God, Law, and the Market - A History of What Mankind Has "Believed"【From God to Code. An Evolutionary History of Belief and Trust: Part I】
This section explains what humanity has come to believe.
Good morning.
I am mitsui, a web3 researcher.
Every Saturday and Sunday at noon, we update the web3 foundation report. This week's report, "From God to Code. An Evolutionary History of Faith and Trust," which is a bit abstract, but explains what mankind has believed in. Please take a look at it until the end!
1. Introduction
2. faith in God - absolute authority
3. rule of law - from God to man
4. trust in the market - the invisible hand
5. summary
1. introduction
Our society is built on cooperation among strangers. When we buy coffee at the convenience store in the morning, we trust that the clerk will operate the cash register correctly and that the money we paid will have value. When we board a train, we trust that the operating system is functioning properly.
But when you stop and think about it, isn't this remarkable? How can we "believe" so much in someone whose face and name we do not know, or in a system we cannot see?
Aim of the article: "Why do people believe in something?" and approach the essence of the web3 based on the universal theme of "Why do people believe in something?
From God to Code: An Evolutionary History of Faith and Trust," through Part I and Part II, aims to answer this fundamental question: "Why do people believe in something? and aims to unravel the history of "faith" and "trust" that have shaped human society, and to approach the essence of "web3".
web3 is a concept for a new Internet based on blockchain technology. Often referred to as the "decentralized Internet," it aims to realize an autonomous digital society that does not depend on specific companies or governments. However, the focus tends to be exclusively on the technical aspects of the concept, and the ideological and social background, such as "Why is it needed now?
At the core of web3 is the idea of "trustless. This does not mean that trust is unnecessary. Rather, it is an attempt to ensure trust in society through mathematical cryptography, program code, and a system of consensus building among all open network participants, rather than relying on personal trust in a specific person (individual or organization).
From this perspective of "revolutionizing the nature of trust," we can see that web3 is not merely an evolution of technology, but is positioned at the forefront of the lineage of "what we believe" that has been spun by humankind throughout its long history.
A look back at how "faith and trust" have shaped human society.
One of the critical differences between humans and other animals is our ability to form large groups and to cooperate flexibly. Studies in evolutionary psychology and cultural anthropology suggest that the foundation of this ability is the "ability to believe in something jointly.
For example, Yuval Noah Harari, in his book "The Complete History of Sapience," pointed out that humankind was able to prosper because of its ability to believe in "fictions" (myths, religions, nations, money, laws, etc.), or "common illusions.
Belief in a common narrative, such as "we believe in the same God," "we are citizens of the same country," or "this piece of paper is worth 10,000 yen," has enabled cooperation on a scale of tens or hundreds of millions of people.
This "joint illusion" is the true nature of "faith" and "trust," which are the subject of this series of articles. We have always needed "something worth believing in" to sustain our society. And that object has changed over the course of history.
In prehistoric times, people believed in "God. Eventually, in modern times, "law" and "the state" became the object of trust. And today, perhaps the thing we believe in most strongly is "the market.
God, law, and the market. Although they differ in form, they are all "devices of trust" that mankind has created to maintain society.
In the first part, we will first overview the three eras of "God," "law," and "market," and take a closer look at what mankind has believed and how it has maintained the social order. This historical transition should help you deeply understand the inevitability of why web3, which is the subject of the second part, has emerged as a "new form of trust.
2. faith in God - absolute authority
For most of human history, it has been belief in "God" that has supported the foundation of social order. From our modern perspective, religion is often seen as a matter of personal belief, but in the past, religion was law, politics, economics, and everything else in society.
The existence of God in ancient civilizations: the relationship between religion and social order.
When humans transitioned from a hunter-gatherer lifestyle to an agro-pastoralist lifestyle and began to settle down, the size of communities expanded dramatically. In order to sustain a group of hundreds or thousands of people that transcended blood and acquaintance, a powerful story that could be shared by all became necessary. That was the birth of "God.
In ancient civilizations, gods were revered as absolute beings that governed natural phenomena and influenced people's destinies. Rituals to pray for a good harvest, sacrifices to quell plague. All of these were associated with the will of the gods and defined the code of conduct of the people.
In ancient societies, temples, as religious institutions, played an important role as more than mere places of prayer.
First, temples were "centers for the accumulation and redistribution of wealth. People paid a portion of their harvest to the temple as an offering to God. This functioned like a tax in modern times. The wealth collected was not only used to support the lives of priests and kings, but was also stockpiled in times of famine and redistributed to fund public works projects. People gave offerings because they believed that their offerings to the gods would be used for the benefit of the community as a whole.
Second, temples were "centers for the recording and management of information. Many of the earliest written records found in Mesopotamia were account books recording the number of grain and livestock delivered to the temple. Accurate records of who paid how much and to whom and how much was owed were essential to maintaining trust within the community. And it was the authority of God that guaranteed the accuracy of the records. Because "God was watching," people could not falsify their records and were willing to keep their promises.
Thus, religion in ancient societies performed a handful of functions similar to those performed by modern governments, banks, and courts. And at the center of it all was the anchor of absolute trust in "God.
Belief in God" supported the rules of the community, including the theory of royal priesthood and religious trials.
As the community became larger and larger and took the form of a nation-state, the ruling kings and emperors looked to God for the legitimacy of their power. This is the basic idea behind the theory of "divine endowment of kingship.
The king is a special being chosen by God and is God's agent on earth. By convincing people to believe such a story, the king gained absolute power. The king's commands were God's commands, and any disobedience to them was considered blasphemy.
For example, the pharaohs of ancient Egypt were worshipped as gods. Even in the absolute monarchies of Europe, the power of the king was considered sacred and inviolable, bestowed by God, and combined with the authority of the church to establish a strong ruling system.
Law and justice were also supported by divine authority. Before the establishment of the modern rule of law, the final standard for determining what was right and wrong was God's teachings, or religious precepts.
The famous Code of Hammurabi also states in its preface that King Hammurabi was given the law by the sun god Shamash. This gave the law powerful legitimacy to compel people to abide by it by declaring that it was a "divinely given law of justice," not merely a set of rules determined by a human king.
In medieval Europe, ecclesiastical law governed every aspect of people's lives. Disputes were often judged by religious tribunals, which handed down penalties such as excommunication and heresy. These penalties were so severe that they could mean social death.
There is also the "Shinmei Trial," which was conducted when the evidence was insufficient. For example, one would put one's hand in boiling water and determine guilt or innocence based on the healing of the burns. At first glance, this method seems irrational, but at that time it was seriously believed that God would perform miracles on the righteous and protect them. People accepted the results only because they believed in the absolute authority of God's judgment.
Thus, "belief in God" was a prerequisite for the functioning of communal rules (law). By setting up a transcendent being, God, people were able to have an objective standard that transcended conflicts of interest and maintained social order.
Coins minted in the name of God, oaths based on the Bible.
The power of faith supported not only politics and law, but also trust, which is the foundation of economic activity. Money and contracts are prime examples.
For money to have value, everyone must believe in its value. Historically, monetary trust was often associated with divine or religious authority.
Ancient coins were often inscribed with portraits of gods and religious symbols. Rulers sought to ensure the value of their coins by associating their own authority with that of the gods. In medieval Europe, coins were also often inscribed with a cross or the portrait of a saint. This was a symbol that the value of the coin was guaranteed by God.
People felt safe in their dealings with strangers because they believed in the sacred symbols inscribed on the coins.
In addition, economic activity can only take place when there is trust that contracts (promises) will be honored. But in the absence of a modern, enforceable judicial system, how could one guarantee the fulfillment of a contract? The answer was also "God.
From ancient times through the Middle Ages, important covenants were often made in temples or churches and took the form of an oath in the name of God. In Christian societies, it was common to swear an oath by laying hands on a Bible. This is a statement of intent: "If I break this oath, I am willing to suffer God's punishment. For the faithful, God's punishment was more terrible than any earthly penalty because it meant eternal suffering in hell after death.
This sense that God was watching, and the fear of divine punishment, served as a powerful incentive to keep the covenant. This internalized watchfulness disciplined people's behavior and sustained the trust of society as a whole.
However, this social system based on "faith in God" did not last forever. From the Middle Ages to the modern era, the absolute authority of God began to waver due to changes in social structure and the evolution of knowledge. Humanity then began to search for a new "something to believe in" to replace God. This is the "rule of law," which we will look at next.
3. the rule of law - from God to man
The era in which "God" reigned as the absolute authority continued for a long time, but from the late Middle Ages to the modern era, that authority gradually began to waver. A movement to build a social order based on human reason and consensus, rather than the will of God, emerged.
Transition from the Middle Ages to Modernity: the Reformation and the Rise of Secular Power.
One of the major factors that began to shake the authority of God was the Reformation that began in the 16th century.
Until then, the Catholic Church, with the Pope at its head, had been the sole and absolute authority in the Western European world. However, religious reformers such as Luther and Calvin criticized the corruption and skeletonization of the church and insisted that "the foundation of faith is not the church, but the Bible itself. The widespread availability of the Bible through Gutenberg's letterpress technology also encouraged this movement.
The Reformation brought about major changes throughout society. First, the absolute authority of the Catholic Church collapsed and religious authority became decentralized. With the sole monopoly of truth gone, people were forced to think and judge for themselves.
Second, through the turmoil and religious wars that accompanied the Reformation, people became acutely aware of the disastrous effects of fighting over religious beliefs. As a result, the idea of separation of church and state, that religious and political matters should be kept separate, became widespread.
The scientific revolution of the 17th century also had a major impact. Scientists such as Copernicus, Galileo, and Newton unraveled the laws of nature based on observation and experimentation. A new worldview emerged in which the world did not operate according to the will of God, but according to rational laws.
While religious authority receded, secular powers such as kings and princes grew in strength. They sought independence from the church and strengthened their control over their own territories. Thus, a new political unit emerged, the "sovereign state," with clear borders and independent governing power (sovereignty).
Sovereign nations needed a new "something to believe in" to replace God in order to maintain domestic order. This was "law" and the "state" itself.
Rousseau's theory of social contract, order formation based on "people's agreement".
When God's authority was absolute, it was believed that the social order was established by God and that people had no choice but to follow it (the theory of the divine right of kingship). However, during the Age of Enlightenment from the 17th to the 18th century, this idea was fundamentally overturned. At the center of this change was the "social contract theory.
Thinkers such as Hobbes, Locke, and Rousseau tried to answer the question, "Why do states and laws exist in the first place?" and they attempted to answer this question with the concept of the social contract.
They first envisioned a state in which there would be no state or laws, i.e., the "state of nature. Then, in order to escape the inconveniences of this natural state, they assumed that people would voluntarily cede some of their liberties and rights and enter into a contract establishing a common power (government or state).
The revolutionary aspect of this ideology was that it sought the basis for the state and laws not from divine commands or traditions, but from "the consensus of the people. This was a major shift toward the idea that social order is not something given from heaven, but something created by free and equal individuals of their own will.
In particular, Rousseau, in his "Theory of the Social Contract," argued that the state, established by the social contract, should be governed by what he called the "general will," the will of the entire community for the public good. Law, he said, is the expression of this general will.
People obey the law not because it is God's command or because it is the king's command. They are obligated to obey it because it is a rule they have set for themselves. This is the basic idea of the "rule of law.
The social contract theory is only a thought experiment, not a historical fact. However, this powerful narrative has profoundly changed people's attitudes. The joint illusion that "we are equal citizens bound by contract" was created and laid the groundwork for the modern nation-state.
Appearance of the State and Law → The object of belief goes from "God" to "institutions and laws".
With the ideological backing of social contract theory, the modern state developed "law" as the foundation of social order. This trend became firmly established through civil revolutions such as the American Revolution and the French Revolution.
The symbol of this is the Constitution. The Constitution is the supreme law that establishes the basic framework of the nation, guarantees the rights of the people, and prevents the abuse of power. People believed that by believing in the written rule of the Constitution, they could prevent the arbitrary exercise of state power and protect their own freedom and security.
The codification of law established objective rules that can be interpreted the same way by anyone who reads them. This increased the predictability of people's behavior and social stability.
However, simply creating a law is no guarantee that it will be followed. For a law to be effective, it must be enforceable in order to crack down on violations and enforce penalties. Modern states have developed elaborate institutional apparatuses (police, prosecutors, courts, etc.) for this purpose. In addition, the three branches of government (legislative, executive, and judicial) were separated to prevent abuse of power and to enforce the rule of law by mutually restraining and balancing them (separation of powers).
People trust and follow the law because they believe these institutions are functioning properly. Even if they do not know individual police officers or judges personally, they trust that the "system" will ensure fairness.
Thus, the object of trust shifted from the supernatural "God" to "institutions" or "laws" designed by human beings based on reason. Whereas faith in God supported social order through internal discipline, the rule of law is a system that supports social order through external coercion and institutional mechanisms.
However, as society has become more complex and globalized, more and more problems cannot be solved within the framework of the state alone. This is where the "market," which we will look at next, has come to be trusted by people.
4. trust in the market - the invisible hand
While "law" and the "state" formed the backbone of modern society, it was the "market" that became the flesh and blood of society and enriched people's lives. The market economy became a powerful engine for increasing the wealth of society as a whole through the free economic activity of individuals.
Adam Smith and the idea that "markets bring order".
In pre-modern societies, economic activity was often viewed negatively from a moral and religious perspective. Accumulation of wealth was discouraged as an act of greed, and economic activity was strictly limited by communal rules and guild regulations.
The 18th century economist Adam Smith revolutionized this way of thinking. In his book "The Wealth of Nations" (1776), he discussed the remarkable coordinating ability of a market economy.
Adam Smith argued that the individual is free to pursue his own self-interest, which in turn benefits society as a whole. A baker bakes bread not out of benevolence, but for his own benefit. However, when the free pursuit of one's own profit by each individual is coordinated through the market mechanism (price mechanism), supply and demand will match, resources will be allocated efficiently, and society as a whole will be enriched.
Smith called this coordinating function of the market "the invisible hand (of God)." Importantly, no one needs to plan or order with the whole in mind. Even though each person is acting in his or her own interest, order is created in the market system as a whole, as if someone is coordinating the market.
This ideology led to the idea of laissez-faire, or "free market" thinking, in which the state should minimize its intervention in economic activities. People came to believe the narrative that "leave it to the market and everything will be fine. Trust in the "order" and "abundance" brought by the market became so powerful that it rivaled trust in God and the state.
Gold standard and central banking system → Credit for money is secured by "market and state".
For a market economy to function, it is essential that the value of money, the means of transaction, remain stable. How has the mechanism for guaranteeing the creditworthiness of money evolved since the modern era?
In the 19th and early 20th centuries, many countries adopted the "gold standard. This is a system in which the value of money is tied to a real asset: gold. Central banks issued money in proportion to the amount of gold they held, guaranteeing that money could be exchanged (redeemed) for gold at any time.
Under the gold standard, the trust in money was secured by the fact that it could be exchanged for gold. Even if people did not fully trust the state or government, they could use money with confidence because they believed in gold, an asset with universal value.
However, after World War I and the Great Depression, many countries abandoned the gold standard. They then ceased gold convertibility and shifted to a "managed currency system" in which the central bank regulates the amount of money issued at its own discretion.
Under a managed currency system, the value of money is not backed by a real asset, gold. What, then, guarantees the credibility of money?
It is the "credibility of the state" and the "confidence of the market.
Central banks are responsible for maintaining the value of money through monetary policy in order to achieve price stability and economic growth. People use money because they believe that the central bank has the ability and will to conduct appropriate policy operations. The economic strength and political stability of a country also affect the credibility of its money.
Thus, the modern monetary system consists of the "state (central bank)" providing the institutional framework and the "market" evaluating the country's economic strength and policy management. We can believe that a mere piece of paper printed by Fukuzawa Yukichi is worth 10,000 yen because we believe that this entire complex system is functioning.
Globalization and market universalism are spreading today.
In the second half of the 20th century, especially since the end of the Cold War, the market economy swept the world. As globalization progressed, people, goods, and money began to move freely across national borders, and the world was integrated into one huge market.
From the 1980s onward, "neoliberal" policies aimed at deregulation, privatization, and smaller government were promoted. policies aimed at deregulation, privatization, and smaller government.
People enjoyed the economic growth and affluence that the market brought, and they increasingly put their trust in the market. The myth that "the market is always right" and "let the market solve everything" was born.
But faith in the markets has never been rock solid, and the Lehman Shock of 2008 exposed the limits of market universalism and the fragility of the financial system. Overly complex financial instruments made it difficult to properly assess risk, and the greed of a few market participants brought the entire system to the brink of collapse. Ultimately, a massive injection of public funds by the state was required to remedy the market failure.
While the market economy pursues efficiency, it has also brought negative aspects such as widening inequality and environmental problems. We are now beginning to realize the limitations and fragility of the "market" system, even though we believe in it.
5. summary
In the first part of this report, we have reviewed how the "beliefs" that humans have held in order to sustain society have shifted over history.
What we "believe" has changed from God → Law → Market.
In prehistoric times, people believed in "God. God's absolute authority was essential in setting community rules and maintaining order. The sense that "God is watching" governed people's behavior and supported trust in society as a whole.
In the modern era, "law" and the state replaced God as the object of trust. Based on the theory of social contract, people established rules by their own consent and tried to ensure their fulfillment through institutional mechanisms. The "rule of law" was a new form of social order based on trust in human reason.
And today, our strongest belief is in the market. Our faith in the efficiency and abundance that the market mechanism brings has become the driving force of our global society.
However, it remains the case that "believing in someone/something" is still the premise of the community.
The subject of "what we believe" has changed, but one thing has remained the same: we still need to believe in someone/something in order to sustain our society. That is that we still need to "believe in someone/something" in order to sustain our society.
God, law, and the market. These are all "devices of trust" for strangers to cooperate with each other, the "common illusion" we all share. Without this common illusion, society would not exist.
And none of these devices of trust has been perfect. Heretics have been oppressed in the name of God, injustice has been committed in the name of law, and inequality has grown in the name of the market. Each time we have experienced these failures and limitations, we have updated the nature of trust.
In the next issue, we will consider whether "code" can be an object of trust based on this process.
And now we stand on the threshold of a new era. The evolution of the Internet and digital technology is exposing the limits of existing trust frameworks (the state, the market, and the giant platform companies of the Web 2.0 era) while at the same time creating new forms of trust.
That is trust in "code," or the web3 worldview.
Written by program code and enforced by blockchain technology, the rules do not allow for arbitrary human interpretation or tampering. It is a new form of "law" that is transparent, fair, and automatically enforced.
In the second part, we will take a deeper look at this historical trend, why "code" is now the new object of trust, and how web3 can change our society.
Disclaimer：I carefully examine and write the information that I research, but since it is personally operated and there are many parts with English sources, there may be some paraphrasing or incorrect information. Please understand. Also, there may be introductions of Dapps, NFTs, and tokens in the articles, but there is absolutely no solicitation purpose. Please purchase and use them at your own risk.
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mitsui
A web3 researcher. Operating the newsletter "web3 Research" delivered in five languages around the world.
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*Please note that this newsletter translates articles that are originally in Japanese. There may be translation mistakes such as mistranslations or paraphrasing, so please understand in advance.