What can we learn from developing societies around the world about mitigating risk and sharing resources during a disaster?
When disasters happen, we often have to rely on others to help us get through. In our modern world, many of us rely on commercial insurance that we buy through the market to manage our risk. But managing risk is an ancient human practice — one that has roots going far back in our evolutionary history. We can catch a glimpse of these fundamentally human risk management strategies by looking at small-scale societies around the world.
In a recent paper published by Associate Professor Athena Aktipis and Professor Lee Cronk from Rutgers in Nature Human Behavior, they explain how small-scale societies around the world pool risk, and they describe the seven principles that characterize successful risk pooling systems. In their new paper, “Design principles for risk-pooling systems,” Aktipis and Cronk show how these principles make it possible for people to help one another in times of disaster outside of commercial insurance or expectations that one will be paid back for help given.
The authors were inspired by the Nobel Prize-winning research on resource pooling done by former ASU Research Professor Elinor Ostrom, who showed that in many societies around the world, people are able to avoid the tragedy of the commons when people follow eight design principles for how to collectively manage common-pool resources. The tragedy of the commons is a situation that when people have access to shared common resources, they tend to act selfishly and deplete those resources. In this paper, Aktipis and Cronk describe seven design principles that allow for greater resilience to disasters through helping others in times of need without requiring traditional “reciprocity” mechanisms.
Risk management and resource pooling is a core component of commercial insurance and the current health care system employed around the world. Resource pooling is the act of a large group of people sharing resources like money for an eventual larger common goal or expense, similar to a monthly insurance premium or a homeowner’s association fee. Additionally, risk management, or the behaviors used to reduce risk, like wearing a seatbelt while driving, is part of any preparedness strategy such as the fight against COVID-19 and future pandemics.
“Humans have had to deal with risk throughout our whole evolutionary history, and we have a few different management strategies, but it really hasn’t been investigated from an evolutionary perspective. It is an unexplored aspect of human nature – how do we manage risk when things go wrong?” said Aktipis.
Aktipis and Cronk are principal investigators of the Human Generosity Project, where they conduct research on cooperation and systems among communities across the world, including the Osotua system of the Maasai tribes in Africa, Fijian fisher horticulturalists and American ranchers in the Southwest. In each of the 12 societies they have investigated over the last decade, they found consistent principles that were needed in order to have group success in times of tragedy and disaster.
The seven principles of successful risk pooling systems are:
- An agreement that the resources are for unpredictable events.
- That giving shouldn’t create an obligation for reparation.
- Participants shouldn’t be expected to help others until their own needs are met.
- Everyone agrees with what constitutes need.
- That resources are shared transparently to reduce cheating.
- Everyone has the choice about who to help.
- The systems are large enough to cover the scale of risks.
When these principles are met, resource pooling is effective and populations succeed more than in reparation-based systems.
“A lot of human risk strategies are really entwined with cultural norms, environment, communication and coordination among groups,” said Aktipis.
When it comes to dealing with unpredictable and unexpected risks, people often help each other without expecting things in return, and often will only ask for help when they are actually in need.
“If we look across human society, that is just how people behave when there are these unpredictable and unexpected situations, like a pandemic,” said Aktipis.
The dominant model for helping among non-kin in evolutionary psychology has been account-keeping reciprocity, or the idea that when you share resources with someone else, you are keeping a record of those resources and expect repayment in some form in the future.
However, according to Aktipis, that isn’t the only way societal cooperation can be stable.
“If people’s fates are connected or there is interdependence for survival, we find that there are survival advantages to need-based transfer over the traditional model of reciprocity,” said Aktipis.
Expanding from small-scale societies to larger countries, the principles in the model still hold true.
One caveat, however, was that when the problem was something that was consistent and predictable — such as branding times in the ranching community — people were less likely to help without expecting something in return. If the situation was unpredictable, however, such as a hurricane or unexpected injury, those same communities would help without expecting to get paid back for that help.
“The principle that the scale of the network needs to be appropriate for the scale of the risks is a huge issue that we face today in our modern financial and insurance systems,” said Aktipis. “They are interdependent in a negative way – that when there is a problem we face systemic failure.”
Aktipis and Cronk argue that the pandemic highlighted the weaknesses in our risk management strategies, sharing an opportunity for us to shore up our vulnerabilities and improve our systems so they are better prepared for future disasters.
“We might be able to create Osotua-like need-based transfer relationships between not just people but also between institutions. And this could really help us to better manage risks in the future and to deal with the fallout that comes with unpredicted events,” said Aktipis.