The Rational Optimist: How Prosperity Evolves

Beachcombing east

Barter was the trick that changed the world. To paraphrase H.G. Wells, ‘We had struck our camp forever, and were out upon the roads.’ Having conquered much of Africa by about 80,000 years ago, the modern people did not stop there. Genes tell an almost incredible story. The pattern of variation in the DNA of both mitochondrial and Y chromosomes in all people of non-African origin attests that some time around 65,000 years ago, or not much later, a group of people, numbering just a few hundred in all, left Africa. They probably crossed the narrow southern end of the Red Sea, a channel much narrower then than it is now. They then spread along the south coast of Arabia, hopping over a largely dry Persian Gulf, skirting round India and a then-connected Sri Lanka, moving gradually down through Burma, Malaya and along the coast of a landmass called Sunda in which most of the Indonesian islands were then embedded, until they came to a strait somewhere near Bali. But they did not stop there either. They paddled across at least eight straits, the largest at least forty miles wide, presumably on canoes or rafts, working their way through an archipelago to land, probably around 45,000 years ago, on the continent of Sahul, in which Australia and New Guinea were conjoined.

This great movement from Africa to Australia was not a migration, but an expansion. As bands of people feasted on the coconuts, clams, turtles, fish and birds on one part of the coast and grew fat and numerous, so they would send out pioneers (or exile troublemakers?) to the east in search of new camp sites. Sometimes these emigrants would have to leapfrog others already in possession of the coast by trekking inland or taking to canoes.

Along the way they left tribes of hunter-gatherer descendants, a few of whom survive to this day genetically unmixed with other races. On the Malay Peninsula, forest hunter-gatherers called the Orang Asli (‘original people’) look ‘negrito’ in appearance and prove to have mitochondrial genes that branched off from the African tree about 60,000 years ago. In New Guinea and Australia, too, the genetics tell an unambiguous story of almost complete isolation since the first migration. Most remarkable of all, the native people of the Andaman islands, black-skinned, curly-haired and speaking a language unrelated to any other, have Y-chromosome and mitochondrial genes that diverged from the common ancestor with the rest of humankind 65,000 years ago. At least this is true of the Jarawa tribe on Great Andaman. The North Sentinelese, on the nearby island of North Sentinel, have not volunteered to give blood – at least not their own. As the only hunter-gatherers who still resist ‘contact’, these fine-looking people – strong, slim, fit and stark naked except for a small plant-fibre belt round the waist – usually greet visitors with showers of arrows. Good luck to them.

To reach the Andaman islands (then closer to the Burmese coast, but still out of sight) and Sahul, however, the migrants of 65,000 years ago must have been proficient canoeists. It was in the early 1990s that the African-born zoologist Jonathan Kingdon first suggested that the black skin of many Africans, Australians, Melanesians and ‘negrito’ Asians hinted at a maritime past. For a hunter-gatherer on the African savannah, a very black skin is not needed, as the relatively pale Khoisan and pygmies prove. But out on an exposed reef or beach, or in a fishing canoe, maximum sunscreen is called for. Kingdon believed that the ‘Banda strandlopers’, as he called them, had returned to conquer Africa from Asia, rather than the other way round, but he was ahead of the genetic evidence in coining the idea of an essentially maritime Palaeolithic race.

This remarkable expansion of the human race along the shore of Asia, now known as the ‘beachcomber express’, has left few archaeological traces, but that is because the then coastline is now 200 feet under water. It was a cool, dry time with vast ice sheets in high latitudes and big glaciers on mountain ranges. The interior of many of the continents was inhospitably dry, windy and cold. But the low-lying coasts were dotted with oases of freshwater springs. The low sea level not only exposed more springs, but increased the relative pressure on underground aquifers to discharge near the coast. All along the coast of Asia, the beachcombers would have found fresh water bubbling up and flowing into streams that meandered down to the ocean. The coast is also rich in food if you have the ingenuity to find it, even on desert shores. It made sense to stick to the beach.

The evidence of DNA attests that some of these beachcombers, on reaching India and apparently not before, must have eventually moved inland, because by 40,000 years ago ‘modern’ people were pressing west into Europe and east into what is now China. Abandoning the crowded coast, they resumed their old African ways of hunting game and gathering fruits and roots, becoming gradually more dependent on hunting once more as they inched north into the steppes grazed by herds of mammoths, horses and rhinoceroses. Soon they came across their distant cousins, the descendants of Homo erectus, with whom they last shared an ancestor half a million years before. They got close enough to acquire the latter’s lice to add to their own, so louse genes suggest, and conceivably even close enough to acquire a smattering of their cousins’ genes by interbreeding. But inexorably they rolled back the territory of these Eurasian erectus hominids till the last survivor, of the European cold-adapted sort known as Neanderthal, died with his back to the Strait of Gibraltar about 28,000 years ago. Another 15,000 years saw some of them spilling into the Americas from north-east Asia.

They were very good at wiping out not only their distant cousins, but also much of their prey, something previous hominid species had not managed. The earliest of the great cave painters, working at Chauvet in southern France 32,000 years ago, was almost obsessed with rhinoceroses. A more recent artist, working at Lascaux 15,000 years later, depicted mostly bisons, bulls and horses – rhinoceroses were rare or extinct in Europe by then. At first, modern human beings around the Mediterranean relied mostly on large mammals for meat. They ate small game only if it was slow-moving – tortoises and limpets were popular. Then, gradually and inexorably, starting in the Middle East, they switched their attention to smaller animals, and especially to fast-breeding species, such as rabbits, hares, partridges and smaller gazelles. They gradually stopped eating tortoises. The archaeological record tells this same story at sites in Israel, Turkey and Italy.

The reason for this shift, say Mary Stiner and Steven Kuhn, was that human population densities were growing too high for the slower-reproducing prey such as tortoises, horses and elephants. Only the fast-breeding rabbits, hares and partridges, and for a while gazelles and deer, could cope with such hunting pressure. This trend accelerated about 15,000 years ago as large game and tortoises disappeared from the Mediterranean diet altogether – driven to the brink of extinction by human predation. (A modern parallel: in the Mojave Desert of California, ravens occasionally kill tortoises for food. But only when landfills provided the ravens with ample alternative food and boosted – subsidised – their numbers did the tortoise numbers start to collapse from raven predation. So modern people, subsidised by hare meat, could extinguish mammoths.)

It is rare for a predator to wipe out its prey altogether. In times of prey scarcity, erectus hominids, like other predators, had simply suffered local depopulation; that in turn would have saved the prey from extinction and the hominid numbers could recover in time. But these new people could innovate their way out of trouble; they could shift their niche, so they continued to thrive even as they extinguished their old prey. The last mammoth to be eaten on the Asian plain was probably thought a rare delicacy, a nice change from hare and gazelle stew. As they adjusted their tactics to catch smaller and faster prey, so the moderns developed better weapons, which in turn enabled them to survive at high densities, though at the expense of extinguishing more of the larger and slower-breeding prey. This pattern of shifting from big prey to small as the former were wiped out was characteristic of the new ex-Africans wherever they went. In Australia, almost all larger animal species, from diprotodons to giant kangaroos, became extinct soon after human beings arrived. In the Americas, human arrival coincided with a sudden extinction of the largest, slowest-breeding beasts. Much later in Madagascar and New Zealand mass extinctions of large animals also followed with human colonisation. (Incidentally, given the obsession of ‘show-off’ male hunters with catching the largest beasts with which to buy prestige in the tribe, it is worth reflecting that these mass extinctions owe something to sexual selection.)

Shall we trade?

Meanwhile, the stream of new technologies gathered pace. From around 45,000 years ago, the people of western Eurasia had progressively revolutionised their toolkit. They struck slim, sharp blades from cylindrical rock ‘cores’ – a trick that produces ten times as much cutting edge as the old way of working, but is far harder to pull off. By 34,000 years ago they were making bone points for spears, and by 26,000 they were making needles. Bone spear throwers, or atlatls – which greatly increase the velocity of javelins – appear by 18,000 years ago. Bows and arrows came soon afterwards. ‘Microburin’ borers were used for drilling the holes in needles and beads. Of course, stone tools would have been only a tiny tip of a technological iceberg, dominated by wood, which has long since rotted away. Antler, ivory and bone were just as important. String, made from plant fibres or leather, was almost certainly in use by then to catch fish and rabbits in nets or snares, and to make bags for carrying things in.

Nor was this virtuosity confined to practicalities. As well as bone and ivory, shells, fossil coral, steatite, jet, lignite, hematite, and pyrite were used to make ornaments and objects. A flute made from the bone of a vulture dates from 35,000 years ago at Hohle Fels and a tiny horse, carved from mammoth ivory and worn smooth by being used as a pendant, dates from 32,000 years ago at Vogelherd – both in Germany. By the time of Sungir, an open-air settlement from 28,000 years ago at a spot near the city of Vladimir, north-east of Moscow, people were being buried in clothes decorated with thousands of laboriously carved ivory beads, and even little wheel-shaped bone ornaments had appeared. At Mezherich, in what is now Ukraine, 18,000 years ago, jewellery made of shells from the Black Sea and amber from the Baltic implied trade over hundreds of miles.

This is in striking contrast to the Neanderthals, whose stone tools were virtually always made from raw material available within an hour’s walk of where the tool was used. To me this is a vital clue to why the Neanderthals were still making hand axes, while their African-origin competitors were making ever more types of tool. Without trade, innovation just does not happen. Exchange is to technology as sex is to evolution. It stimulates novelty. The remarkable thing about the moderns of west Asia is not so much the diversity of artefacts as the continual innovation. There is more invention between 80,000 and 20,000 years ago than there had been in the previous million. By today’s standards, it was very slow, but by the standards of Homo erectus it was lightning-fast. And the next ten millennia would see still more innovations: fish hooks, all sorts of implements, domesticated wolves, wheat, figs, sheep, money.

If you are not self-sufficient, but are working for other people, too, then it pays you to spend some time and effort to improve your technology and it pays you to specialise. Suppose, for example, that Adam lives in a grassy steppe where there are herds of reindeer in winter, but some days’ walk away is a coast, where there are fish in summer. He could spend winter hunting, then migrate to the coast to go fishing. But that way he would not only waste time travelling, and probably run a huge risk crossing the territory of another tribe. He would also have to get good at two quite different things.

If, instead, Adam sticks to hunting and then gives some dried meat and reindeer antlers – ideal for fashioning hooks from – to Oz, a coastal fisherman, in exchange for fish, he has achieved the goal of varying his diet in a less tiring or dangerous way. He has also bought an insurance policy. And Oz would be better off, because he could now catch (and spare) more fish. Next Adam realises that instead of giving Oz raw antlers, he can give him pieces of antler already fashioned into hooks. These are easier to transport and fetch a better price in fish. He got the idea when he once went to the trading point and noticed others selling antlers that had already been cut up into easy segments. One day, Oz asks him to make barbed hooks. And Adam suggests that Oz dries or smokes his fish so it lasts longer. Soon Oz brings shells, too, which Adam buys to make jewellery for a young woman he fancies. After a while, depressed by the low price fetched by hooks of even high quality, Adam hits on the idea of tanning some extra hides and bringing those to the trading point, too. Now he finds he is better at making hides than hooks, so he specialises in hides, giving his antlers to somebody from his own tribe in exchange for his hides. And so on, and on and on.

Fanciful, maybe. And no doubt wrong in all sorts of details. But the point is how easy it is to envisage both opportunities for trade among hunter-gatherers – meat for plants, fish for leather, wood for stone, antler for shells – and how easy it is for Stone Age people to discover mutual gains from trade and then to enhance that effect by further specialising and further dividing labour. The extraordinary thing about exchange is that it breeds: the more of it you do, the more of it you can do. And it calls forth innovation.

Which only raises another question: why did economic progress not accelerate towards an industrial revolution there and then? Why was progress so agonisingly slow for so many millennia? The answer, I suspect, lies in the fissile nature of human culture. Human beings have a deep capacity for isolationism, for fragmenting into groups that diverge from each other. In New Guinea, for instance, there are more than 800 languages, some spoken in areas just a few miles across yet as unintelligible to those on either side as French and English. There are still 7,000 languages spoken on earth and the people who speak each one are remarkably resistant to borrowing words, traditions, rituals or tastes from their neighbours. ‘Whereas vertical transmission of cultural traits goes largely unnoticed, horizontal transmission is far more likely to be regarded with suspicion or even indignation,’ say the evolutionary biologists Mark Pagel and Ruth Mace. ‘Cultures, it seems, like to shoot messengers.’ People do their utmost to cut themselves off from the free flow of ideas, technologies and habits, limiting the impact of specialisation and exchange.

Ricardo’s magic trick

Divisions of labour beyond the pair bond had probably been invented in the Upper Palaeolithic. Commenting on the ten thousand mammoth-ivory beads with which the clothing of two 28,000-year-old child corpses at Sungir in Russia were decorated, the anthropologist Ian Tattersall remarks: ‘It’s hardly probable that these young people had made their richly adorned vestments themselves. It’s much more likely that the sheer diversity of material production in their society was the result of the specialisation of individuals in different activities.’ The carvers of mammoth beads at Sungir, the painter of rhinoceroses at Chauvet, the striker of blades from rock cores, the maker of rabbit nets – perhaps these were all specialists, exchanging their labour for that of others. Perhaps there had been different roles within each band of human beings ever since the first emergence of modern people over 100,000 years ago.

It is such a human thing to do, and so obvious an explanation of the thing that needs explaining: the capacity for innovation. Specialisation would lead to expertise, and expertise would lead to improvement. Specialisation would also give the specialist an excuse for investing time in developing a laborious new technique. If you have a single fishing harpoon to make, there’s no sense in building a clever tool for making harpoons first, but if you have to make harpoons for five fishermen, then maybe there is sense and time-saving in first making the harpoon-making tool.

Specialisation would therefore create and increase the opportunities for gains from trade. The more Oz goes fishing, the better he gets at it, so the less time it takes him to catch each fish. The more hooks Adam the reindeer hunter makes, the better he gets at it, so the less time he takes to make each one. So it pays Oz to spend his day fishing and buy his hooks off Adam by giving him some fish. And it pays Adam to spend his day making hooks and get his fish delivered by Oz.

And, wonderfully, this is true even if Oz is better at hook-making than Adam. Suppose Adam is a clumsy fool, who breaks half his hooks, but he is an even clumsier fisherman who cannot throw a line to save his life. Oz, meanwhile, is one of those irritating paragons who can whittle a bone hook with little trouble and always catches lots of fish. Yet it still pays Oz to get his hooks made for him by clumsy Adam. Why? Because with practise Adam has at least become better at making hooks than he is at fishing. It takes him three hours to make a hook, but four hours to catch a fish. Oz takes only an hour to catch a fish, but good as he is he still needs two hours to make a hook. So if each is self-sufficient, then Oz works for three hours (two to make the hook and one to catch the fish), while Adam works for seven hours (three to make the hook and four to catch a fish). If Oz catches two fish and swaps one for a hook from Adam, he only has to work two hours. If Adam makes two hooks and uses one to buy a fish from Oz, he only works for six hours. Both are better off than when they were self-sufficient. Both have gained an hour of leisure time.

I have done nothing here but retell, in Stone Age terms, the notion of comparative advantage as defined by the stockbroker David Ricardo in 1817. He used the example of England trading cloth for Portuguese wine, but the argument is the same:

England may be so circumstanced, that to produce the cloth may require the labour of 100 men for one year; and if she attempted to make the wine, it might require the labour of 120 men for the same time. England would therefore find it in her interest to import wine, and to purchase it by the exportation of cloth. To produce the wine in Portugal, might require only the labour of 80 men for one year, and to produce the cloth in the same country, might require the labour of 90 men for the same time. It would therefore be advantageous for her to export wine in exchange for cloth. This exchange might even take place, notwithstanding that the commodity imported by Portugal could be produced there with less labour than in England.

Ricardo’s law has been called the only proposition in the whole of the social sciences that is both true and surprising. It is such an elegant idea that it is hard to believe that Palaeolithic people took so long to stumble upon it (or economists to define it); hard to understand why other species do not make use of it, too. It is rather baffling that we appear to be the only species that routinely exploits it. Of course, that is not quite right. Evolution has discovered Ricardo’s law and applied it to symbioses, such as the collaboration between alga and fungus that is a lichen plant or the collaboration between a cow and a bacterium in a rumen. Within species, too, there are clear gains from trade between cells of a body, polyps of a coral colony, ants of an ant colony, or mole-rats of a mole-rat colony. The great success of ants and termites – between them they may comprise one-third of all the animal biomass of land animals – is undoubtedly down to their division of labour. Insect social life is built not on increases in the complexity of individual behaviour, ‘but instead on specialization among individuals’. In the leafcutter ants of the Amazon rainforest, colonies may number millions, and workers grow into one of four distinct castes: minors, medias, majors and supermajor. In one species a supermajor (or soldier) may weigh the same as 500 minors.

But the big difference is that in every other species than human beings, the colonies consist of close relatives – even a city of a million ants is really just a huge family. Yet reproduction is the one task that people never delegate to a specialist, let alone a queen. What gave people the chance to exploit gains from trade, without waiting for Mother Nature’s tedious evolutionary crawl, was technology. Equipped with the right tool, a human being can become a soldier or a worker (maybe not a queen), and he can switch between the roles. The more you do something, the better you get at it. A band of hunter-gatherers in west Eurasia, 15,000 years ago, dividing labour not just by gender but by individual as well, would have been formidably more efficient than an undifferentiated band. Imagine, say, 100 people in the band. Some of them make tools, others make clothes, others hunt, others gather. One tiresome bloke insists on prancing around in a deer skull chanting spells and prayers, adding little to the general well-being, but then maybe he is in charge of the lunar calendar so he can tell people when the tides will be lowest for limpet-picking expeditions.