Sapiens: A Brief History of Humankind
Recorded history only sheds light on a tiny fraction of the human experience
There are many aspects of life where the link between cause and effect is very clear. Humans, as well as many other animals, quickly learn that taking a certain action invariably leads to a predictable and reliable result. For example, just as other animals, we respond to bodily sensations such as hunger or thirst by finding food and water and consuming it. We also learn to interpret all sorts of environmental factors in ways that have been conditioned into our minds. We respond to such stimuli almost automatically.
Daniel Kahneman, in Thinking, Fast and Slow, refers to “system one” thinking as an automatic, fast, and unconscious way of thinking. When we are crossing the street and we hear the sound of screeching tires behind us, adrenaline and cortisol hormones surge in our bodies to alert us to impending danger and we take action automatically in response.
This response is not that different from the reaction that a squirrel might have when it sees a large bird flying above the telephone wire that it is using to get from one tree to another. System one thinking has served us well in myriad settings for all of human history but it also can lead us astray in an increasingly complex society. Human beings, to be successful in our modern world, must increasingly utilize “system two” thinking which is characterized by slow, effortful, conscious, and calculating thought. Danger awaits humans who respond to situations requiring system two thinking with simplistic “gut responses” driven by system one thinking. (For more on Daniel Kahneman, see this review of The Undoing Project by Michael Lewis.)
Economics is the study of how human beings produce, distribute, and consume goods and services. It is considered a social science because the key elements of how an economy works depend on the actions of economic actors rather than laws of nature or the output of a computer algorithm.
The study of how financial markets work is, fundamentally, a subset of the study of economics. However, academics have long attempted to reduce the study of financial markets to overly precise equations more appropriate for a “hard science” like physics. In reality, those who are interested in finance should devote considerable attention to psychology.
Popular books on psychology such as Thinking, Fast and Slow, have improved our understanding of human cognitive errors. However, to really understand human beings, we might want to take a step back and survey the fields of evolution and anthropology. It is in these areas of study that Yuval Noah Harari’s recent book, Sapiens: A Brief History of Humankind, has made a meaningful contribution to our understanding of what makes humans tick.
It is useful to take a step back and consider human history in the context of some very large numbers (the following is a condensed re-statement of the “Timeline of History” included in the book):
Years Before Present Event
13,500,000,000 Matter and energy appear
4,500,000,000 Formation of Earth
3,800,000,000 Emergence of organisms
6,000,000 Last common ancestor of humans and chimpanzees
2,500,000 Evolution of the genus Homo in Africa
500,000 Neanderthals evolve in Europe and Middle East
300,000 Daily usage of fire
200,000 Homo sapiens evolves in East Africa
70,000 Emergence of fictive language
30,000 Extinction of Neanderthals
13,000 Extinction of Homo floresiensis
12,000 Agricultural revolution
5,000 Kingdoms, money, and polytheistic religions
500 Scientific revolution
200 Industrial revolution
What we often perceive to be “long periods of time” are, in fact, nothing but tiny blips on the radar when it comes to overall history. Until 70,000 years ago, human beings were “animals of no significance” according to the author. It isn’t that human beings did not exist prior to 70,000 years ago. Creatures that were very similar to modern humans first appeared about 2,500,000 years ago but they did not stand out from the other animals that shared their habitat. Humans went along, generation after generation, without distinguishing themselves in any particular way and were just part of the overall food chain. However, humans did many of the same things they do today. While humans played, formed various relationships and competed within their social groups, the same was true for other primates such as chimpanzees and baboons, as well as elephants and many other creatures.
Amazing advances took place about 70,000 years ago that allowed Homo sapiens to shoot ahead of other human species and other animals. Prior to that point, sapiens did not have a capability called fictive language. Humans, as well as other animals, had long had the ability to communicate factual information about the here and now. Studies have been done that show that certain monkeys have specific calls that warn about various dangers in surprising detail. For example, there are specific calls that warn about lions and eagles since the necessary response is different in each case. Humans had the capability to communicate about the present but could not conceive of the concept of fiction.
Fictive language involves the ability to use imagination to describe things that are entirely abstract. The concept of religion1, for example, describes a set of beliefs that cannot be observed by ordinary human beings but, nonetheless, allows humans to form a common set of beliefs and customs. Without fictive language, it is difficult for groups larger than about 150 individuals to form a cohesive society because they lack the ability to develop “fictions” that bind together larger populations. The development of the notion of religion and nationality allowed much larger groups of humans to form social bonds. Two humans who meet each other for the first time cannot know how to interact without a common set of underlying beliefs. Just as two Roman Catholics or two Germans meeting for the first time today will already share a lot in common, humans after the cognitive revolution had the ability to understand each other much more fully after the emergence of fictive language.
Until the agricultural revolution, which took place about 12,000 years ago, humans were primarily hunters and gatherers who lived a nomadic lifestyle and did not generally settle in permanent villages or cities. The development and use of “system one” thinking and “fight or flight” instinct was necessary for survival. You and your family or tribe would eat, or not eat, based on the success of your hunting and gathering activities in the very near term. The development of agriculture fundamentally changed human society by making it possible to settle in permanent villages and for some members of a society to engage in activities other than those needed for immediate survival. Agriculture also made it necessary to analyze and plan for the future. In other words, the development of agriculture made it necessary to utilize “system two” thinking – slow, effortful, calculating, and long range in nature.
Take another look at the table above showing key developments in history. 12,000 years seems like a long time to us, but it is less than one-half of one percent of the time since the first humans appeared in Africa 2.5 million years ago and only six percent of the time since Homo sapiens first appeared 200,000 years ago. The vast majority of our time as a species has been spent in hunter/gathered mode where “system one” thinking was paramount for survival. Not only was a refinement of “system two” thinking unnecessary for survival but it would have been a liability. When you see a predator on the horizon, taking immediate action is required and analysis is a liability.
A major problem with the way that most of our minds work is that, in evolutionary terms, we are still basically designed to optimize for conditions that our hunter/gatherer ancestors faced but are largely irrelevant to our modern lives. The acceleration of human advancement through the scientific and industrial revolutions has been remarkable for such a short period of time and change seems to be accelerating even more rapidly than ever before.
Charlie Munger often talks about the psychology of human misjudgment. The study of psychology can help us better understand how human beings think which, in turn, helps us understand how complex social systems operate. The study of economics and financial markets, if done without an underlying understanding of psychology, is destined to be superficial and prone to misunderstanding. As Mr. Munger might say, without an understanding of psychology, you would be like a “one legged man in an ass kicking competition”, compared to those who do have a better understanding.
By reading books such as Sapiens, the reader comes away with an enhanced understanding of how humanity developed over a very long period of time, puts that development into an evolutionary context, and can help to answer why humans tend to think the way they do. It would be folly, however, to think that we ourselves have somehow ascended to a higher intellectual plane simply by understanding these topics. The best we can do is to understand where we came from, what we have evolved to do well, and how we might be prone to making errors. Immunity from such errors is beyond our reach. Some think that we can develop artificial intelligence that is super-rational and reaches an intellectual and decision making plane that surpasses our own. If this ends up being the case, artificial intelligence may end up surpassing humanity and result in our extinction. The author’s new book, Homo Deus, apparently delves further into the question of where we go from here.
The author comes across as somewhat insensitive to religious people when repeatedly describing their beliefs as “fictional”. It seems unnecessary since we can arrive at similar conclusions regarding the development of humanity without dismissing the possibility of humans who had special insights or divine inspiration. Rather than “fictional”, one might prefer to think of language capable of describing abstract, or unobservable, things that cannot be perceived by ordinary humans. The conclusions drawn by the author need not preclude the possibility of religion.