When humans lived in small tribes the first name was enough. Humans needed names to tell stories about each other. The set of stories told about an individual formed his reputation. Some individuals became known as great hunters while others became known for their laziness. Individuals needed to know others’ reputations to determine who to work with and who to mate with.
As human societies grew and people began to travel more, last names developed to disambiguate people. Many last names originally signified a place of origin or a parent’s name. Family names were also used for administrative purposes by governments1. Much like first names, last names became important signifiers of reputation. For example, the son of a great doctor might take up the family vocation and take advantage of his father’s reputation. He could then go to another town which had heard of the father and set up a business. On the other hand, if the father was a known charlatan, then the son might have a much harder time. Last names gave individuals additional incentive to develop reputations because those reputations would be carried over to future generations. The practice of dueling and defending the family honor arises from such motives.
The importance of names is also evident in many societal norms. Names are typically difficult if not impossible to change. There are large taboos against lying about one’s name. Honorific or professional titles such as “Sir”, “Dr.” and “Baron” become permanently attached to names as rewards. Titles remain informative about individual rank and accomplishment to this day.
As the scope of human affairs expanded, it became difficult to verify the reputations of individuals that were from a different region or worked in a different field. However, reputation was still important for business and statesmanship. Guilds and other forms of voluntary organizations developed to enforce and guarantee a standard of conduct amongst members. Guilds increased the ability of strangers from different regions to profitably trade with each other. Society is now filled with a myriad of certifying agencies in the form of firms and universities.
All certifying agencies are flawed to some extent because they group together groups of heterogeneous individuals. For example, a degree from Harvard is a great signal of intelligence to the outside world. Nonetheless, there are many not so intelligent and lazy individuals that graduate from Harvard. As people age and get further removed from college, they must increasingly rely on “intangible” factors such as social networks and prior jobs to move upward in their career.
The problem with how reputation was tracked through much of human history was that it were geographically concentrated, hard to verify and extremely noisy. Now, information technology has enabled reputation to once again become individualized, verifiable and directly related to outcomes of interest (such as productivity).
LinkedIn, for example, aggregates data on on workers’ skills and social networks to come up with individual reputation scores for each [skill] (http://www.linkedin.com/skills/skill/Data_Science?trk=skills-pg-search). Alternatively, platforms that track citations such as Github, for software, and Google Scholar, for research, make it easier to ascertain the quality of work an individual has done in the past. Other monitoring technologies, such as physician report cards and value added scores for teachers, provide useful measures of skill in other professions. Reputations are not only be job related but also interaction related. For example, it is possible to find out if an individual is good at paying off debts or is a good guest on Airbnb.
In the near future, individuals will be associated with a myriad of reputation measures. Access to many of those reputations will be as simple as a Google search. Each reputation will represent a potentially valuable asset. There will be an increased incentive to behave “well” in order to keep such an asset. Furthermore, because everyone will know that there is an increased incentive to behave well, they will trust each other more. There is good evidence and theory that more trust between individuals leads to more economic activity. [For example] (http://www.kellogg.northwestern.edu/faculty/sapienza/htm/cultural_biases.pdf), Guiso, Sapienza and Zingales show that pairs of countries whose citizens trust each other more tend to trade and invest in each other more. The willingness of individuals to participate in Airbnb and Couchsurfing is just the first manifestation of the trend towards more trust between strangers. In the future, meeting and transacting with strangers will be increasingly common. The benefits of universal reputation might be enormous.
Nonetheless, universal reputations come with salient costs such as diminished privacy. A future post will discuss the pitfalls of universal reputations.
Legend has it that Emperor Fu Xi standardized his subjects’ last names in 2852 BC. ↩