An Evolutionary Perspective on Socialism
Modern life makes it easy to forget the world in which we evolved (the EEA—Environment of our Evolutionary Adaptedness). Most people in developed societies live at a considerable distance from predation, starvation, and violent death. We can simply buy food without giving much thought to the possibility of starvation, let alone the struggle required to stay alive through most of human history. The institutions that protect us from once-routine dangers work so well that we can lose sight of why we need them. From this comfortable distance, it is tempting to regard competition or scarcity as artificial products of defective social systems. If only society were organized more rationally or compassionately, perhaps these disagreeable features of existence could finally be eliminated.
Anyone who has seriously studied the natural world knows otherwise. Life is a continuing contest for limited resources. Organisms compete for resources such as food, water, territory, shelter, and status, as well as mates and opportunities to reproduce. Predation is routine and disease pervasive. Death is one of the defining features of the natural order, and most organisms that have lived left no descendants. That, of course, does not mean that nature supplies a moral code. Disease, for example, is natural, yet we devote enormous effort to preventing and treating it. The same distinction applies to social life: recognizing that competition is part of our evolutionary inheritance does not oblige us to celebrate its cruelties. It does, however, mean that political institutions must be designed for the organisms we actually are.
Yet competition presents an apparent evolutionary puzzle. Human beings do not merely compete. We also cooperate, on a scale unmatched by any other animal. In today’s world, millions of strangers collaborate every day without meeting, speaking, or even knowing of one another’s existence. Are we therefore self-centered or cooperative? The research suggests that the question poses a false choice.
Why We Cooperate
Humans possess both cooperative and self-protective dispositions. We can display generosity, loyalty, and a willingness to punish unfairness, although such displays may also serve strategic purposes. In The Prince, Machiavelli famously observed that appearing merciful and upright can be politically useful even when those appearances do not fully reflect a person’s conduct. More generally, human behavior is sensitive to many incentives and expectations, reputational pressures, one’s group membership, and even the conduct of other people. A small number of defectors, for example, can induce conditional cooperators to withdraw, while a visible core of reliable cooperators can sometimes move a group in the opposite direction.1, 2 Human beings are capable of genuine attachment and sacrifice, but these capacities arose within an evolutionary process governed by survival and reproductive success. We are not unconditionally altruistic; we are conditionally and strategically cooperative.
Cooperation evolved within competition because, under the right conditions, cooperators can outperform individuals who act alone. Natural selection favors strategies that improve survival and reproduction. Cooperation can be one of those strategies, but it requires an explanation: an organism that pays a cost to help another risks exploitation by an organism that accepts the benefit without returning it. Harvard biologist Martin Nowak has summarized five broad mechanisms through which cooperation can evolve: kin selection, direct reciprocity, indirect reciprocity, network reciprocity, and competition among groups.3
Kin selection helps explain sacrifices for relatives who are likely to carry copies of the same genes. Parents care for children, siblings assist one another, and social insects perform extraordinary acts of self-sacrifice within colonies of close genetic relatives. Kinship, however, cannot fully explain human cooperation. People routinely assist friends, associates, customers, employers, employees, and strangers with whom they share no close genetic relationship. Robert Trivers supplied one of the most important explanations in his 1971 theory of reciprocal altruism,4 under which an individual provides a benefit when there is a sufficient probability that the recipient will return a benefit later. The exchange need not be immediate or exactly equal. One person may provide food today, information next month, protection during a crisis, or support years later. Cooperators must distinguish reliable partners from opportunists. They must reward reciprocity, distrust cheaters, punish exploitation, and sometimes forgive defectors who return to cooperation.
Conditional Cooperation
Psychologist Leda Cosmides and anthropologist John Tooby, pioneers in the field of evolutionary psychology, argued that social exchange repeatedly confronted ancestral humans with a specific adaptive problem: how to obtain the gains from cooperation without being systematically exploited by cheaters.5 Human reasoning is especially alert to violations of conditional rules when benefits are taken without required costs. We do not merely calculate material outcomes; we track who has fulfilled the terms of an exchange. We build and value reputations and are often willing to incur personal costs to punish those who claim benefits without contributing. In fact, tolerating a free rider threatens the credibility of the entire cooperative arrangement.
In the early 1980s, political scientist Robert Axelrod and biologist W.D. Hamilton, renowned for his work on kin selection and inclusive fitness (widely considered one of the 20th century’s most important evolutionary theorists), demonstrated how reciprocal cooperation could emerge in the absence of central authority.6 Their work drew on the Prisoner’s Dilemma experiments, a game in which two players independently choose whether to cooperate or cheat. Both earn points if they cooperate, but a player can earn more by cheating while the other cooperates, leaving the cooperative player with the lowest payoff. If both cheat, both do worse than if they had cooperated. In a single encounter, cheating earns a player more points regardless of what the other does. But when the same players meet repeatedly, cheating can cost them the benefits of cooperation in future encounters. Axelrod’s famous computer tournaments showed the power of strategies that begin cooperatively, respond to defection, and restore cooperation when the other player returns to it.7
This “shadow of the future” is absolutely crucial in the real world. Reputation allows reliable workers and firms to attract better partners, while trust lowers the cost of monitoring every transaction, and the prospect of future exchange makes a short-term act of exploitation expensive. When costs can be shifted indefinitely to strangers or rescue is guaranteed—incentives to defect become stronger.
We are not unconditionally altruistic; we are conditionally and strategically cooperative.
Recent research also cautions against treating repeated interaction as a complete explanation. A 2024 study combining evolutionary models with behavioral evidence found that repeated interaction alone and competition among groups alone did not reliably sustain cooperation across a broad range of strategies. Cooperation became much more robust when reciprocity within groups operated together with competition among groups.8 People cooperate internally, while the resulting groups compete externally.
That pattern is visible throughout modern society. For example, scientists cooperate within research teams while competing for discoveries and recognition, and athletes cooperate with teammates while competing against other teams. Nations depend on internal cooperation while competing economically, technologically, and sometimes militarily. This demonstrates that properly structured competition can discipline cooperation by requiring cooperative groups to produce results.
The problem, however, is even more complicated.
Hierarchy, Dominance, and Prestige
Human societies also form hierarchies. Human social groups repeatedly organize themselves according to differences in power, seniority, knowledge, skill, and reputation. Societies differ enormously in the form, permeability, and legitimacy of their hierarchies, but no large society has eliminated hierarchy itself.
Status can arise through at least two routes. Dominance obtains deference through control, intimidation, or the power to impose costs. Prestige attracts voluntarily conferred deference because others value a person’s knowledge, skill, judgment, generosity, or accomplishments. Anthropologists Joseph Henrich and Francisco Gil-White argued that prestige evolved partly because social learners benefited by identifying and copying successful individuals.9 A healthy society should restrain coercive dominance and encourage earned prestige.
No system, no matter how fairly or thoughtfully designed, can entirely abolish social strata because individuals are not interchangeable. People differ in intelligence, health and physical capacity, creativity, social skills, risk tolerance, or even willingness to delay gratification. Men and women also differ on average in some physical, behavioral, and reproductive characteristics, even though their distributions overlap and group averages never determine the abilities of every individual.
The existence of differences, importantly, does not make every hierarchy just. Hierarchies can be distorted by many factors, including discrimination, corruption, fraud, or even simple luck. People can and do acquire wealth or status without creating corresponding value. The (political) challenge is therefore to be able to distinguish productive hierarchy from predatory hierarchy: prestige from dominance, contribution from extraction, and earned reward from political privilege. When economic competition is suppressed by the design of a political system, hierarchy does not disappear. It migrates into the state. People then compete for bureaucratic rank, party membership, favored occupations, access to planners, and influence over the distribution of resources such as licenses or housing allocations. In other words, society may compress visible differences in income while creating enormous differences in political power.
The Role of Choice
Reciprocal cooperation depends upon the ability to choose interactive partners—personal, professional, or otherwise. People reward reliable associates and avoid unreliable ones. Employers select workers; workers choose employers; customers choose producers; lenders choose borrowers; friends withdraw from exploitative relationships; and communities exclude persistent cheaters. Recent research shows that mobility across group boundaries can extend cooperation. A 2025 experiment, for example, found that even limited freedom to move between groups helped participants reward cooperators, avoid free riders, and promote cooperation beyond their original group.10 Mobility did not abolish group loyalties, but it gave individuals a way to select better relationships.
Freedom of exit—the ability of a skilled worker to seek a better employer or a dissatisfied customer to seek a better supplier—is one of the principal mechanisms through which reciprocal cooperation is enforced. When the state controls domains such as employment, housing, finance, or production, the citizen cannot easily choose another partner. Instead of being able to leave an unsatisfactory relationship, she must petition the same institution that created it, creating a vicious negative cycle.
Years ago, when I was conducting research in the Soviet Union, I sometimes felt that the relationship between producer and consumer had been completely reversed. The employees did not work for the customer—the customer worked for the employees! On one occasion, I attempted to purchase an airline ticket from Moscow to Kamchatka, where I conducted my field work. The process required three separate lines: (1) an employee checked my identification; (2) another employee booked the flight; (3) a separate employee accepted payment. It was about an hour in each line.
From the customer’s perspective, the arrangement was absurd. One transaction that could have been completed at a single counter consumed much of a day. Yet the procedure made sense from the standpoint of the organization. It created several positions, divided responsibility into narrow tasks, and required each employee to perform only a small administrative function. The passenger’s time was treated as though it had no value. Such an arrangement was compatible with a Soviet system that promised employment to virtually everyone and measured success partly by maintaining jobs rather than by minimizing the customer’s time or improving the quality of service.
In a competitive market, producers generally must accommodate consumers because dissatisfied consumers can leave.
The institution had no compelling reason to redesign the process around the traveler. It had been optimized for the bureaucracy rather than for the person the bureaucracy ostensibly served. In a competitive market, producers generally must accommodate consumers because dissatisfied consumers can leave. In a state monopoly, consumers must accommodate producers because they have nowhere else to go. In contrast, a queue in a market is usually information. It tells potential suppliers that demand exceeds available supply or that the transaction is poorly organized. The supplier who adds capacity or consolidates procedures to shorten the wait may profit. A bureaucracy is more likely to treat the same queue as an administrative condition: something to number, monitor, regulate, and distribute fairly.
Markets, obviously, do not eliminate every queue. People still wait at airports, hospitals, and popular sporting or music events, and monopolies and regulation can limit the market’s response. But competitive markets give businesses a continuing incentive to recognize waiting time as a cost and find ways to reduce it.
Who Supplies the Bread?
Economist Paul Seabright famously recounted a revealing conversation that occurred approximately two years after the collapse of the Soviet Union. He was speaking with a senior Russian official who had been responsible for directing bread production in St. Petersburg. The official wanted to understand the mechanics of a market economy and asked a simple question: Who was in charge of supplying bread to London?11 The answer was that nobody was in overall charge.
Thousands of people—farmers, millers, bakers, truck drivers, warehouse operators, shop owners, and customers—coordinated their behavior without a single administrator directing the complete process. Each participant possessed only a fragment of the required knowledge. Yet Londoners could ordinarily purchase bread without waiting for a government office to calculate how many loaves the city should receive.
Importantly, markets are not devoid of planning. Every actor—from farmers to households—makes plans. What markets lack is a single comprehensive plan. Austrian economist and philosopher Friedrich Hayek noted that the knowledge required to coordinate an economy is, in a sense, unknowable to a single institution or individual. It is dispersed (among many people and geographies), incomplete, temporary, and often tacit. It cannot simply be collected by a central authority because much of it emerges only through “experimentation,” i.e., decisions, successes, and failures.12 Prices, for example, help communicate these changing conditions. Rising prices can signal scarcity or greater demand; falling prices can signal abundance or declining interest. Profit attracts resources toward arrangements customers value. Loss warns that labor, materials, and capital are being used in ways that do not justify their cost.
Prices are not perfect. People can be manipulated, poorly informed, or simply constrained by poverty. External costs such as pollution may not be captured without law or regulation. But prices supply feedback that a comprehensive central plan cannot duplicate.
Capitalism as Spontaneous Cooperation
Capitalism is often described as a celebration of selfishness. That description misses its most extraordinary feature: a functioning market economy is a system of cooperation among strangers. Nearly every object in a modern household exists because thousands of people coordinated their activities. They may live on different continents, speak different languages, practice different religions, and disagree on nearly every political question. They need not love one another! They need only identify a mutually beneficial exchange in which the buyer prefers to have the product and the seller the money. Both expect to gain.
This is reciprocal cooperation extended beyond intimate personal loyalty. Money, enforceable contracts, property rights, and the rule of law allow people to cooperate far beyond the small circles of kin and acquaintances for which much of human psychology originally evolved. Government has an essential role in maintaining those institutions, but the expectation of a future remains essential. Sellers, for example, depend on repeat business and reputation, while buyers depend on warranties and the prospect that suppliers will still exist tomorrow. Markets work best when neither side expects the transaction to be a final opportunity for exploitation.
Communism requires something fundamentally different. If private production and exchange are prohibited or severely restricted, an authority must decide what will be produced, in what quantities, by whom, with which resources, at what locations, for which recipients, and according to what priorities. The absence of markets transfers allocation to administrators. When official prices, production targets, and distribution rules fail to reflect actual supply and demand, black markets predictably emerge to satisfy needs that the formal system leaves unmet.
This produces a paradox: Socialism often promises to transfer power from owners to the people, yet extensive central planning necessarily transfers immediate decisions to government officials. The more comprehensive the plan (someone must rank competing needs, distribute scarce goods, set wages, approve investments, etc.), the more domains of life become dependent upon administrative permission. Power is shifted away from voluntary relationships and toward the institutions that control allocation—the very concentration of power socialism claims to overcome.
Nor does socialism eliminate competition. People continue to compete, but the object of competition changes: they compete for political influence (instead of competing for customers), persuade planners (in place of persuading consumers), and cultivate relationships with the officials who distribute resources. Economic competition shifts toward political competition.
Socialism and the Free-Rider Problem
Public-goods experiments repeatedly find that cooperation is vulnerable to free riding. A 2023 meta-analysis covering more than 48,000 observations from 20 different studies of centralized public-goods experiments found that punishment was the only mechanism that reliably sustained cooperation over time—otherwise, regardless of hierarchy that could conceivably enforce sustained cooperation by its mere presence, contributions inevitably decay over time.13 The result underscores a recurring socialist dilemma. If voluntary effort declines, the state must monitor, compel, or punish. In other words, a system that begins with the promise of universal cooperation becomes increasingly dependent upon administrative enforcement.
Socialism often promises to transfer power from owners to the people, yet extensive central planning necessarily transfers immediate decisions to government officials.
In my own Soviet experience, the cash rewards attached to very different kinds of work often appeared surprisingly compressed. Women sweeping streets and highly trained researchers could seem separated by much less pay than their differences in education, responsibility, and potential contribution would suggest. That observation should not be converted into the inaccurate claim that all Soviet workers earned the same wage. The Soviet system did contain wage differentials, status hierarchies, bonuses such as special housing or access to scarce goods, and other noncash privileges. The more defensible point is that administratively compressed wage structures weakened returns to education and shifted rewards into political and organizational channels. Indeed, economic research using Soviet household data found positive returns to education, but those returns were very low by comparison with many market economies and were intertwined with nonmonetary advantages.14 When material rewards do not adequately track training, effort, responsibility, and results, institutions must rely more heavily on prestige, privilege, and ideological duty. Yes, markets also misprice work and sometimes lavish wealth on activities of dubious social value, but the evolutionary point is narrower: persistent separation between contribution and reward weakens the expectation of reciprocity.
Punishing defectors creates a second-order free-rider problem. Enforcement is itself costly. Who monitors the workers? Who pays the monitors? Who ensures that the monitors are performing their duties? Who prevents them from using authority against personal or political enemies? Soviet authorities often relied upon informants and workplace surveillance to identify ideological or administrative violations. The Australian historian of the Soviet Union, Sheila Fitzpatrick, described how official complaint systems and political surveillance in Stalinism would often become entangled with neighborhood resentments, workplace conflicts, patronage, and personal grievances.15 Naturally, not every Soviet citizen envied every successful neighbor, but success and nonconformity were politically vulnerable when allocation and advancement depended upon administrative judgment.
Competition was not eliminated. Instead of gaining by producing something others voluntarily valued, an individual could gain by demonstrating loyalty, exposing a rival, or securing favor from those who controlled scarce opportunities. Every new layer of enforcement generated another principal-agent problem.
China’s Hybrid Experiment
China is an interesting case study that illustrates the tension between rewarding political loyalty and cultivating the expertise needed to compete with the rest of the world. Its claims to meritocracy have clear political limits: advancement can, and often does, depend on ideological conformity and obedience to state authority. Yet its leaders recognize that success in scientific and technological competition requires technical competence, whatever the prevailing political doctrine. China subordinates intellectual freedom to political control while treating technical competence as more important than demographic representation or ideological aspiration. Its 2024–2035 education strategy emphasizes identifying exceptional talent, the training of elite engineers and scientists, technological innovation, and evaluating performance according to quality, effectiveness, and contribution.16
The relevant lesson here for Western countries is that a society engaged in serious international competition cannot afford to subordinate demonstrable competence to ideological symbolism. We should be radically inclusive in discovering talent and uncompromisingly meritocratic when assigning responsibility. Inclusion enlarges the competition. Equity, when defined as predetermined equality of group outcomes, attempts to determine the result before the competition occurs.
Importantly, China’s enormous economic expansion followed the market-oriented reforms which begun in 1978: decentralization, greater reliance on prices as economic signals, expansion of non-state enterprise, opening to foreign investment and trade, and greater freedom for producers to retain gains from their work. Indeed, China did not become prosperous by perfecting Maoist central planning but by retreating from it.17 Yet the Communist Party retained much control, by means of state ownership in strategic sectors and the power to direct investment toward political priorities. The resulting hybrid can be extraordinarily productive where markets, entrepreneurship, and competition are permitted. It can also generate massive distortions where political incentives override consumer demand and the discipline of loss.
A successful society should channel the struggle for status away from coercive dominance and toward prestige earned through competence and contribution.
China’s housing sector provides a striking example. Popular accounts often refer to vast ghost cities and tens of thousands of empty buildings. For obvious reasons, precise national vacancy estimates are difficult to obtain, but completely abandoned cities are only the most spectacular part of the problem. Underutilized developments are more common and more measurable. A 2025 study published in Nature Cities, a peer-reviewed Springer Nature journal devoted to urban research, estimated that housing-utilization efficiency in 108 Chinese cities fell from approximately 84 percent in 2010 to 78 percent in 2020.18 Official Chinese figures reported 766.32 million square meters of commercial property awaiting sale at the end of 2025, including 402.36 million square meters of residential property; residential sales had also continued to decline.19 These figures have limitations (e.g., they do not count every privately owned but vacant apartment), but they document extraordinary unsold inventory. Compare the roughly 22 percent underutilization in China with the fact that in the U.S. and Western Europe those markets typically run with low single-digit vacancy rates and face the opposite problem (undersupply).
The outcome did not result from a single national command to build empty apartments; private developers, investors, banks, and even local governments all participated. But their choices operated within a politicized system. This is not unlike a larger version of the three Soviet airline lines I discussed earlier. Both arrangements made sense for the institutions administering them while imposing costs on their supposed beneficiaries.
Why Socialism Keeps Returning
History has shown us the results of the failure to understand how cooperation actually works. The twentieth century produced abundant evidence of the failures of centralized communist systems. Yet socialism continually returns as though it were a new idea. Historical memory fades, while the moral aspiration remains attractive. In 2022, Pew found that younger adults were more likely to hold favorable views of socialism and less favorable views of capitalism than older adults.20 In 2025, Gallup reported that capitalism remained more popular overall, but its favorable rating had declined to 54 percent, while socialism was viewed favorably by 39 percent.21
These polls require caution. Some respondents use socialism to mean Soviet central planning while others mean universal health insurance, higher taxes, public education, or Scandinavian social democracy. Many people who express approval of socialism also approve of entrepreneurs, small businesses, and free enterprise. Socialism also benefits from an asymmetry in judgment. Capitalism is compared with its actual outcomes: inequality, recessions, unaffordable housing, or even corporate misconduct such as environmental pollution. By contrast, socialism is compared with its aspirations: equality, dignity, solidarity, security, and universal provision. When socialist institutions fail, advocates often attribute the result to insufficient socialism, bad leadership, foreign interference, historical conditions, or the claim that the system was never truly socialist. Then, definitions shift: The Soviet Union was authoritarian rather than socialist, China is capitalist because it permits markets, and Venezuela failed because of dependence on oil and corruption. Meanwhile, Scandinavia is described as socialist even though it preserves competition, bankruptcy, private property, and market prices.
The argument I wish to make here concerns centralized socialism: extensive political control over production, investment, prices, employment, and allocation, combined with substantial weakening of private ownership, competition, and exit. Voluntary cooperatives, local mutual-aid associations, particular public services, welfare programs, and regulated market economies raise different questions and should not be dismissed by changing labels.
The Strongest Counterargument: Successful Commons
The Nobel Prize-winning economist Elinor Ostrom demonstrated that communities can sometimes manage common resources without either complete privatization or centralized state control.22, 23 Her work is often presented as a rebuttal to the claim that shared resources inevitably produce a tragedy of the commons. But Ostrom’s successful cases did not abolish the game-theoretic problem; rather, they solved it! Successful commons usually had identifiable participants, clear boundaries, locally accepted rules, monitoring, graduated sanctions, conflict-resolution mechanisms, and the authority to exclude persistent defectors. They were decentralized, adapted to local knowledge, and governed by people who interacted repeatedly.
These are precisely the conditions under which evolutionary theory predicts that cooperation can survive! A family can share resources because its members know one another, monitor behavior, interact repeatedly, and maintain powerful emotional commitments. Likewise, a worker cooperative can function because participants are identifiable and can link rules and rewards to contribution. None of these examples demonstrate that the same arrangement can expand without limit to millions of anonymous citizens who cannot select one another, directly observe contributions, or withdraw from the system.
Conclusion
Human civilization is one of evolution’s greatest cooperative achievements. It emerged because social and economic institutions allowed individuals to advance their own interests by helping others. Reciprocal altruism turned assistance into an advantageous long-term strategy. Reputation allowed cooperators to find one another. Moral emotions helped detect and punish cheaters. Partner choice allowed people to leave exploitative relationships. Competition among groups rewarded forms of internal cooperation that produced better results. Markets extend these mechanisms across enormous populations.
Centrally planned socialism works against these mechanisms when it separates contribution from reward, weakens partner choice, obscures responsibility, protects organizations from failure, and replaces horizontal exchange with vertical administration. Its central problem is that human cooperation is conditional. A successful society should channel the struggle for status away from coercive dominance and toward prestige earned through competence and contribution. It should widen participation while preserving standards, protect the vulnerable without rewarding avoidable defection, and prevent both public and private institutions from transferring the costs of failure to others.
Markets are by no means morally perfect. They can and do generate inequality, instability, environmental damage, exploitation, and fraud. The alternative to socialism is not indifference toward misfortune, nor is it the belief that every existing distribution of wealth is deserved. The objective that can increase human flourishing should be an inclusive market society that protects people from catastrophe, develops human capabilities, maintains open competition, prevents political privilege, and—in line with the facts outlined here—preserves the connection between contribution and reward.