Collective Behaviour: The Linchpin keeping the Human Society and the Market Economy Functioning

A society along with the financial markets generally operates under a Collective behaviour model. And without a defined central command or control, it’s probably one of the best way to regulate activity and growth. In case you are wondering, examples of such systems are abundant in nature.

For example, various species of ants that live in colonies also operate without any central control, using patterns of interaction to regulate activity. Ants are known to regulate their behaviour in response to their environments. Also in terms of core building block of life, cells act collectively and regulate their activity without a defined central control. 

And the same applies to humans. As species, humans tend to prefer living in a collective, and throughout the evolutionary journey of humans, their collective behaviour has regulated their overall growth and activities. 

The idea of a society, nation state, religion or financial markets for that matter. All function and operate under a collective behaviour model. So a change or deviation in the collective behaviour will have influence on how the system operates. 

Businesses now proactively study the collective behavioural trends in the society to market their products, and the area of data science has seen a rapid year-on-year growth as companies as well as political parties try to study the ecology of collective behaviour, and then devise processes and tools, in order to harness the ability to influence or change the collective behaviour.

Getting the collective behavioural trend right is a key deciding factor on whether businesses or the markets can make profit. Economic indicators are conceived on the basis of collecting and capturing specific behavioural trends, in order to better understand the direction of travel of the underlying economy. And find ways to do the interpretation of these behavioural trends, captured through various indicators is now a vibrant field in its own right. The market volatility, economic growth or recession are all a by-product of collective behaviour. 

In the historical context, people have used propaganda as a tool to push through a change in the collective behaviour of humans as species, be it religion, the idea of nationalism, or socialism vs capitalism debate for that matter. A democracy or a dictator also relies heavily on influencing and affecting the collective behaviour. And the future of a society as well as humanity at large, is quite literally dependent on the collective behaviour of humans as species. 

A mature human society with mature laws reflect the maturity in the collective behaviour of the humans forming that specific society. But that can be changed or disrupted over time, causing conflicts and chaos. The idea of globalisation and the geopolitical order are all heavily reliant on the collective behaviour, because that’s what creates a global order, whatever that might be. 

Therefore, in my view, it is quite important for average people to understand or have some sort of understanding of the significance of collective behaviour, because that’s how a society will get shaped. It is the linchpin that keeps the idea of an organised human society and also  the larger idea of market economy functioning. 

You could try to bring the entire human species under a central control or command, and it has been tried before using a God model as well as the idea of a nation state being governed by a constitution and a legislative body , but after a while, the functioning of such systems starts to become somewhat chaotic causing disruption. And that’s probably because nature has designed humans as species to function effectively in a collective model, and not under a central command structure. Any model or attempt to reinvent the system that requires humans as a collective to fully surrender to a central control will most likely not work efficiently over time. And the wheels may eventually come off as evident from history and the current state of global affairs.