---
title: "Bioeconomics: How Biology Solved Economics Billions of Years Ago"
description: "Though not immediately evident, the disciplines of biology and economics are essentially the same. Both are concerned with investigating how living organisms arrange themselves to produce, consume, and allocate resources in a world of scarcity."
date: "February 19, 2023"
author: "Alex Younger, alex@alextheyounger.me"
original-source: "Exported from Substack.com on September 13, 2023."
category: science
image: "https://substack-post-media.s3.amazonaws.com/public/images/23002237-966f-452f-8b43-fa51a4163ff0_1920x1200.jpeg"
---

# Bioeconomics: How Biology Solved Economics Billions of Years Ago

![[TheDigitalArtist](https://pixabay.com/users/thedigitalartist-202249/)](https://substack-post-media.s3.amazonaws.com/public/images/23002237-966f-452f-8b43-fa51a4163ff0_1920x1200.jpeg)

Though not immediately evident, the disciplines of biology and economics
are essentially the same. Both are concerned with investigating how
living organisms arrange themselves to produce, consume, and allocate
resources in a world of scarcity.

There may be limits to what we can learn from brainless microbes; no
microbiome will enlighten us on a theory of interest rates, or any other
strictly human invention.\
\
But a substantial portion of economics is devoted to the examination of
information systems. It is here that biology has recorded vast, ancient
registers of knowledge for us.

### Biology as an Information System

Of particular interest to us is the role of *planning* in an economy.
This is the never-ending debate of which resources, if any, should be
managed by a central government authority. As we will see, this is a
peculiar human convention.

In biology, there is no complex organism that is managed in a top-down
manner.

We will often describe the body in an authoritarian convention when we
say things like \"*the brain controls the arm,*\" but, taken literally,
this couldn\'t be further from the truth. It is far more accurate to say
that nothing is really under control.

### As Above, So Below

A quick tangent about complexity may be helpful here.

Stock markets are a fantastic example of complexity, and perhaps the
best way to visualize how our universe works.

On the day to day, stock price fluctuations are fundamentally
unpredictable and chaotic, seeming to move in no general trend. When you
zoom out of this day to day chaos, you find a spontaneous order in the
noise, a trend moving in a general direction.

In the same way, the physical laws of nature are the result of zillions
of particles which, alone operate in ways we don\'t comprehend, but on
the whole, create trends in a general direction that give us phenomenon
like heat and electricity. This is the basics of statistical mechanics.

If this fact were fully appreciated, we might hesitate in calling any
physical phenomenon \"*constants*,\" as everything will fluctuate at the
microscopic level. There is no clear reason why they must remain
constant or why they cannot be influenced by other factors.

I bring up this tangent because all of biology works in the same way. We
can forgive ourselves when we say \"*the brain controls the arm*\" due
to sheer practicality of language, only if we appreciate that the
mechanism for which a brain moves an arm is an emergent phenomenon - a
bubbling-upwards, rather than a top-down command.

Descartes has famously compared the human body to a machine, but he
truly struggled to understand how the body could function like any
machine he'd ever seen, given that humans never recite a fixed output
given a fixed input. Descartes was surrounded by simple, rigid machines
in his day, but he struggled to fully conceptualize an internet, and how
complexity creates far more varied responses.

The process for how the arm is moved is not a straightforward, yes or no
response from the brain, but unimaginably massive debate between various
sections of the brain, to which the average conclusion is the ultimate
movement of the arm. This is how we can [predict basic human decisions
11 seconds](https://www.nature.com/articles/s41598-019-39813-y) before
the decision reaches consciousness.

### Mass Coincidence of Wants

In economics, there is a concept called the *double-coincidence of
wants,* which describes two people who realize they can mutually benefit
by exchanging goods or services. Every complex organism might be seen as
an absolutely *massive* coincidence of wants.

In biology there is a very similar concept called *biological
mutualism*, the classic example being the clownfish and the anemone.

In microbiology it is often referred to as *symbiosis*.

The beauty of these ideas is that organisms can help each other while
helping themselves, and even create a more complex system that benefits
the whole  -  and mind you, all of this is happening without any
organism "caring" for any other, or without even being conscious of
other organisms. They happened upon a configuration that made sense for
the largest numbers of organisms.

Humans are perhaps the first creature to recognize this phenomenon, and
can purposefully act in this way. We are the first to consciously learn
that we can help ourselves by helping others, and created systems that
expedite this process. It is this alone, this purposeful social
cooperation, that has catapulted humanity to wealth and prosperity
never-before seen by any other animal.

### Fatal Problems of Top-Down Organization

Human beings have the peculiar case of intelligence, and this leads them
to assume that they could potentially engineer a system that is far more
practical than what nature could provide.

We have seen this assumption in the various forms of socialism. The
proponents of these ideas, they believe that individuals are generally
uninformed or incapable of making rational decisions for themselves, and
we might could collectively make better decisions by outsourcing the
burden of decision-making to a select few, ideally elite human beings.

But this is confusion. No matter how intelligent the select few, it has
never made sense to place the power to solve complex problems into the
hands of fewer people.

Greater decentralization ultimately allows for a more complex organism.
It is then no coincidence that every attempt to manage our economic
system in a top-down manner leads to an eventual breakdown of the
system.

The failure of socialism is not a failure of human nature or of greed,
as it is so widely cited. It is quite clearly a fatal flaw in the logic
and the capability of the socialist information system.

This has been called the *[Economic Calculation Problem](https://en.wikipedia.org/wiki/Economic_calculation_problem)*,
and some variation of the problem will exist in every case a state
subverts market prices. No market transaction is involved in the state
redistribution of resources and no accurate information about how this
transfer affects the supply and demand can be obtained.

Many socialists have recognized that this is an actual problem, and
attempted to resolve it by stating a market could be simulated alongside
socialism with supercomputers. To say this is infeasible is an
understatement, it's metaphysically impossible.

It is impossible to \"solve the market,\" no matter how advanced the
algorithm. A market is a continuously adaptive system, where even the
predictions about the market will influence the state of the market.
It's an infinite recursion loop that cannot be resolved. I have written
much more on this idea in [this piece](/blog/philosophy/the-impossibility-of-predicting-the).


The market economy allows all actors within the system to determine
where resources are allocated just through every day buying and selling.
A natural selection process takes place that (*over the long run*)
chooses the businesses that create the most value within the system. It
should theoretically evolve by the same mechanisms that life evolve.

Whether or not this system is *perfect* is debatable in the same way
that we might debate whether evolution of life is perfect. Though there
are times I am tempted to throw my arms up in the air and scream the
universe is broken, I cannot conceive of something that contains more
information about the universe than the universe itself. In the same way
I cannot conceive of a system that contains more information about the
market than all the actors within the market. I will refer you to
[efficient market hypothesis](https://en.wikipedia.org/wiki/Efficient-market_hypothesis)
and let you decide for yourself.

What is for certain is that the socialist system attempts to remove
itself from this natural evolutionary feedback system, and restricts
market decisions to state bureaucrats. In this way, the system
necessarily loses the primary metric that guides the selection of
enterprise: profit and loss. This is the goal of socialism of course,
the socialists believe the concept of profit and loss to be primitive,
brutish and greedy; to which they would prefer far more enlightened,
conscious metrics.

Whatever metrics they decide will be arbitrary, constrained and very
likely to not represent the macro goals of the market. They are certain
to be more aligned with the priorities and preferences of the state
managers. It is without question that the Soviets made considerable
advancements in rocket science, space travel, and even sports science,
but they did so at the expense of basic necessities like food.

This is not a distant, historical hypothetical limited to completely
socialist systems, but a problem you experience today in your everyday
life, in whatever country you live.

How do police departments, which are nearly always state-run, determine
if they're doing a good job? How do they determine if they're using
their resources effectively? The amount of tickets they issue? The
amount of revenue they extract from the public? The number of complaints
they get?

The question is really up for debate, and likely differs by each
department. One thing is for sure, their metrics need not be influenced
by the citizens they're meant to protect.

### New Life

Our economy can be seen as the beginnings of an even more complex
organism, where every cell is a complex conscious creature. This complex
organism is only possible through increased decentralization of
knowledge and decisions, as nature has made clear to us.

It has been said that social media sites like Twitter can act like a
collective brain, and this comparison is surprisingly accurate. You may
view trending topics differently knowing that is exactly how thoughts
occur in our own brain.

And what of AI?...