a16z Podcast - a16z Podcast: The Why Behind the Weird

Episode Date: October 31, 2017

Author and professor at George Mason University, Peter Leeson describes himself as not just an economist but as a "collector of curiosa." In his latest book, WTF?! An Economic Tour of the Weird, Leeson looks at just that -- the strangest beliefs, superstitions and rituals humankind has engaged in -- and using economics, uncovers the incentives and rational behavior that makes them, well, make a whole lot more sense. In this Halloween Special, Leeson and a16z's Hanne Tidnam dive into the weirdest historical mysteries -- everything from ecclesiastic courts that put rats and rodents on trial, to judicial ordeals that determined guilt or innocence by boiling the accused's hands in cauldrons of hot water, to the economics and laws that governed pirate ships. All these practices, Leeson argues, use superstitions and beliefs like tools: a kind of technology -- in the broadest possible terms.

Hello and welcome to the A16Z podcast. I'm Hannah, and I'm here today with a Halloween special for you, which includes rats, boiling hands and cauldrons, witches, superstitions, pirates, and much more. It's a conversation I had with Peter Leeson, author and economist at George Mason University, who calls himself not just an economist, but a collector of curiosa. In his latest book, Just Out, WTF, An Economic Tour of the Weird, Leeson looks at just that, at all historical weirdness, the strangest practices and rituals that mankind has been engaged in. We discuss how people's beliefs themselves can be used as a kind of technology in the broadest possible terms for producing better social outcomes. Your argument is that what seems like irrational, totally senseless behavior,

some of the stuff that strikes us as the absolute weirdest things that we can imagine happening historically are not at all irrational and weird, that there's all sorts of reasons why they make sense, right? Yeah, exactly. People engage in all kinds of stuff that seems bad shit crazy. But if you examine it through the lens of economics, if you just think about it in terms of basic constraints, you know, the limitations that people confront given their environments and the incentives that the things that they do and the beliefs that they hold and so on have on their behavior, you can begin to see that, you know, what looks really weird, actually, you know, I think makes a lot of sense and is in many ways not so different from

some of the practices and rituals that we take for granted as completely normal today. So, for example, what? What was the weirdest one that you were the most baffled by when you first encountered it? I think the one that caused the most head scratching was the criminal prosecution of insects and rodents in Renaissance, Italy, France, and Switzerland. Wow, that's definitely, that's really weird. Why were they being tried? for what crimes? Well, if they were being tried for having violated the property rights of farmers in these areas, just like contemporary agricultural communities, sometimes they ended up being plagued by, you know, cockroaches or crickets or locusts or rats ravaging their wheat. And so the people

in these communities would basically get together and they would bring a case, you know, for prosecuting whatever the nefarious critters were to the equivalent of like a modern day district attorney. who was sort of in their area. And he would file a legal complaint with the court. And these were ecclesiastic courts, courts that were presided over by members of the church. Is this after they've presumably already tried to get these insects out and they're like, okay, they're not leaving. I need to bring in the law?

This was sort of the last resort pesticide for them. So if you look at Renaissance era or medieval, you go back even further, pest control manuals, basically, you know, sort of pesticide instruction manuals, They display, you know, basically methods that were not very effective. One of the thoughts was that if your fields were ravaged by rats, you should take water that a cat had bathed in and sprinkle it over the fields. Oh, my gosh. Because of some kind of essence of cat, that was the idea. Exactly.

Unsurprisingly, that didn't really do the trick. And so after you tried a couple of these not very effective sort of ordinary remedies, these instruction manuals would suggest you, you know, you ought to consider asking the church. to intervene because the church can get God to use his divine pesticide. Sort it out. So they lot of these complaints. They went to the church and they said, you know, we think these critters are ravaging our crops. Can you please, you know, ask God to basically drive them away? How elaborate a charade was this, this kind of trial?

Would it take weeks or months? I documented several hundred at least. And the trials often lasted long. They certainly would last weeks. they could last many months and how long they lasted depended upon how deep into the charade basically the presiding court was. So the crickets or the rats would be appointed defense counselors, you know, defense lawyers who would represent them. And the cases would be argued in detail, again, often at length. And there would be continuances for the for the critters because

they weren't responding to the summons to appear before the court. Elaborate defenses of the critters would be offered by their lawyers. Such as what? I can't even... Wait, wait. The critters had lawyers, too? Yes, yes. And they didn't just have lawyers. They were appointed as lawyers. Some of what were then considered like the best legal minds in the world, essentially, because these are the most developed parts of the globe during this time.

But what rights did the critters have? They were prosecuted just like they were people. So they had all of the rights that would have attached to a person who had been accused of stealing somebody's crops, for example. If you look at the records here, basically, the trials unfolded just like they would, again, if there were people involved. And this stuff is hysterical. I mean, you have, you have judges basically, you know, giving a continuance to, to against some mice because, you know, cats interfere with them on their way to the trial, or allowing flies to have a continuance because some, the defense counselor had argued that some of the flies were pregnant,

and so it was hard for them to make it. And the court countenanced each of these absolutely posthous claims. So why did this keep going on? I mean, people must have had a sense of humor about it then. Was it working in some way? That's the bringing the logic of economics part to bear. So this is in the period leading up before Protestants emerge on the scene. You've got these, what the church branded as heretics.

During this era, they were called the Waldensians. They were actually pretty ordinary Catholics for the most part, except for the fact that they denied the church's power to excommunicate people and to anathematize people to sort of divinely curse them if people were misbehaving from the church's perspective. Okay. The other thing that they denied was that the church had the right to collect from citizens' tithes. Oh, that's a pretty substantial shift, yes, at that time. Yeah, it was a huge thing because tithes, you know, it's basically a form of taxing your religious population,

and that's how the church earned most of its revenue. So the church did not like this. The church did not like this at all because the way that the church enforced tithe compliance from farmers ordinarily was by threatening to damn them to hell if people didn't pony up essentially. It was really hard to determine if somebody, you know, declared a poor crop harvest that year, whether or not the person was just evading their tiths or they really had just had, you know, a bad weather year, for instance. So one workaround for that is, you know, even though the tithe collector can't determine it, well, God knows everything, right? And so God can determine it. So if we say God is going to punish everybody who is evading tithes, and he always knows if you're evading your tithes,

and you believe that, you're very likely to pay what you owe. Which most people did. Until those damn wall densians came around. And what they started doing was in spreading their message, eroding the citizens, the farmers' faith that the church had the power to actually ask God to divinely condemn them for not paying their tithes and suggested to them that they didn't need to pay. And it also separated a belief from God and a belief that you needed to pay those tithes, right? So you could still do one, but believe the other was not true.

Yep, absolutely. And so the church faces this threat, basically, to its coffers. And what it needs to do is to somehow try and bolster citizens' belief that they, in fact, first of all, they do need to pay their tithes, and secondly, that they do have the power to punish you divinely through God if you don't pay. And that's where the animal trials come in. So at these trials, the punishment, if the species of insect or rodent was convicted, guess what? Anathema and excommunication for the critters.

And so the basic idea is that because the church was using the same punishment on the insects and rodents that were plaguing farmers, that farmers were coming to seek help with ridding, if the church could somehow show that that worked, those threats of divine damnation, worked against the pests, then the citizens might say, hey, you know what, this stuff is real. And if it's real, it's going to work on me too. I better pay my taxes. Exactly. But did it work? I mean, it did. If the farmers come before the court and say, the rats are eating my crops and the church says, okay, we're going to try them. Oh, they're guilty. And now we're going to punish them. In order for the citizens' belief to be bolstered, the rats need to actually leave after the church

basically dams them. Yeah, it all kind of rests on that. I find it hard to believe if the animals aren't even showing up for trial, they're going to listen to the verdict. However, and here's what the key to making it work or making it seem to work was as follows, is that, you know, the thing about insects and rodents is that they're itinerant, right? On a long enough timeline, crickets die or predators drive away mice or for other reasons that have something to do with Mother Nature, they either parish or driven off the property, they move on to plague a different property than the one that they were formally plaguing. As a result of that, by dragging out the trial sufficiently long, the church could basically make sure that it always got the outcome that it wanted.

Whether or not the crops were okay, if you didn't have a good yield, the trial's still ongoing and eventually they leave. The court is waiting for the pest to basically depart so they can claim credit for it because it's the threat of being convicted here that's scary. It's supposed to be driving them away. So if the pests are, you know, pretty obstinate and it's been a few weeks and they're still there eating the farmer's crops. Just draw the trial out. Exactly. Keep dragging it out until eventually they do leave. And when they do, oh, look, miraculously see our trial and our prosecution and our threat of divine damnation was able to drive the pests away, which in turn bolstered the citizen's belief in the church's power to use it against them as tie the faders. So it was really a tool

of the church to get people to continue to believe in the face of argument against those beliefs and pay the money that they wanted them to pay. Yeah, it's a theme that actually kind of runs throughout the book in different scenarios is this idea of using people's beliefs, their superstitions, their scientifically false beliefs, as a technology for achieving some outcome that they want to achieve. Could be tax compliance or could be something else. So it's using the belief itself as a tool, essentially. The belief becomes a tool. the institutions that emerge, in this case, vermin trials, as a way to sort of leverage the belief in order to produce the outcome desired.

In what is a dearth of other tools to do so, right? Like there isn't even the printing press. All those things are not at hand yet. You can kind of think about, in part, beliefs as a substitute technology for the sort of physical technologies that we take for branded in the modern world, many of which, as you point out, historically didn't exist. So naturally, they relied more on beliefs as a form of. of a tool or technology to produce outcomes instead of what we ordinarily think about as technology.

It's so kind of fine-tuned. You know, you sort of have to be very aware of an internal dialogue going on in people's minds and then think about what it will take to manipulate that and be willing to put in a certain amount of subtlety and long-term playing out. Absolutely. And this was definitely a long game because, you know, this criminal prosecution of insects and rodents was occurring over 250 year period. So it was a very long game. By definition, it needed to be a long thing, as you pointed out. Well, I want to get kind of spooky because it's Halloween. But I loved the section about judicial ordeals. And you hear these stories about trial by fire, the witchcraft trials where they would try to drown witches. Can you describe a little bit

what those judicial ordeals were? Those are one of those classic sort of horror story, historical scary things that we just don't get. So even though I think most people probably associate judicial ordeals with donkey witches in water, the heyday of ordeals was actually like a 400-year period between the 9th and the 13th centuries. And during that period, judicial ordeals instead were used not to prosecute sort of more, for the most part, more exotic crimes like witchcraft, but they were used to prosecute accusations of completely traditional ordinary criminality, like somebody stole something from you or somebody committed a murder. They were used to try and find facts to determine the guilt or innocence of the accused in cases involving those

regular crimes. And was it for everything from, you know, pickpocketing to murder? I mean, was it across the spectrum like that? In the similar way that using, you know, vermin trials was a sort of last resort of citizens to drive away pests from their crops. The legal systems, during this period, you know, would try and use ordinary forms of evidence to figure out if a crime had been committed, right? They would first of all ask, were there any witnesses and what do we know about that? The problem is that that doesn't really work well in an era where there aren't like something, there isn't anything even as basic as streetlights to shed some light, literal light on whether or not somebody had stabbed somebody in an alleyway,

so to speak. And you're only relying on word of mouth in a nest of like neighbor relationships and, you know, all sorts of social tangles and resentments and long history. Like, who knows who has what motive and why? Exactly. So they needed a better way to try and figure out if somebody was guilty of the crime of which they had been accused. And their way of doing that, this is, again, conducted by clergy. So it's priests who are doing this. They boiled a pot of water and they threw a stone or a ring into it. And then they asked the accused to plunge his arm and fish the object out of the water. And if his arm was boiled by the water, if it showed signs of having been scalded and burned up, he was considered guilty of the crime.

And if it didn't, he was exonerated. It seems like you'd have a lot of people with boiled arms walking around in a society like this. And that's one of the things that got me thinking, the clue to thinking about the economics, the hidden sort of incentives in this practice, which seems like a totally stupid thing to do, is that you would expect exactly as you say, people walking around with their arms having been boiled. But if you look at the historical evidence, it turns out the overwhelming majority of people who supposedly plunged their arms into boiling water were in fact exonerated. I think a lot of people's intuitions that when you tell them about an ordeal of boiling water is that, oh, it was, you know, it's like torture to basically get people to confess. But if it was torture, it was a pretty damn ineffective torture because it didn't, in fact,

inflict harm on the vast majority of people who underwent it. So what was the reason they weren't getting boiled pants? It goes back again to thinking about beliefs and superstitions in particular as a technology for producing socially superior outcomes, a way of improving society. And it worked like this. So these ordeals were based on a medieval superstition called Judicium Day, which means the judgment of God in Latin. And the idea was that if you were guilty, God would let the boiling water burn you as a way of showing to the court that you had committed the crime. but if you were innocent, he would show that to the court by performing a miracle that prevented the water from boiling you. So if you think about people of this time as having that belief,

thinking that if they're innocent, God won't boil them. If they're guilty, God will boil them and show that they're guilty. You can begin to think about how this would affect an accused criminal's incentive to be willing to undergo the ordeal. So suppose that you believe in this Judiciary Dayy superstition. So if you committed the crime, well, you will, expect that if you plunge your arm into the boiling water, you're going to get boiled to rags. And on top of that, you're going to then be convicted and therefore have to face whatever the punishment is for committing that crime. You could do better by just confessing to your crime right there. At a minimum, you're still going to face the punishment for being convicted,

but at least you won't have your arm boiled to rags on top of it. Right. Might as well take the smaller pain. You're more likely to confess. But think about it if you're innocent. If you know that you didn't commit the crime and you believe in the Judiciary Day's superstition, well, you think that when you put your arm in the water, not only will you not be boiled, no harm will come to you, but the court will now learn the fact that you're innocent. You have the exact reverse incentive than if you're guilty, which is to be willing to plunge your arm into the water. That means that the priests who are conducting the ordeal, know that conditional on observing your willingness when confronted with the option of undergoing your ordeal, your willingness to be willing to do so,

you are probably much more likely to be innocent than guilty. In other words, God doesn't actually, of course, out you, reveal your guilt or innocence. You sort of out yourself by the choice that you make with respect in response to the specter of undergoing the ordeal. It's already apparent by your very choice. But isn't there an incentive to accept your guilt if it's a small crime in those? You know what I mean? Like if I'm like, I wasn't actually guilty of like parking my car here, but I don't want to do, I don't want to go to trial and like risk having my hand boiled off. So I'll just pay the fine. There is potentially if the, if two things are true. One, if the punishments, if the punishment for

crimes is not set optimally. And more importantly, if you don't have full belief in the superstition. So if you have full belief in the superstition, it's always better to undergo it because you know that you're not going to be burned for certain. Because God, right? God's going to intervene to not burn you precisely. And so you'll have no punishment, which is better than even a very small punishment. So as long as you have completely, faith that the ordeal is real. It's not a risk. I see. Yes. You'll still do it. But there is this thing, you know, important thing, which is everybody wasn't a perfect believer, of course, in the Middle Ages. And so what did they need to do about skeptics? Well, and also I wonder about

the belief on the trial side, because the priests who are doing this kind of know, well, the criminal is already out of themselves. We don't need to wait for God to actually boil the water, presumably, right? Now that you're willing to undergo the ordeal, the priest knows that you're probably innocent. But in order to find you innocent, when you stick your arm in the water, for the system to work, the water needs to ultimately not boil you. And the question is, well, how do we achieve that? And the answer is, the priest, since he knows that you're probably innocent, needs to make sure

that the water isn't boiling. And if you look at instruction manuals that priests of this era had for conducting ordeals, what you'll find is a whole bunch of fishy business, where they essentially tell you to do things like, you know, you'll boil the water in private so that nobody can. see, which means you might, in fact, not boil the water at all, right? You sprinkle holy water, in scare quotes, sprinkle over the cauldron before the guy plunges his arm in, which gives you a chance to pour cold water in so that the water isn't actually boiling. A whole bunch of things that they can do to essentially, in fact, they're instructed to do, to manipulate the water

to make sure that it won't, in fact, hurt the person undergoing it. That's what I mean about the belief on that side, because the priests presumably are, you know, believe more than anyone that God is there meeting out justice. But they're then kind of manipulating behind the scenes. How do they reconcile their beliefs with that? It's certainly possible that priests were well aware of the fact that the system was based upon their manipulation and consciously manipulated it. But there's another possibility.

When I talk about this to people, they tend to be very skeptical of that possibility. All that's required for it to work is that priests do manipulate. But that doesn't mean that priests in manipulating the water's temperature, have to believe that they're actually manipulating it. That's the other possibilities that you're turning down the dial on the stove, so to speak, but your arm is being guided by Christ to turn down the dial on the stove. So it's not necessarily incompatible with your faith. That's fascinating.

So is the witchcraft trials different in some way? Or were they another manifestation of this 400 years later? They are quite different. Because of the way the beliefs were being used. There were no pretend stones to sink them. They were all real stones. there was no manipulation. That's right. They're not actually for the most part trying to figure out did they really commit witchcraft. They're mostly just trying to get people to who are being

prosecuted to admit that they're witches. Ordeals are about finding fact when you don't know. They're about doing the same thing that contemporary legal systems do. But witch trials were about basically extorting confessions from people that you wanted to hear. So rather than using an ordeal, what you would do is, well, just torture them. And that's in fact what they typically did. So even though it sort of historically looks like the same kind of trial, it wasn't at all. Let's talk a little bit about superstition, because in this theme of using your beliefs as a kind of early technological tool, how does superstitions work? What are some of the ways in which superstitions behave in this manner? I think about superstitions as just a scientifically false belief. That scientifically false belief could be Judicium-Dade, the idea that God,

intervenes in judicial matters to tell us if somebody's guilty or not. But it could be something that doesn't have any religious component at all to it. For a contemporary example, which is actually closely related to medieval ordeals, polygraph tests, so-called lie detectors, right? Is the science so vague that you could call that a superstition? Totally horseshit. Like astrology, there are people who believe that polygraph tests are actually capable of physiologically measuring whether or not someone is lying or telling the truth. But the scientific community overwhelmingly and correctly rejects them. But doesn't our justice system kind of believe in them? Well, it's a kind of double-sided thing. The reason that in most jurisdictions,

in most, it's not in all, but in most jurisdictions, polygraph evidence is not admissible is because there was a Supreme Court ruling famously that declared essentially lie detector tests are bullshit. And so as a result, we're not going to allow them to be used as evidence in courtrooms. That's why most American courts don't use them. However, American law enforcement, so the CIA, the FBI, the LAPD, they rely on polygraph tests all the time for purposes that are ultimately oftentimes inputs into our judicial system. And the thing about lie detectors is you can't physiologically measure whether or not someone is lying or telling the truth. But the thing is, as long as people believe that they're real, then just like ordeals, they have the power to affect our incentives.

And as a result, the power to be used as a technology to get at the truth ultimately toward the end of improving our criminal justice system or improving truth telling more generally. So it's a performative thing, basically. Yeah, it works just like medieval judicial ordeals do. If you believe that the lie detector test will actually out you, if you're lying, you are less likely to be willing to take it. You're more likely to confess maybe to get a better plea deal by fessing up front than being to undertake it. So if they see that you're willing to take it, they know that maybe a better chance that this guy's telling the truth. And so they then pretend to interpret the squiggly lines to be like, oh, yes, he's certainly telling us true things. So the lines don't matter, jack shit.

It's just the performance of I agree, I don't agree, and everything around that. That is, I think, an economic way of thinking about lie detector tests that is rooted in superstition and incentives and shows that in a way, despite all the centuries that have passed, we face very similar problems to our medieval ancestors, for example, and we actually have pretty similar technologies in the broadest sense of addressing those problems. I want to touch once on pirates if we can, because it is high. Halloween, and you are also known for your work on the economics of pirates. Are there pirate beliefs that function like this, that pirates sort of used as tools of their interactions

or their economic relationships with each other? Early 18th century Caribbean, pirates couldn't rely, obviously, on government to ensure cooperation among them because they were engaged in theft. So they had to figure out a way to rule themselves. There is a perhaps way in which per radical beliefs helped to facilitate that cooperation. Pirates used a form of early constitutional democracy in order to govern their ships. And those constitutions were concerned in large part with constraining the power of pirate leaders, the captain and the quartermaster, important officers on a pirate ship. What was the constituency? Each ship had its own constitution and had its own crew. And when you switch ships and there was a new crew that was formed, a new constitution was formed as well that would

government. Was this happening all the time? New crew. We get a new constitution every time. Yep, which makes sense because these were consensual social contracts. What the rules might need to look like might vary at least a little bit. And what a person would be willing to sign on to might vary as the composition of the crew vary. But most of the problem situations that pirates confronted in engaging in piracy were similar regardless of which captain you were under, regardless of which particular crew you were in, which I think is why it is that the examples of pirate constitutions that we have look very, very similar. There's a sort of template, a pirate constitution template. What kinds of things would be agreed to in those constitutions? Maybe first and foremost, they were employment contracts.

So you would be agreeing to a specific share, which you can think about as sort of the wage scheme, a compensation scheme for the pirates. You know, I'm going to get one share of each prize that we take. That was a key thing that was happening. Another key thing was per radical social insurance, a kind of workman's comp system. You know, if you lost your left arm, your left arm in battle with a potential prize, you would receive out of the crew's common booty that had ceased compensation of a certain number of pieces of eight for that fact. If you lost your right arm, you might get more in social insurance payout, your left eye, your left leg, right leg. Each appendage got its own specific payout, which presumably

reflected the value of those appendages in piratical employment. It was the governing laws of these mini economies. So how did they enforce them? And what was the threat that enforced these beliefs and this compliance with this constitution? Pirates, just like we do, use democracy. So if a captain violated the constitution, the contract with the crew, by overstepping the powers that the crew had granted to him when they set up, the crew could and often did with pirates, vote the rascal out and install a new captain or quartermaster in his place. There doesn't seem to be many cases basically where the captain and resisted because if the whole, if the crew votes to remove you from office, probably not

the captain's best interest to put up a fight. Since we wrote down in our contract ahead of time that we all agreed to that says, this is what it means for him to abuse his power and this is what it does not, this is when he is not abusing his power, now any action he engages in probably is interpreted by us as an overstep or legitimate in the same way. And it's pretty clear, unlike our giant sprawling democracy, that's where this kind of microcosm aspect would be helpful. I love the way that you're not only solving these kind of historical mysteries, like the way we use our human belief as a kind of lever and tool to structure the relationships we want. Thank you so much, Peter. It was such a pleasure having you on the A16Z podcast.

Thank you so much, Hannah.