Recordkeeping Alters Economic History by Promoting Reciprocity
Proceedings of the National Academy of Sciences, Vol. 106, No. 4, pp. 1009-1014, January 27, 2009
Posted: 21 Jan 2009
Date Written: January, 19 2009
We experimentally demonstrate a causal link between recordkeeping and reciprocal exchange. Recordkeeping improves memory of past interactions in a complex exchange environment, which promotes reputation formation and decision coordination. Economies with recordkeeping exhibit a beneficially altered economic history where the risks of exchanging with strangers are substantially lessened. Our findings are consistent with prior assertions that complex and extensive reciprocity requires sophisticated memory to store information on past transactions. We offer fresh insights on this research by scientifically demonstrating that reciprocity can be facilitated by information storage external to the brain. This is consistent with the archaeological record, which suggests that pre-historic transaction records and the invention of writing for recordkeeping were linked to increased complexity in human interaction.
Keywords: accounting, economic institutions, trust, memory, image score
JEL Classification: B25, C91, D80, M40, N00
Suggested Citation: Suggested Citation