Market Economics: Patience
Photo by John McArthur
By Sterling M. Hawkins, MSW, LCSW-C, LICSW
“Patience is not the ability to wait, but the ability to keep a good attitude while waiting.”
-Unknown
Before pursuing a career in social work, I took a keen interest in economics. As an undergraduate, I stacked econ courses because the introductory courses were much easier than chemistry and physics. I’ve always struggled with the pure sciences because I’m a slow learner and resources that lent themself to application were not always accessible. However, I soon realized that while physics and chemistry require high critical thinking skills and logic, the deeper you go into economics the laws of economics don’t always apply. This is because economics is influenced by the irrational nature of humans. With chemistry and physics, you can be certain that if you try to measure a specific property among a spread of possible positions, if you repeat the measurement many times you can trace out the distribution of possible results. With the social sciences what is certain is relative uncertainty. Human behavior, while often predictable, fails to conform neatly to theorems applicable to precise outcomes. Social Scientists must incorporate laws involving both the physical world and society. And the complex relationships that exist between the two. Economics in many ways helped me to explain a broad range of positions with an even wider range of outcomes. I am beginning to return to economics in helping me to navigate the world of interpersonal relationships-mainly couples. It’s messy work, but I enjoy learning from my observations and applied research in its most basic forms.
Over the next several months I will be examining four characteristics found in healthy interpersonal relationships. I will use concepts found in economic theory to illustrate how human relationships mirror financial markets. The following characteristics and their definitions are:
Patience- The capacity to accept, tolerate, and delay problems without becoming annoyed or anxious.
Gratitude- The quality of being thankful; readiness to show appreciation for and to return kindness.
Intuition- The ability to understand something instinctively without the need for conscious reasoning.
Teachable- The ability and willingness to learn by instruction.
“The qualities most useful to ourselves are, first of all, superior reasons and understanding, by which we are capable of discerning the remote consequences of all our actions; and, secondly, self-command, by which we are enabled to abstain from present pleasure or to endure present pain in order to obtain a greater pleasure in some future time”. Theory of Moral Sentiments (1759), Adam Smith
Patience encompasses tolerance, which is the ability to hold fast to guiding principles that have a historical pedigree in times of instability. Relationships like financial transactions are based on conditions that strengthen or weaken patience. Identifying what allows you to feel safe in a relationship is the key to remaining patient. In couples therapy, I try to identify types of “currency” that govern the collaboration between partners. Currency comes in many forms: intellectual, physical, sexual, psychological-emotional, and material- property. Each partner in the relationship must determine the type and value of the currency they hold to be exchanged. Couples moving toward long-term commitments naturally attempt to differentiate the types of currency that exist between them and their value. Rarely do both partners hold currency having an identical value between them. The collective values shared by each partner are what promote patience. Patience is a slow organic process. It cannot be forced.
Financial investors are warned. to take a long-term view rather than trying to second guess the market and selling off stocks and transferring funds according to the ebbs and flows of the market. The standard advice is that you shouldn’t be investing unless you’re prepared to hold on to your portfolio for at least five years or more. And, that ten years, twenty years, or more is even better. This is because of the principle of Compound Interest.
An example of this would be your investment of “time” into your partner’s life over the course of one year, by sharing in household chores, shopping, child care, and transportation. While these investments of time may hold no monetary value, they add quality to your partner’s life over time. After the first year theoretically, your original investment should have added value to your partner’s life. This added value should consequently increase your net worth in the relationship, by allowing your partner the freedom to work and pursue other commitments. The original principal has over the year yielded some returns and interest or value to the relationship. And your partner’s ability to increase their own value independently due to your investment.
As humans, we crave stability. Long-term commitments and partnerships hold the greatest opportunity for gains as well as the greatest risks for loss. Patience is cultivated over time. It is often decreased by market conditions represented by challenges that disrupt the equilibrium or comfort zone between the known and the unknown. Conditions that promote patience and those that undermine it are linked to quality and quantity. When my supply is plentiful and exceptional my patience is high, and my confidence is strong. However, when supply is scarce or inferior my patience is low, and my confidence may weaken or become absent altogether.
Assuming we are mentally and emotionally healthy, to begin with, most couples seek balance and attempt to minimize stressors associated with conflict. One of the problems with maintaining patience in long-term relationships is that we have few incentives to do so. The emphasis within the last fifty years or so has been toward self-centeredness as opposed to self-denial. At the risk of overgeneralizing this trend, it is safe to say that most couples fail to appreciate the intrinsic qualities or values that each partner brings to the relationship. Appreciating or possessing acceptance of personality traits in our partners having lesser values can and does help with stabilizing the equilibrium that allows for gratitude, another essential quality that I will explore in greater depth in my next essay. An example of this can be easily found among most families. It’s a given that we often will tolerate more from a blood relative than we would a stranger. We do this because our connection by birth or blood is something we do not choose. Some may argue that within certain cultures even marriage is not a choice. And their assertion would be correct. But, for those connections that are familial, there’s often a sense of duty or commitment.
That is to say, we tolerate undesirable qualities because they represent only a part of the collective value of the person with whom we are in a relationship. Individuals usually possess positive qualities or values that exceed those traits that we find undesirable and offensive. As a result, by their very nature, long-term relationships should over time produce the type of patience that endures. For those of us in long-term partnerships we understand this. Time, however, is a non-sequitur. Time alone may fail to fix relational conflicts or heal all wounds. In some instances, time fails to guarantee that patients will survive in turbulent market conditions. So, when do such conditions destroy patience?
To translate this into economics, we must remember the values or currencies we bring into the relationship are rarely fixed. This means that we must learn the principle of diversification— a strategy that involves investing in a variety of commodities to reduce the risk that will cause the relationship to suffer. English philosopher and poet Eric Carpenter (1844 -1929) describes this process. “For any big [successful] relationship plenty of time has to be allowed. Whichever side of the nature - mental, emotional, physical, and so forth— may have happened to take the lead, it must not and cannot monopolize the affair. It must drag other sides in and give their place. And this means time, and temporary bewilderment and confusion.”
To apply this in economic terms we must see interpersonal relationships in the way we see banks and capital markets. Both are simply a means of matching savings to investments. Couples that realize the benefits of patience are more efficient with their currency. They save and spend wisely which promotes long-term growth.
British Economist, Andrew Haldane, describes the challenges in achieving this delicate balance: “The implication of such behaviors [impatience] are far-reaching. “The patient planner becomes a spontaneous doer when outcomes are within reach, The cautious saver becomes a reckless spender when nest eggs are close to hatching. The long-term investor becomes a short-term speculator if assets can be cashed. As temptation beckons, the devil on one shoulder whispers more seductively than the angel on the other. Preferences switch as the distance becomes instant.” (“Andrew Haldane: Patience and Finance - Bank for International Settlements”)
In these scenarios one thing is clear. Couples are more likely to experience impatience when expectations appear imminent and certain. Humans are not hard-wired for patience. We need incentives in small quantities. If I believe that my investment in my partner will yield a future value greater than the present, I will tolerate their shortcomings and inconsistencies that otherwise would tempt me to divest and curtail future dividends. And, when patience is rewarded by incremental increases in valued currency, I am encouraged to continue what I am doing even when stock values fluctuate. Patience is impacted by multiple variables— type and value of the currency (those positive values that are desirable and appreciated by my partner), and rates of exchange, how much certain tangible goods are valued by my partner at a given time. Gains and losses are inextricably connected. This is what makes the cultivation of patience so demanding in relationships. The expectations that partners place on each other are subject to change based on what is seen, heard, and felt during the relationship. Careful identification of how each partner interprets what they see, hear, and feel becomes the key determinant in whether or not the relationship will survive.
So, what we can learn from the parallels that can be found between couples and their interaction with each other based on market economies?
In a market economy, most economic decision-making is done through voluntary transactions according to the laws of supply and demand. Remember that each of us holds types of currency. The value of which fluctuates based on supply and demand. Couples must practice patience when evaluating their currency and be willing to endure temporary deficits until supplies reach satisfactory levels. What this means for the couple in the midst of a recession is that they must rigorously evaluate their currency and ask themselves and their partner— what values and/or commodities my partner brings into the relationship that makes me a better person? And, do I possess more or less value if those commodities were absent, and my partner was not present in my life?
A market economy gives entrepreneurs the freedom to pursue profit by creating more valuable outputs than the inputs they use up, and free to fail and go out of business if they do not. In short, as the saying goes no person is an island. Each of us possesses qualities that are the result of other people’s investments in us. It would be wrong for us to say that we possess all of what we need independent of others to reach our full potential. Therefore, we must be careful not to squander the goods we have received from others. This means that I must acknowledge the good I receive from my partner and be willing to risk losing it, knowing that if I fail through a lack of patience to find ways to reciprocate the investment that my partner has made into my life and into our relationship, the business of what keeps us connected will not succeed.
Economists universally agree that market-oriented economies produce better economic outcomes but differ on the precise balance between markets and central planning that is best for a nation’s long-term well-being. Most couples forget that competition is good. Competition says that I am willing to fight for what I want in my relationship at the exclusion of all things harmful to the one I love. Patience, therefore, allows me to compete for what is best, desirable, and most profitable for the long-term growth of the relationship.
Hannah Arendt (1906 - 1975), historian and political philosopher, writing on love and the fundamental fear of loss concludes by giving us what in the end we gain from being patient. She writes, “ A love that seeks anything safe and disposable on earth is constantly frustrated because everything is doomed to die. In this frustration, love turns about, and its object becomes a negation so that nothing is to be desired except freedom from fear. Such fearlessness exists only in the complete calm that can no longer be shaken by events expected by the future.” (“Hannah Arendt on Love and How to Live with the Fundamental … - Pocket”) Patience, therefore, is the recognition that loss is inescapable and that what we truly desire in a market economy is freedom from fear.