Narrow self-interest does not automatically produce efficient exchange

Evidence

If, in the poem of Chamisso, the highwayman with pistol drawn compels the victim to sell his watch and ring for three coppers, the fact is that under the circumstances, since the victim could not otherwise save his life, the thing obtained in exchange is actually worth the price. No one would work for starvation wages if, in the situation in which he actually found himself, he did not prefer this wage to not working. — Georg Simmel, on individuality and social forms_…, 255 (#contradicts, via linked claim)

Categorization

• XREF: connects to: Markets can organize exchange without requiring high levels of trust; Mere incentive compatibility is insufficient for trust as encapsulated interest; Mutual trust in iterated exchange is selffulfilling through aligned incentives (+11 more)

Related

• Every exchange is individually advantageous given its actual circumstances (similarity 0.83)

Broader Connections

• Egoistic micro-motivation lacks momentum across cases of cooperation #corroborates (0.88)
• Mere incentive compatibility is insufficient for trust as encapsulated interest #expands (0.85)
• Every exchange is individually advantageous given its actual circumstances #contradicts (0.85) — Georg Simmel, on individuality and social forms_…, 255
• Egoistic motivations alone cannot sustain cooperation without plausible self-regulating structures #corroborates (0.82)
• Mutual trust in iterated exchange is selffulfilling through aligned incentives #qualifies (0.80)
• Reciprocity motivations can be self-reinforcing where further interactions are plentiful #qualifies (0.78)