TECHNOLOGY AND ECONOMY 



17 



People interestedly report news of market prices, 

 as well as wages and business transactions in 

 general. They seem to have Icnowledge of price 

 differentials in various local markets, and calculate 

 comparative advantages. But it would require 

 much close study to determine the accuracy and 

 cm-rency of such knowledge. 



With respect to the second point, there is 

 remarkable indifference. There is no discernible 

 tendency to attend the personality of the vendor; 

 the buyer will accept a commodity from a stranger 

 in the market as readily as from his o\vn brother, 

 from a Ladino as from an Indian. There are also 

 few artificial distinctions, such as in advertised 

 brands; recognized differences in quality tend to 

 be real differences (in types of oranges, for ex- 

 ample) that distinguish commodities. 



Obviously, it is more difficult to determine 

 "indifference" in the hiring of labor or the choice 

 of employer; the work is often not the same, the 

 workers and employers have different expectations 

 of one another; and there are nonquantitative 

 factors that necessarily confuse the picture. To 

 say that there is indeeed indifference in the "labor 

 market" to the degree that the "commodities" 

 are subject to no unportant difference might be 

 justified; but it seems futile as only repeating, and 

 not appl^ang, a theoretical concept. 



The criterion of rationality which involves 

 consistent behavior is (for me) the most difficult 

 to apply, since rational behavior is now being 

 defined as that behavior which a given consumer 

 displays, provided that he is consistent. Both 

 cultural differences and personal idiosyncrasies 

 are permitted in the definition. On this basis the 

 Indians of Panajachel appear as rational as any. 

 Similarly, Lange says (1945-46, p. 30) that "a unit 

 of economic decision is said to act rationally when 

 its objective is the maximization of a magnitude. 

 Firms thus act rationally by definition, while 

 households do so only when their preferred alloca- 

 tions of resources among different wants can be 

 ordered along a scale." I have already suggested 

 that by this definition the households about which 

 I write act rationally. 



On the other hand, there is the special conception 

 of rationality as Max Weber (1947, pp. 16S-171) 

 uses the term: economic activity is rational insofar 

 as it involves plaimed distribution of services at 

 the disposal of the economizing person (or planned 

 acquisition of those in possession of others) in 



accordance with his estimate of the expected cost, 

 thus taking into account marginal utihty. In 

 this sense also most economic behavior in the 

 Indian economy of this region of Guatemala is 

 generally highly "rational." The Indians may 

 of course be wrong in their "estimates," but they 

 weigh choices in accordance with the economic 

 principle. Weber calls exchange "economically 

 rationaUy oriented" when it concludes by com- 

 promise a struggle of interests in which either both 

 parties have expected to obtain advantage, or in 

 which one of the parties is compelled by economic 

 power or need to participate. To this "rational" 

 exchange be opposes the "customary" exchange 

 involved in gifts among friends, chiefs, and so on — 

 although he adds that such gift-exchange may also 

 be rationally oriented. In this sense again the 

 local economy is highly rational, for even gift 

 exchange (in marriage, for example) and cere- 

 monial disposition of goods and services are 

 notoriously rationally oriented, with the cost 

 carefully counted and often resulting from com- 

 promises of conflicting interests. 



However, Weber also opposes to "rational" 

 exchange those exchanges that have as their 

 purpose not gain (the claance to make a profit in 

 the market) but the provision of commodities for 

 the sustenance of life. In tlie latter case, condi- 

 tions of exchange are determined individually, and 

 exchange is thus irrational. "Thus, for instance, 

 household surpluses ^vill be valued according to the 

 individual marginal utilities of the particular 

 household economy and maj^ on occasion be sold 

 very cheaply. Under certain cu'cumstances the 

 fortuitous desires of the moment determine to a 

 very high degree the marginal utility of goods 

 which are sought in excliange [p. 171]." In this 

 sense, the economy described here cannot be very 

 rational, since most persons are too close to a 

 subsistence level of life, too subject to the vagaries 

 of fortune, to avoid frequent exchanges to obtain 

 commodities necessary to life. Indeed, only in the 

 cases of real merchants is there much "rational" 

 excliange in this sense. Statistically, in the 

 economy as a whole, "rational" transactions must 

 be in the very small minority. This is another 

 way of saying that the economy is not "capitalist" 

 in the sense of having business firms, for as Weber 

 points out (pp. 171, 192) a "rational" struggle for 

 exchange develops in its highest form in transac- 

 tions for commodities whicli are used bv or ex- 



