The Breakdown of Co-operation in Paradise: The Rise of Anarchy

The previous chapters looked at the contested nature and types of capital in the Paradise story, and how the agents of the story seemingly behaved as self-interested agents. In the following I analyse in finer detail how self-interested agents became involved in interaction conflict over capital arrangements, and how, in turn, this gave rise to a condition that Buchanan’s constitutional economics may term ‘destructive anarchy’ or Williamson’s institutional economics ‘the contracting dilemma’. Buchanan is explicit: In the strict two-person interaction, enforcement is implemented through the continued threat of having the whole system plunged back into anarchy by any one of the two participants. (Buchanan 1975: 79) Critical biblical research has arrived at comparable insights: Genesis 2–3 in a very subtle and skilful way changes into a ‘corruption story’, and the final state of affairs … reflects … a [partial] return to Chaos. (Slivniak 2003: 455) I contextualize this rise of the anarchic condition through economic interaction theory, which is drawn upon explicitly or implicitly in much institutional and constitutional economics. Specifically, I apply principal-agent theory in this chapter.