Stocks, Flows, and Friendship
By Bryan Caplan
When a good friend hurts your feelings, what do you do? I normally chalk it up to miscommunication, and silently forgive them in my heart. But I seem to be in a minority here. I often see friends grow apart over the tiniest of slights: A says the wrong thing to B, B tries to get back at A somehow, A wonders what B’s problem is… and a trivial incident spirals out of control.
As far as I can tell, the underlying critical difference between me and people who lose their friends is that I judge people as stocks, while they judge them as flows. When a friend hurts my feelings, it’s almost always trivial compared to all the joy they’ve brought me. So why would I get upset at someone who, as a package, is still a great deal? In contrast, many other people focus on flows; their friends are just one faux pas away from getting purged.
On the surface, admittedly, the flow approach has a lot going for it. Won’t people treat you better if you charge a high price for bad treatment? And if a friend knows that he’s got a huge emotional bank account with you, isn’t that an invitation to abuse?
On reflection, though, I think that the stock approach to friendship is vastly better than the flow approach.
The first and biggest reason: Misunderstandings between friends are much more common than betrayal. The flow approach raises the price of betrayal, but it tends to amplify misunderstandings. The stock approach, in contrast, extinguishes the fires of misunderstanding before they can spread.
The second reason and smaller reason: The stock approach gives better incentives for building long-term relationships. If your friend takes a flow approach, you can do him a long series of favors, and still get purged overnight. So what’s the point of amassing goodwill when you can suddenly lose it all? In contrast, if your friend takes a stock approach, you don’t have to worry about being “expropriated,” because your friend won’t forget all that you’ve done for him.
Admittedly, I’m heavily relying on my own first-hand experience here. But my experience is pretty extreme: I’ve never been betrayed by a friend, or lost a friend who was dear to me. You can call it luck; but I think I’ve made my own luck.
Of course, if I’ve in any way offended you with this post, the fault is mine. 🙂