An evolutionary tale for today

Imagine that you are a banker with a limited amount of money to lend. If you advance loans to people who are the poorest credit risks, you are taking a great gamble that they will default on their loans and you will go out of business. This sets up a paradox: the people who most need the money are also the worst credit risks and thus cannot get a loan, whereas the people who least need the money are also the best credit risks and thus it is that the rich get richer.

The evolutionary psychologists John Tooby and Leda Cosmides call this the Banker’s Paradox, and they apply it to a deeper evolutionary problem: to whom should we extend our friendship? The Banker’s Paradox, they suggest, “is analogous to a serious adaptive problem faced by our hominid ancestors: exactly when an ancestral hunter-gatherer is in most dire need of assistance, she becomes a bad ‘credit risk’ and, for this reason, is less attractive as a potential recipient of assistance.” (continue reading…)