Ratchet effect
Encyclopedia
A metaphorical ratchet effect is an instance of the restrained ability of human processes to be reversed once a specific thing has happened, analogous with the mechanical ratchet
that holds the spring tight as a clock is wound up. It is related to the phenomena of featuritis and scope creep
in the manufacture of various consumer goods, and of mission creep
in military planning.
Garrett Hardin
, a biologist and environmentalist, used the phrase to describe how food aid keeps people alive who would otherwise die in a famine
. They live and multiply in better times, making another bigger crisis inevitable, since the supply of food has not been increased. The same point was made by Thomas Malthus
in 1798.
Governance
Austrian school
economist
Robert Higgs
used the term to describe the seemingly irreversible expansion of government in times of crisis in his book Crisis and Leviathan. Similarly, governments have difficulty in rolling back
huge bureaucratic organizations created initially for temporary needs, e.g., at times of war, natural or economic crisis. The effect may likewise afflict large business corporations with myriad layers of bureaucracy
which resist reform or dismantling.
Production strategy
The ratchet effect can denote an economic strategy arising in an environment where incentive depends on both current and past production, such as in a competitive industry employing piece rates. The producers observe that since incentive is readjusted based on their production, any increase in production confers only a temporary increase in incentive while requiring a permanently greater expenditure of work. They therefore decide not to reveal hidden production capacity unless forced to do so.
Game theory
The ratchet effect is central to the mathematical
Parrondo's paradox
.
Cultural anthropology
In 1999 comparative psychologist Michael Tomasello
used the ratchet effect metaphor to shed light on the evolution of culture. He explains that the sharedness of human culture means that it is cumulative in character. Once a certain invention has been made, it can jump from one mind to another (by means of imitation) and thus a whole population can acquire a new trait (and so the ratchet has gone "up" one tooth).
Negotiating Group in the 1990s as the essence of a device to enforce legislative progress toward "free trade
" by preventing legislative rollback
with the compulsory assent of governments as a condition of participation.
Ratchet (device)
A ratchet is a device that allows continuous linear or rotary motion in only one direction while preventing motion in the opposite direction. Because most socket wrenches today use ratcheting handles, the term "ratchet" alone is often used to refer to a ratcheting wrench, and the terms "ratchet"...
that holds the spring tight as a clock is wound up. It is related to the phenomena of featuritis and scope creep
Scope creep
Scope Creep in project management refers to uncontrolled changes or continuous growth in a project's scope. This phenomenon can occur when the scope of a project is not properly defined, documented, or controlled...
in the manufacture of various consumer goods, and of mission creep
Mission creep
Mission creep is the expansion of a project or mission beyond its original goals, often after initial successes. Mission creep is usually considered undesirable due to the dangerous path of each success breeding more ambitious attempts, only stopping when a final, often catastrophic, failure occurs...
in military planning.
Examples
Famine cycleGarrett Hardin
Garrett Hardin
Garrett James Hardin was an American ecologist who warned of the dangers of overpopulation and whose concept of the tragedy of the commons brought attention to "the damage that innocent actions by individuals can inflict on the environment"...
, a biologist and environmentalist, used the phrase to describe how food aid keeps people alive who would otherwise die in a famine
Famine
A famine is a widespread scarcity of food, caused by several factors including crop failure, overpopulation, or government policies. This phenomenon is usually accompanied or followed by regional malnutrition, starvation, epidemic, and increased mortality. Every continent in the world has...
. They live and multiply in better times, making another bigger crisis inevitable, since the supply of food has not been increased. The same point was made by Thomas Malthus
Thomas Malthus
The Reverend Thomas Robert Malthus FRS was an English scholar, influential in political economy and demography. Malthus popularized the economic theory of rent....
in 1798.
Governance
Austrian school
Austrian School
The Austrian School of economics is a heterodox school of economic thought. It advocates methodological individualism in interpreting economic developments , the theory that money is non-neutral, the theory that the capital structure of economies consists of heterogeneous goods that have...
economist
Economist
An economist is a professional in the social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
Robert Higgs
Robert Higgs
Robert Higgs is an American economic historian, economist combining the insights from the Public Choice, Institutional and Austrian schools of economics, and a classical liberal or libertarian in political and legal theory and public policy...
used the term to describe the seemingly irreversible expansion of government in times of crisis in his book Crisis and Leviathan. Similarly, governments have difficulty in rolling back
Rollback (legislation)
For related uses, see Rollback In government and economic contexts, Rollback metaphorically denotes action to repeal, dismantle or otherwise diminish the effect of a law or regulation.-Trade legislation:...
huge bureaucratic organizations created initially for temporary needs, e.g., at times of war, natural or economic crisis. The effect may likewise afflict large business corporations with myriad layers of bureaucracy
Bureaucracy
A bureaucracy is an organization of non-elected officials of a governmental or organization who implement the rules, laws, and functions of their institution, and are occasionally characterized by officialism and red tape.-Weberian bureaucracy:...
which resist reform or dismantling.
Production strategy
The ratchet effect can denote an economic strategy arising in an environment where incentive depends on both current and past production, such as in a competitive industry employing piece rates. The producers observe that since incentive is readjusted based on their production, any increase in production confers only a temporary increase in incentive while requiring a permanently greater expenditure of work. They therefore decide not to reveal hidden production capacity unless forced to do so.
Game theory
The ratchet effect is central to the mathematical
Mathematics
Mathematics is the study of quantity, space, structure, and change. Mathematicians seek out patterns and formulate new conjectures. Mathematicians resolve the truth or falsity of conjectures by mathematical proofs, which are arguments sufficient to convince other mathematicians of their validity...
Parrondo's paradox
Parrondo's paradox
Parrondo's paradox, a paradox in game theory, has been described as: A losing strategy that wins. It is named after its creator, Spanish physicist Juan Parrondo, who discovered the paradox in 1996...
.
Cultural anthropology
In 1999 comparative psychologist Michael Tomasello
Michael Tomasello
Michael Tomasello is an American developmentalpsychologist. He is a co-director of the Max Planck Institute for Evolutionary Anthropology in Leipzig, Germany.-Life:...
used the ratchet effect metaphor to shed light on the evolution of culture. He explains that the sharedness of human culture means that it is cumulative in character. Once a certain invention has been made, it can jump from one mind to another (by means of imitation) and thus a whole population can acquire a new trait (and so the ratchet has gone "up" one tooth).
Consumer products
A 'ratchet effect' can be seen in long-term trends in the production of many consumer goods. Year by year, automobiles gradually acquire more features. Competitive pressures make it hard for manufacturers to cut back on the features unless forced by a true scarcity of raw materials (e.g., an oil shortage that drives costs up radically). University textbook publishers gradually get "stuck" in producing books that have excess content and features. Airlines initiate frequent-flyer programs that become ever harder to terminate. Successive generations of home appliances gradually acquire more features; new editions of software acquire more features; and so on. With all of these goods, there is ongoing debate as to whether the added features truly improve usability, or simply increase the tendency for people to buy the goods.Trade legislation
The term was included by the MAIMultilateral Agreement on Investment
The Multilateral Agreement on Investment was a draft agreement negotiated between members of the Organisation for Economic Co-operation and Development in 1995–1998. Its ostensible purpose was to develop multilateral rules that would ensure international investment was governed in a more...
Negotiating Group in the 1990s as the essence of a device to enforce legislative progress toward "free trade
Free trade
Under a free trade policy, prices emerge from supply and demand, and are the sole determinant of resource allocation. 'Free' trade differs from other forms of trade policy where the allocation of goods and services among trading countries are determined by price strategies that may differ from...
" by preventing legislative rollback
Rollback (legislation)
For related uses, see Rollback In government and economic contexts, Rollback metaphorically denotes action to repeal, dismantle or otherwise diminish the effect of a law or regulation.-Trade legislation:...
with the compulsory assent of governments as a condition of participation.
Rollback is the liberalisation process by which the reduction and eventual elimination of nonconforming measures to the MAI would take place. It is a dynamic element linked with standstill, which provides its starting point. Combined with standstill, it would produce a “ratchet effect”, where any new
liberalisation measures would be “locked in” so they could not be rescinded or nullified over time.
External links
See also
- Garrett HardinGarrett HardinGarrett James Hardin was an American ecologist who warned of the dangers of overpopulation and whose concept of the tragedy of the commons brought attention to "the damage that innocent actions by individuals can inflict on the environment"...
- Robert HiggsRobert HiggsRobert Higgs is an American economic historian, economist combining the insights from the Public Choice, Institutional and Austrian schools of economics, and a classical liberal or libertarian in political and legal theory and public policy...
- Muller's ratchetMuller's ratchetIn evolutionary genetics, Muller's ratchet is the process by which the genomes of an asexual population accumulate deleterious mutations in an irreversible manner....
- Tragedy of the commonsTragedy of the commonsThe tragedy of the commons is a dilemma arising from the situation in which multiple individuals, acting independently and rationally consulting their own self-interest, will ultimately deplete a shared limited resource, even when it is clear that it is not in anyone's long-term interest for this...