The gift economy

2009-02-03 00:00

“There is no alternative,” Margaret Thatcher famously quipped, referring to the market economy. With the world’s markets crashing about us, it might be opportune to reflect on an “alternative” economy which embodies values that are seemingly sorely needed in the mainstream market economy.

In his evergreen work, The Gift, Lewis Hyde tells of a strange custom that the English settlers encountered in the New World. When a settler visited an Indian in his home, he might be lucky enough to be given a stone pipe as a present. Later, however, when the Indian returned the visit, the settler soon learnt that custom demanded that he return the pipe. The settlers rather scornfully referred to this custom as “an Indian gift”, but they were probably unaware that they were being initiated into the “gift economy”. This is the antithesis of the “accumulation” economy in which wealth is amassed and held by individuals in sterile vaults. In the gift economy, people either exchange gifts or send them around the community so that everyone has use of them and they eventually return to the original giver.

The rationale of the gift economy is to prevent the unproductive hoarding of wealth by keeping it circulating — and therefore in use — in the community. This not only keeps wealth spread around, but maintains a certain measure of equality and also creates and maintains good human relationships. We don’t have to be 17th- century North Americans to know this. Modern people still exchange gifts at Christmas and this is experienced as being good for family relationships. Gifts create bonds that don’t exist between myself and the check-out woman in the profit-driven economy of the hyper-market.

In the gift economy, social status accrues to the generous giver. This is well illustrated in the contemporary example of Bill Gates, who has moved from being an icon of the profit-driven economy to a modern exemplar of the economy of gift. As the boss of Microsoft he was often envied and reviled. As the head of the Bill and Melissa Gates philanthropic foundation he has had an altogether much gentler, even positive press.

Closer to home, anthropologists have argued that the African custom of lobola is poorly translated as “bride price”. They say that the original idea is that the bridegroom’s family is giving the bride’s family a gift in recognition of the gift of the young woman herself and of her future offspring. In the process good and lasting relations are cemented between the two families and the wealth of the cows moves around the community. Whether this notion is observed in the modern economic context is neither here nor there. The idea and ideal still stand. Few black people will agree that lobola is “buying” a wife.

Hyde suggests that the deepest reason for the existence of the gift economy, and for its continued existence today in little pockets here and there, is the abiding sense that in the end everything is a gift. Hence there is no such thing as a “self-made man” — or woman. Our lives, talents, education, good fortune and determination are all experienced as gifts of God, nature and nurture.

The interesting thing about the case of Gates is that it illustrates that the profit and gift economies are difficult to separate, that there is still a place for both and that they can help each other. Some would argue that the gift economy struggles to survive in large, impersonal societies, because these are too big, diverse and fast-paced to sustain the close human ties required by the gift economy.

However, the gift economy displays a remarkable resilience, toughness and adaptability. Hyde points to examples such as open-source software, sometimes known as “freeware” or academic websites which give full permission to copy and reproduce material (with acknowledgement) for nothing. These examples constitute a direct challenge to the contemporary greedy tendency to extend ever more widely the cold grip of the dead hand of intellectual property rights and to make all commodities marketable.

From the side of the profit economy one can argue that there would be fewer and much smaller gifts available to give away if the market did not produce them in the first place. Also, that in the market economy wealth is not in fact hoarded but rather spread around by investments which can be considered as a kind of gift to wider society, even if the lion’s share of the rewards of the investment accrue to the investor.

Hence it seems that some areas of human activity will always tend to be conducted according to the principles of business and the market, while others will always tend to the economy of gift. At the same time there are always overlaps and these can be mutually enriching. For example, the idea that knowledge or a religious message such as the gospel cannot be sold but must be given away freely persists today. In this area people strive either to give their services freely or at cost price, that is just covering their expenses and taking no profit. This is probably why teachers and clergy are often very poorly paid. They feel that knowledge, including knowledge of God, should be as freely available as possible. In a market-driven world we still feel that the pastor who is coining it is somehow acting inappropriately.

It seems that the more one looks around, the more one notes remnants of the gift economy. No family, for example, charges their children for the many years of education they receive. Upbringing and education are a gift from parents to children, which may or may not be returned by the children by caring for their parents in the frailty and even financial difficulty of their old age.

A final and rather graphic example Hyde proposes is that of blood and body parts. It is felt proper to donate these freely and even when poor people are constrained to sell their blood or organs to wealthy recipients, this is considered understandable but still undesirable and unethical on the part of the rich buyer. This, Hyde argues, is because blood and organs symbolise life, indeed may almost be said to be life, and life is the gift of all gifts and because it is both free and priceless it should not be bought and sold for money.

Perhaps what the banking crash and the mega-scams like Bernard Madoff’s $50 billion rip-off are telling us is something about the importance of human relations and concreteness in economic systems, and how vital these are for humanising them. The sheer abstraction of some of the derivative schemes and the way money became detached from real goods and services as well as from flesh and blood people that traders could actually relate to, seems to have caused those using the money to forget what it was for.

The gift economy suggests that it should represent real, concrete wealth and its raison d’être is to keep that wealth circulating in the community in such a way as to strengthen the bonds that bind that community. And those who facilitate this — unlike contemporary investment bankers — will command the community’s respect.

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