, so I said in French that my French wasn't very practiced and did he speak English, or could he please speak more slowly?

The man said something to me even more quickly with his arms waving, shoulders shrugging... Wow... I didn't think my French was that rusty. We went back and forth like this for a while before a kid walking by said to me in French, "my father doesn't speak French - he's asking you if you can speak any Turkish."

At that point, with some help from our young interpreter, we switched to simple hand signals and soon there were smiles all around. The menu was in French and Turkish, I got the table I wanted, the food was great and the coffee was divine. I tried to tell him I wanted the usual four shots of espresso with some milk and he tossed his head back and made a clucking sound and waved his arms in what I took to be an emphatic “no!” -- which is a good thing, because whatever he gave me in the smaller-than-expected cup practically propelled me up the hill to Sacre Coeur without my legs even moving.

We didn't know each other. We couldn't even communicate verbally. Because we were both trying to serve our own self-interest and knew that to do so we each had to find a way to satisfy the other's, things worked out amazingly well. This, I think, is quite miraculous if one considers the historical context. This notion of becoming better off by having a stranger voluntarily part with a portion of his own wealth through trade seems to be a relatively new phenomenon in the history of mankind. For the majority of our history, the dominant mental model of how one got wealthy was by taking it from others by force. (For many it still is.)

And think of the trust involved in our transaction and all the institutions we take for granted that support it. Without knowing me, without even being able to really communicate with me, this restaurateur accepted a small, flat piece of plastic with writing on it that he couldn't understand as payment for his product and service. I ate his meal and drank his coffee without worrying if I would get sick. I let a stranger in a foreign country walk out of sight with my credit card and assumed I would only be charged for what I received and that he would return it to me.

Economist Paul Seabright calls it the "Great Experiment:" The large scale cooperation and beneficial competition through market processes and the underlying values and institutions that allow it all to work so that strangers can become, essentially, "honorary friends." It is strange to our "someone-must-have-designed-this" minds -- and thus fragile -- because no one is in control. No central authority designs or coordinates it. Indeed, markets are effective precisely because no one has to know anything about them in order to make use of them and unwittingly participate in a process that promotes peace and prosperity.

In his book The Company of Strangers, Seabright concludes: "This experiment is still young, and needs all the help it can get."

Comments

[Brian Wang]

"[W]e switched to simple hand signals and soon there were smiles all around."

A delightful example of yet another spontaneous order: the development of language.

[David McGinnis]

"... pretty much torture for anyone with a keen sense of opportunity cost."

I know and often feel the exact dilemma that you were in, but never could define the root cause so succinctly. Reading your blog actually helped me see myself in a different light. Truly inspiring, thank you.