A new sandpit for long side discussions, conspiracy theories, idees fixes and so on.
To be clear, the sandpit is for regular commenters to pursue points that distract from regular discussion, including conspiracy-theoretic takes on the issues at hand. It’s not meant as a forum for visiting conspiracy theorists, or trolls posing as such.
19 thoughts on “Sandpit”
A few snippets I read recently prompted the following thoughts. The first snippet was:
“We exist in a bizarre combination of Stone Age emotions, medieval beliefs, and god-like technology,” – E. O. Wilson.
The other snippets are numbered with my thoughts below them.
(1) “We are wired to live in a Malthusian trap, yet we have escaped.” – Peter Radford.
Actually, we have not escaped. We are still in something like the “Malthusian Trap” (MT) which itself is an inaccurate model of our predicament.The case is that the MT or rather Limit to Growth is an elastic cage, not an inelastic cage. We found that certain limits to growth were elastic. They could be stretched by the application of technologies; from stone axes, to early farming and herding techniques and then on to all our modern technologies. However, even the most elastic material or system when stretched far enough will still break.
The literal MT model was inaccurate in positing that while population growth was potentially exponential (correct), the growth of food production was potentially only linear (incorrect). Under the application of technology, the growth of food production became exponential as did the growth of population enabled by the increasing food supply. The real problem turned out to be rather different. The exponential growth of impacts on the environment from exponential growth in production has exposed the system of systems that is the biosphere, inanimate and animate, to be the limiting factor. These systems provide geoservices and bioservices and are characterized by finite stores or finite flows (viewed according to which of these becomes the limiting factor in each case). The benign Holocene climate (an inter-glacial period) provided weather stable enough, predictable enough, and with good proportions of sun and rain in many regions along with soils , to produce large quantities of food with the application of technologies.
As Francis Bacon so pithily and accurately pointed out, “Nature to be commanded, must be obeyed.” We do not and cannot escape the fundamental Laws of Nature. This means that to “command nature”, which really means to stretch, bend or incline nature only, we must obey the fundamental, unchanging operation of its laws. I cannot sail a sailing vessel directly into the wind. To “command the wind” to propel my boat where I want to go, I must obey the set of physical vector forces available to a vessel designed to sail. With sails, keel and rudder I may harness the vector forces induced to act on the boat’s sails, keel and rudder to tack against the wind.
When mankind invents the steam engine, the internal combustion engine and the electric motor he still does not escape Nature as fundamental natural forces. He discovers more fundamental forces and how to harness them but still to “command” nature he must obey nature. In each case, the negative externalities on nature (biosphere systems) of harnessing these forces eventually becomes apparent. Jevons Paradox manifests itself and comes more and more into play. When technological progress “increases the efficiency with which a resource is used (reducing the amount necessary for any one use) … the rate of consumption of that resource rises due to increasing demand.” 
(2) “Have we rewritten the rules of being?” – Peter Radford.
The short answer is no. We have not rewritten a single fundamental law of nature and we cannot do so. Again, as Francis Bacon points out, and it is still relevant and will ever be relevant in this world and this cosmos for contingent, mortal, corporeal beings like humans;
“Towards the effecting of works, all that man can do is put together and put asunder natural bodies. The rest is done by nature working within.”
Look at everything we do with tools and technologies and you will see that the only thing we are doing is putting together and putting asunder natural bodies (and forces and systems). The rest is done by the fundamental forces of nature working within, or as, bodies, forces and systems. We utilize our understanding of the Laws of Thermodynamics to make more and more efficient heat engines. However, the Laws of Thermodynamics themselves put limits on the ultimate possible efficiency of heat engines. We cannot transcend those limits. We see this everywhere. We cannot transcend natural limits, except via a kind of partial and long-acting process which still will have its own kind of limits anyway.
What is or what are these “partial and long-acting processes”. These processes are those of emergence and evolution. I won’t get into emergence. That is a difficult discussion. Let us get slightly into evolution which we can regard as a special category of emergence and one amenable to empirical (scientific) investigation, as opposed to the more metaphysical investigation required by the concept of emergence. It is certainly possible that humans have evolved with and indeed do still evolve with the development of their own technologies. The opposable thumb and increasing tool use are possibly linked as parallel and mutually reinforcing developments though there is still some controversy about this.
But the observation, “We exist in a bizarre combination of Stone Age emotions, medieval beliefs, and god-like technology,” certainly has something to recommend it. Many (all?) of our emotions are very primitive. Many beliefs today are arguably still “medieval” in some senses but this judgement may be all of pejorative, arrogant and “time-parochial”. It is possible to be parochial about historical time as well as about geographical place. That technological development outpaces human cultural development and, even more, evolved human emotional development, is clearly true. We are relatively long-lived animals with a reproduction cycle of about 20 years.
But modern technology only develops rapidly with respect to human generation cycles. It develops rather slowly with respect to bacteria and virus generation and evolution cycles. We discover this when we find ourselves, as now, in a technology versus evolution arms race against a dangerous and rapidly mutating virus. People assume we are winning or are going to win this “arms race”: at least enough to protect us from losing hundreds of millions of humans to COVID-19. This may prove to NOT be the case. Viewed through this lens, technology does not perhaps appear so powerful after all and a renewed respect (of concern, love and fear) towards nature might reassert itself if we ponder such verities deeply.
The sin of pride or arrogance is real: a “sin” if viewed through certain religions and a “grievous mistake” if viewed through a scientific humanist lens. Indeed, “sin” and “grievous mistake” are partial synonyms. The homonym pun was uncovered rather than intended. The problem with instrumental science (using the term “instrumental” in the sense that it is used in the phrase “instrumental reason) in the employ of capitalists, is that it pays little attention to the possibilities of negative externalities and unforeseen consequences. It barges forward rashly, aggressively, greedily, blindly with regard only for the needs and greeds of those using and developing such technologies. Nature and other marginalized humans are brushed aside, flung into the mire, shrouded in pollutants, despoiled, infected and forgotten.
Given the grave dangers we now face, as nothing less than collapse of civilization and possibly the extinction of humans, from crises like climate change, the sixth mass extinction, the rise of pandemic zoonotic diseases from our encroachment on the wilds and so on, I think we should be much more careful about declaring and wielding technology as a nature-conquering force. If we continue to do that nature will “snap-back” or recoil, completely conquer us and send us extinct. To “command” nature to an extent suited to our own purblind and fallible human nature, and within the limits of biosphere and technology (technology too will prove to have limits) we must obey nature.
(3) “There are no predators around the corner.” – Peter Radford.
What is COVID-19? It has already killed over four million humans and counting. That worldometer count is, in many quarters where statistical work with excess deaths is done, considered to be an under-count by at least a factor of 4: meaning a count of 16 million is much more likely to be near the mark. The SARSCoV2 virus is an efficient “predator” or at least killer of humans. Scientists have estimated that, as at about the end of 2020, the total amount of SARSCoV2 virus in humans (it lives almost exclusively in humans apart from fleeting transmission journeys) was of the order of 0.1 kg to 10 kg. Let us take a middling 1 kg estimate. That mass of virus can kill many millions, put many more millions at risk, outstrip science by rapid evolution and confound the medical and political economy systems of most of global humanity. How powerful is nature! How puny are humans and their science! And this ignores the consistent great predator of humans throughout all civilizational history: other humans! Homo homini lupus est. Man is a wolf to man. We have a lot of developing to do and it is not technological. It is moral and involves the abandonment of the prescriptions (axioms) of market fundamentalism and selfishness.
1. The soils of Iowa and surrounds were “bulldozed” there by the glaciers of the last ice age. The Canadian shield sort-of north of there is scraped rock covered with much shallower soils.
Ikon, maybe the two featured quotes need combining;
“We are wired to live in a Malthusian trap, yet we have escaped.” … and now …“We exist in a bizarre combination of Stone Age emotions, medieval beliefs, and god-like technology,”.
July 27, 2021 @ 7:50 am
…” The problem with instrumental science (using the term “instrumental” in the sense that it is used in the phrase “instrumental reason) in the employ of capitalists, is that it pays little attention to the possibilities of negative externalities and unforeseen consequences.”
Björn Goldstein says in link below;
“This ontological materialism is hardly spoken of within the field, as it is an unchallenged assumption among most psychologists and social scientists,”
And “These beliefs are usually not part of research presentations even though they have tremendous influence on the results of the whole research process.”
Ikon, I’m glad you try to elucidate hidden beliefs, and challenge assumptions.
Mainstream dualists may have a problem (opportunity) with these articles.
And your comment above Ikon is, I think, a synopsis for the book you are going to write. Seems to hit all your marks in one polemic / rant / comment.
I scan ‘Constructivist Foundations’ and occasionally dip into a long thread. I like the Open Peer Commentaries as it provides a window into expert commentary of another, and wrapped by Target Article from initial author.
CF is set up as;
Björn Goldstein’s article linked below
Then “Open Peer Commentaries” – 6 in all
Then “Author’s Response” (link at site) “Humble Research and the Inescapability of Limited Knowledge” Björn Goldstein
The Target Article;
“Materialism and Selection Bias: Political Psychology from a Radical Constructivist Perspective
By Björn Goldstein (2021)
“Context: Political psychology rests on the assumption of the existence of a world outside and independent of consciousness. This ontological materialism is hardly spoken of within the field, as it is an unchallenged assumption among most psychologists and social scientists, including political scientists. However, the materialist paradigm frames research designs, the interpretation of data and theory building. Also, there is a bias towards psychological universals – the claim that all individual and group psychologies are equal (as compared to cultural psychology, which is critical about universalist claims), which can be understood as a consequence of the discipline’s hidden ontological core assumption.
“Problem: The purpose of this article is to show how the choice of a certain approach to answer a research question rests on the deeply ingrained beliefs of researchers. These beliefs are usually not part of research presentations even though they have tremendous influence on the results of the whole research process. Recipients use these necessarily biased research results as building blocks for the construction of their own realities.”…
[Is this ‘Double-aspect theory’ monism? ^1.]
. .” Political psychology is based on the highly problematic assumption of an ontic world that exists independently of a subjective observer. It can serve as a telling example of how the preoccupation with a physicalist world explanation can lead to methodological and interpretative biases.”
Constructivist Foundations 16(3): 327–338
“A radical constructivist approach to boundaries in business network research
…” The approach appears most useful when the researcher and interview participant do not have a convergent understanding of the research phenomenon. Further, a radical constructivist approach is eminently suitable for settings where inter-action conditions and content are changing, for example in times of crisis or network change. We present the metaphors of castles and frontiers, as illustrative research tools suitable for a radical constructivist study of boundaries in business networks.”
Off topic sort of … it seems Karl Friston leans toward monism; … ” why are psychiatric disorders and immune responses intertwined? To address this would require a step back from a historical mind–body dualism that has created such a dichotomy.”…
Ikonoclast, not to alter your point, but an aside re your example of harnessing vector forces and sailing, “This means that to “command nature”, which really means to stretch, bend or incline nature only, we must obey the fundamental, unchanging operation of its laws. I cannot sail a sailing vessel directly into the wind…”
It is possible to sail directly up wind using gearing to match impedance between a solely wind powered rotating sail plan (turbine) and a rotating propulsive output device such as a propeller on water or wheels on land. Yet more amazing is that such vessels or vehicles are able to sail directly downwind faster than the wind!
Due to assorted drag factors maximum speeds are limited by corresponding wind speeds. Those drag factors are infinitesimal or absent in space.
So perhaps it is possible to do space travel likewise by harnessing solar winds? If so one could move away from a star increasingly faster than its solar wind. At some intermediate point depending on relative star types and size, as solar wind power would mostly be inversely proportional to the square of the distance from a star the switch would be made to moving directly into the solar wind of the star of destination at first increasingly faster than its solar wind until it came time to brake by using the solar sailplan conventionally…
KT2 (and then for all concerned about the ontology of economics),
Thank you. The Constructivist site looks interesting. I will see if I can utilize it. There seem to be “schools” within the constructivist camp. I might match one of them or I might be somewhat different from all of them, in my position. I have been trying off and on for quite some time to get a genuine economic ontology debate going on this blog, without much success.
I think the ontological debate is fundamental to economics. The issue is this. What in economics is of the nomos (culture, custom, legal law, regulation and etiquette) and what in economics is of the physis (material reality as dealt with by disciplines from physics to real economy quantity calculations). Economics to my mind has not come to terms with its own nature as a discipline. What of economics is “nomos axioms” (pure prescription) and what of economics is “physis axioms” backed by empirical data to a “hard” level equal to that as physics, chemistry and biology as hard sciences.
It will sound somewhat paradoxical to talk of “physis axioms”. But we do actually develop axioms to help us deal with the physis. And I do mean axioms here, not heuristics (which we also use to help us deal with both the nomos and physis). Euclidean geometry is an example of a formal system with “physis axioms”. Physis-axioms as I term them are abstracted or induced (produced by philosophical induction) from empirically detectable reality and are measured in what are now the SI units.
Even the Greeks had produced by empirical observation and natural philosophic induction proto-SI units, for example for length, and for some of what are now termed permitted non-SI units, in particular a measure for angles. Physis-axioms approximate, sometimes closely approximate, some relations (laws of relation) of the physis, and permit accurate calculations of, and accurate predictions for, parts or systems of the physis. However, these physis-axioms have validity only within boundary conditions. Euclidean geometry is only valid for flat plane surfaces or near-valid for near-flat plane surfaces. Newtonian physics is only valid under a number of limitations too. Only for cases where relative speeds are a tiny fraction of the speed of light, only valid for rigid bodies, only valid where a universal frame of referencei is assumed, only valid where pure empty space is assumed etc. etc. Even Eisenstein’s General Theory of Relativity makes certain physis-axiom assumptions. I won’t go into here until I brush up on that.
The only justification for making any physis-axiom assumption in science is that they permit (if good-enough approximations of essentially unknown full reality for some scientific or pragmatic purpose) degrees of explanation of causation (so-called) and hence the ability to utilize cause-effect reasoning (also a physis-axiom assumption by the way) to make dependable predictions.
There is a key but subtle and extensive difference between nomos-axiom and phsysis-axiom statements. Physis-axiom statements in and of themselves do not and cannot (so far as we can determine) change the fundamental laws of the physis be they completely false and hence refutable by experiments or be they good-enough approximations of essentially unknown full reality for some scientific or pragmatic purpose. Physis-axiom statements are descriptive of apparently non-alterable fundamental laws and relations of the physis..
Nomos-axiom statements may be of two or even several types. They change color like chameleons or perhaps “shape-shift”. They may attempt to be descriptive, they may pretend to be descriptive when really prescriptive and they may be openly and avowedly prescriptive. Conventional economics, to my mind it has a great deal of trouble analyzing its nomos-axiom statements and properly characterizing and categorizing them.
I can continue this discussion if I spark any interest. I’ve even introduced a new (modelling) dualism (physis-nomos) when I have nailed my colors to the mast of priority monism. Please someone engage, even to robustly attack my ideas on that or any other front. I consider that I can answer your objections. This has to do with systems ontology specifically formal system – real system ontology in a monist framework.
Ikon, I am barely able to “… engage, even to robustly attack my ideas on that or any other front.”, yet I am more than happy to enter a dialogue.
As a single parent, (and relatively, compared to some domain experts here), ignorant. And there are no philosophy experts here unless they never post.
Perhaps a note to the editor or Constructivist Foundations suggesting your prefered angle for a ‘Target Article”. Several other constructivist journals.
And a book. You’d be a shoe in for a masters at some uni to study Economic Philosophy. With a body of examples – this blog – your subject knowledge, prose power and agency would see a worthy publication appear imho. If you added up your words here I’d say you write a thesis every month! What have you got to lose?
Ernestine, any encouraging words for Ikon and a Masters thesis?
Galbraith says below, economics history is dead. Economics philosophy is the dodo then, it would seem.
And we are rushing towards “Economic reasoning and artificial intelligence” (below), as we haven’t even sorted our philosophy yet. The paper linked says they are up to 3 agents! Crypto level Co2 emmisions then to simulate ‘us’. And in Monday Msg Bd when out to moderation, you can read;
“Limits to Growth on schedule.
“MIT Predicted in 1972 That Society Will Collapse This Century. New Research Shows We’re on Schedule.. ..”
Plenty of work still for you to do Ikonoclast!
Jul 23, 2021
JAMES K. GALBRAITH
“Although neoclassical economics relies on assumptions that should have been discarded long ago, it remains the mainstream orthodoxy. Three recent books, and one older one, help to show why its staying power should be regarded as a scandal.
– Mason Gaffney and Fred Harrison,The Corruption of Economics,Shepheard-Walwyn Publishers Ltd., 2006 (first published 1994).
– Stephen A. Marglin, Raising Keynes: A Twenty-First-Century General Theory, Harvard University Press, 2021.
– Alessandro Roncaglia, The Age of Fragmentation: A History of Contemporary Economic Thought,Cambridge University Press, 2019.
– Robert Skidelsky, What’s Wrong with Economics?: A Primer for the Perplexed, Yale University Press, 2020.
“AUSTIN – Self-regarding economics departments at prestigious academic institutions no longer bother to teach the history of economic thought – a field that I studied at Yale University in 1977, forever compromising my academic career. Why was the topic abandoned – and even shunned and mocked? Students with a skeptical turn of mind would not be wrong to suspect that it was for scandalous reasons (as when, in past centuries, inconvenient aunts were locked away in garrets).
“The four books reviewed here each uncover parts of the scandal. Three are brand new, and the other, The Corruption of Economics, first appeared in 1994 and was re-issued in 2006. Its principal author, the American economist Mason Gaffney, kept his remarkable pen flowing until passing away last summer at the age of 96″…
“Economic reasoning and artificial intelligence
“Economics is drawn to rational decision models because they directly connect choices and values in a mathematically precise manner. Critics argue that the field studies a mythical species, homo economicus(“economic man”) and produces theories with limited applicability to how real humans behave. Defenders acknowledge that rationality is an idealization but counter that the abstraction supports powerful analysis, which is often quite predictive of people’s behavior (as individuals or in aggregate). Even if not perfectly accurate representations, rational models also allow preferences to be estimated from observed actions and build understanding that can usefully inform policy.”
Well done! This comes under the heading of a “counter-intuitive” STEM concept. I concede defeat in my example which would have been saved by my wording it more carefully as “when I sail a CONVENTIONAL sail craft” etc. I do not of course concede defeat in the contention based on Bacon. To “command” nature you must obey nature (meaning all its fundamental Laws)
I was thinking conventionally with the windmill driving the wheels. Strangely, on the land craft the wheels drive the windmill or propeller. It would gain its initial start from “windage”, the force of wind on the body (rear projection) of the craft and on the stationart sails or blades. It then functions as best I can tell as a continual harvester of wind energy at any speed. This video makes the case best for faster than wind speed downwind..
I was skeptical considering boats because I envisaged the conventional employment of the windmill or air propeller to drive the water propeller. I was not imaginative enough or experimental enough or “physics-y enough to imagine the reverse deployment. The reverse deployment however might suffer upwind due to higher friction losses with water and “screws” (water-propellers). Indeed, can these contraptions work upwind or only downwind? Does the drive have to be reversed for upwind? Another good question to which I do not know the answer yet.
I will discuss all this with my sailing, contraption building and 3D printer owning brother. I mean this is a guy who owned/owns a metal turning lathe under his house for fun and practicality and turned both metal items and wood furniture on it. He even made nylon bushes for his front-wheel drive Lancia’s, front wheel bearing set-up.
This ranks with other non-intuitive physics “conundrums” like (sometimes reverse cycle) heat pumps which can do more cooling or heating in energy terms than the energy put into the driving motor. See Heat Pump on Wikipedia. In each case, the windmill car and heat pumps, the “law” against a perpetual motion machine or “energy from nowhere”, namely the conservation of energy, is not broken.
The video of “The bizarre behavior of rotating bodies” is also worth watching.. In all cases, fundamental and known physics laws are not broken.
I think it is wonderful we are talking about science and empiricism in an economics blog. It happens so rarely. My basic contention is that economics is a hybrid discipline with a hybrid ontology which it has not properly come to terms with. This ontology is of both a real system nature and a formal system nature. Conventional economics has in my view NOT developed a method to properly categorize formal and prescriptive axioms, “nomos-axioms” and real system “physis-axioms” as I term them. There are more complexities as the one really shades by many degrees into the other, as we would expect in a monist system. Further and very importantly “nomos-axioms” generate agent (human) behavior and humans are material beings. Thus “nomos-axioms” can generate what we can call emergent behavior or downwards causation. See for example the topic on Downward Causation on Wikipedia. When upward and downward causations occur, we are now talking about dialectics (Hegel to Marx) or feed-backs (complex systems science.
I would dearly like someone to tell me where they think the axioms of Generalized Expected Utility are derived from. Are they derived from the physis or the nomos? Or are they hybrid axioms derived from a given nomos (capitalist property laws and markets) and then “physis-ized” by delineating how these prescriptive axioms make real people behave? Or are they of physis origin and then emegently generating nomos-norms in the other direction by a kind of memetic evolution of the “fittest rules” (this being an arguably valid concept. Or are they some hybrid of the above which is also theoreatically possible as multiple feedbacks between the nomos and the physis?
Following my assumption of a conventional or unimaginative deployment of the windmill, I considered
as follows. This would seem on first blush to break Newton’s Third Law of Motion and some subsidiary considerations to do with friction and energy losses. When I think of going downwind faster than the wind, I think maybe but still doubtful. The problems will be with energy losses(friction turned into heat and sound). Newton’s 3rd Law – “The third law states that all forces between two objects exist in equal magnitude and opposite direction: if one object A exerts a force FA on a second object B, then B simultaneously exerts a force FB on A, and the two forces are equal in magnitude and opposite in direction: FA = −FB” Wikipedia.
FA = – FB
We can work with Newton’s so-called 4th Law, added after, not by, Newton. This can be short-handed as follows: “Forces add like vectors.”
Then I envisaged the windmill driving the wheels or water screw and losing force downwind with icnreased speed and not gaining enough force upwind, plus being affected by energy losses to friction, turbulence, heat, noise.
Well, yes I’d encourage Ikonoclast to do a higher degree, if he wants to. In my reading of Ikonoclast’s posts, I could imagine his first difficulty would be to narrow down his list of connected topics to something manageable for an academic degree. This is a quite common experience, particularly for those who have thought about questions of interest to them before embarking on a thesis, in contrast to those who are being given a topic by a Professor. I am confident in saying, Ikonoclast would not thrive in a system where he would have to work on a topic given to him by a Professor. So, I believe he would have to crystallise in his own mind what is the crucial topic for him and then look for a supervisor.
Iconoclast, I recall you have posted a question on ‘rationality’ in economic theory (western) and you asked for anything as long as it is in words. I had nothing to offer. I am currently reading “The Psychology of Stupidity” by Jean-Francois Marmion. This book contains several papers by various authors, which deal with rationality, starting with ‘the economic man’ to something which I can relate to in contemporary economic theory (western). If you want to, I’ll extract the relevant chapters and write a few words on how it relates to economic theory in a historical context.
Thank you. I would much appreciate your offer, if you have the time and feel the interest. You are also correct about how I would fare at University. I am 67. I have a very old B.A. in media studies including literary, TV and cinema criticism.
It is too late for me to do a post-grad or PhD degree. In theory, I think I’d be looking at Empirical Philosophy, in the field of Priority Monism and Complex Systems. That’s the direction where I think the action and the progress are. But I don’t have enough years left to get an education and make progress. It just seems absurd in my case. Indeed, I also believe that failure to achieve potential by 67 is a good empirical sign of no real potential at all. There are late bloomers and then there are never-bloomers. It’s not a judgement I would make on any one else but I do make it on myself.
Nevertheless, I find the attempt to understand something like the field named above very interesting. I found a connection, an ontological connection, between virtual modelling of dynamic representational game systems utilizing space, time and AI agents, the conundrums of economics, complex systems theory, general theories of modelling and the correspondence theory of truth. I took the Monist Immaterialism or Idealism of George Berkeley, kept the Monist a priori as it abolished the “transmission problem”  of dualism, and placed the “Absolute” (if it existed at all and generated the material) outside the real system under discussion. That last is certainly not original.
However, placing everything else in one monist material system means, IFF correct, that the (humanly generated) formal is logically a sub-set of the real. This seems paradoxical but it is supportable and leads to some interesting conclusions. Real systems and formal systems then present as epistemologically separate categories but not as ontologically separate categories. Why epistemologically separate? Because we know what we put into formal systems but we do not know what is in real systems as we did not generate their content. Why ontologically connected and indeed monistic as a whole? Because real systems and formal systems share matter, energy and crucially information.
What is the distinguishing characteristic of our formal systems? They possess a high information content to mass-energy ratio. This is precisely what makes (valid) formal systems useful to us. Information as patterns is instantiated in real systems, in real media. These patterns are used as templates for real system manipulations. This is true of DNA and it is true of human formal systems. For human formal systems, an agent (human) is necessary as a formulator, coder and de-coder of a formal system or an expression (like an equation) in a formal system.
Where does this lead us? Well pure analysis must precede practical application of course. Matters are not entirely clear yet to me but I can see some very promising signs. It suggests straight off that prescriptive or normative formal systems can and should never ignore the full panoply of real system fundamental laws thus far discovered. Otherwise, to put it simply, the formal system prescription or instruction is not executable or not executable sustainably in the real world. All of this centers around truth correspondence as the necessary homomorphic correspondence of formal models and formal prescriptions to the real.
In your economic analytics you insist on axioms which are homomorphically correspondent with the real. Hence the insistence on time and space modelling for example. What is more and this is crucial, you insist in this case on homomorphic correspondence with real scientific dimensions covered off in the SI table. This ensures you develop, as I term them, physis-axioms not “mere” nomos-axioms. Euclidan geometry also develops physis-axioms for example. Thus your theorems being physis-axiom determined, albeit in a formal system, are more likely to demonstrate validity in the test agaisnt real systems.
However, in the case of Generalized Expected Utility (and I am still working on this) I have more concerns. This is a function, as I understand it, intended to explain the emergent and expressed behaviors of agents (humans); creatures who show not just upward and downward causation in their behaviors but also a portion of downward causation that is programmed by prescriptions and norms (in a soft logic or fuzzy logic way) and also directed by institutional channels. The intent to derive hard Laws from GEU would seem to be wholly undermined by the programmable and reprogrammable aspect of the agents (humans) who are both quasi-autonomous with endogenous impulses and quasi-prgrammable by exogenous means of teaching, direction, enulturation etc. The diagnostic alarm of “problem theory” is set off in our minds by the use of a non-SI dimension, namely “utility” in the theory. Now “utility” is a fair theory in a number of respects but it is not objectively quantifiable. Hence it remains a moral philosophy theory essentially not a physis-axiom likely to give objective enough results to permit usable cause-effect deductions and predictions that are not nomos conditioned. Now I may be out of order and GEU theorists can argue here of course.
OMG, I hope this has made some sense. LOL. I shouldn’t blog late at night.
Note 1. The transmission of effects between two different “substances” using this term as in substance philosophy and referring to material and mental substance (res extensa and res cogitans).
On the Malthusian Trap, on a first pass it looks to me like birthrates are, as is widely accepted, exponential and agricultural production grows linearly. A second pass and I think agricultural production with technological progress isn’t linear, it will be more like an S-curve. They do look very similar at first. A third pass and the reduced birthrates associated with education, prosperity and healthcare (including contraception) suggest an S-curve as well. A fourth pass and I think the sustainability of that level of prosperity to support reduced birthrates looks like a relevant question – an S-curve with a cliff. A fifth pass and I have to conclude my ignorance exceeds my knowledge; population will hit up against hard limits and global warming will shrink and harden those limits.
I don’t see imposition of population control/birth limits as within our capabilities or is acceptable except on a them, not us basis. Certainly not without crossing into crimes against humanity territory – no matter that continuing population growth will increase the likelihood of disastrous outcomes that will include even worse crimes against humanity.
Generalized Expected Utility (GEU)
I refer here to a Stanford Encyclopedia of Philosophy article called, “Normative Theories of Rational Choice: Expected Utility”. It states early on that:
“This article discusses expected utility theory as a normative theory—that is, a theory of how people should make decisions. In classical economics, expected utility theory is often used as a descriptive theory—that is, a theory of how people do make decisions—or as a predictive theory—that is, a theory that, while it may not accurately model the psychological mechanisms of decision-making, correctly predicts people’s choices. Expected utility theory makes faulty predictions about people’s decisions in many real-life choice situations (see Kahneman & Tversky 1982); however, this does not settle whether people should make decisions on the basis of expected utility considerations.”
This makes sense to me. It is eminently possible and feasible that GEU could be developed as a normative theory, a theory of how people should make decisions. Specifically, one can envisage this as happening in the macro policy space. That makes sense to me.
I will use the example of person A, a person from a COVID-19 ravaged country, non-citizen, non-resident of Australia, who is permitted to travel to Australia on a work visa to perform work of economic benefit or dubious economic benefit. Thus A could be a fruit picker or A could be a ratbag media opinionator with strong science-denialist leanings. Both of these cases are cases we have seen recently, albeit they have not necessarily actually been COVID-19 carriers. But I think we have also seen such cases where such people have turned out to be COVID-19 carriers infected in their country of origin country or infected on the plane to Australia.
The issue is this. What is the GEU of a fruit picker or a shock-jock style opinionator? What is the negative GEU of a delta strain outbreak like the one in progress in Sydney? It has to be noted that the one in Sydney was started by a flight crew member of a Fedex flight. Again, what is the GEU of the Fedex plane’s contents or all Fedex plane contents? That will certainly be larger of course.
Let us run through them.
(a) The GEU of shock-jock style opinionator = – x (such a person is a saboteur of science based policy and hence of the people, economy and nation).
(b) The GEU of all fruit pickers on visas = y
(c) The GEU of all air cargo into Australia = Z (clearly a high value this time).
Would not GEU, calculated according to the best theory and mathematics, permit an assessment that;
(1) The shock-jock style media opinionator should not get a visa.
(2) The fruit-pickers should not get visas. Instead, subsidized ways should be found to give Australian unemployed, including foreign students stuck in Australia, sufficient incentives to fruit-pick.
(3) Exclusive purpose-built quarantine or re-purposed quarantine for cargo flight crew should be paid for and set up. Limos with hermetic air-con sealing of driver from passengers and the wearing of masked etc. should be strictly enforced.
Surely, GEU applied to macro policy settings and regulations would tell us to do something very much like the above? While we could not hope to act like a GEU powered decision maker as a consumer at the local supermarket, we surely could hope that the governments and authorities would take economic GEU advice for macro-economic decisions as well as taking full epidemiological advice from the start of the pandemic? To date, both hopes have been in vain.
Downwind Faster than the Wind (DWFTTW) on Land.
Svante brought up the topic of DWFTTW. This is a really hard thing to wrap one’s head around but I think I finally get it. I needed help from commentaries by Mark Drela, MIT Aero/Astro. I also needed help from my brother, an aero-modeller extraordinaire.
Mark Drela first explains how high-performance sailing craft, like hydrofoil sailing boats, with conventional sail rigs (or a vertical wing), sail downwind. They tack downwind at about 135 degrees (where 0 degrees would be straight back into the wind and impossible for a sail craft and 180 degrees would be directly downwind). These craft can go much faster than the wind on this reach which is called a three-quarter reach. Let us assume a wind speed of 10 kph. One of these sail craft can do maybe 25 to 30 kph on this reach with a 10 kph wind. The reason is their own motion shifts the apparent vector of the wind forward on the boat so that it is about 45 degrees ahead of the beam (side) and thus only 45 degrees from straight ahead on the boat. This apparent wind is much faster than 10 kph. I leave people to do their own calculations by Pythagoras’ theorem. This higher speed apparent wind gives the sail greater lift and the boat more speed.
It’s not really the mass of air ejected backwards out of the sail that gives most of the drive to the boat. It’s the low-pressure area on the lee side of the sail (opposite the windward side). This gives lift just like a plane wing gives lift. The lift would push the craft sideways, to the lee, but for the keel in the water. This channels the sideways lift or push into forward motion. These craft go faster downwind than the wind, even in the direct vector of the wind. By using two downwind tacks they would beat a released balloon to a direct downwind marker or buoy.
Mark Drela explains it like this. Imagine you curled the surface of the sea into a tube facing downwind with the sea surface on the outside of the tube (easier to imagine this way). Then the path of the sailing craft going downwind on a single tack could be represented with one line. This path is a helical spiral down the outside of the tube. The sails (or sailing wing) would describe a spiraling helical path whose axis and vector are direct downwind. Keep this helical path in mind. It will come back to conceptually rendezvous with us.
Now, we make a land yacht with wheels to run on a salt flat and we have an air propeller mounted facing the back of the craft. The propeller is connected to the solid back axle and its fixed back wheels by a drive train (a twisted belt drive would work because the back axle is at right angles to the axis of the propeller). The propeller blades are angled (called pitch) such that if an engine drove the propeller with the correct rotation, it would push air back against the incoming wind when going down wind. However, this propeller is not driven by an engine and something rather different happens.
Imagine this propeller turning, but it is NOT driven by an engine turning it and counterintuitively it is turning NOT in the direction it would turn if it were a free-wheeling windmill but in the other direction as if turned by an engine! We will come back to why it does this. But first, consider each blade of this propeller. Its motion makes it just like a sail cutting downwind, bringing the apparent wind forward on the propeller blade and creating lift on the downwind side of the propeller blade: that is, in the downwind direction we want to make the land yacht travel. There is a high-pressure zone on the upwind side of the propeller and a low-pressure zone on the downwind side of the propeller. It is this “lift” that drives the land yacht downwind. The “lift” is a pressure differential.
We can imagine the path of the tip of each blade of the propeller as it turns and the land yacht moves downwind. This path will be a spiral helix downwind. But because the propeller turns rapidly it is a closely compressed spiral helix running downwind on the axis of the land yacht’s forward motion. The helix concept comes back to show us that the propeller blades are doing the same thing as the sails were in the Drela idealised model example; taking a spiral helix path downwind. In reality of course a high-performance yacht takes a flat plane zig zag path to the downwind marker.
How and why does the propeller turn the opposite way to a free-wheeling propeller? This is intriguing. The drive connection permits the wheels to drive the free-wheeling propeller in the seemingly “wrong” direction. The force or push on the land yacht is pushing the land yacht downwind (as high pressure on the prop at the back side of the vehicle and low pressure on the other side of the prop facing the direction of travel). The wheels are the land yacht’s equivalent of the keel on a sea yacht. But instead of preventing side-slip they apply a counter-force of enough strength to make the propeller rotate in the “wrong” direction compared to a free-wheeling windmill. The land yacht would lose some energy in this manner but strangely gain most of it back (I think) by making the propeller counter-rotate, bringing forward the apparent wind on the prop and increasing the wind’s apparent speed.
This is all really hard to explain in just words. It really needs diagrams and models. Another way to think of it this if you know what a gyro-copter is and how it works. Or think of a helicopter which has lost power. Such a helicopter can act like a gyro copter and glide to a landing (if the back rotor is still doing its job, at least in theory). Now imagine this gyro copter style craft in an updraft. It could gain altitude. Rotate this concept though 90 degrees. The updraft is now a wind. And the land yacht, as it has become now travels forward, down-wind.
Can anyone understand these concepts just from words? You are doing darn well if you can. I HAD to understand this but needed a lot of help and diagrams. It gave me two restless nights. Well, I am in my own lock-down post eye-operation. Going a little stir crazy here. 😉
Ikon, JQ effected K&T’s propect theory. Can’t find reference. JQ correct me if I am wrong please.
Thought you’d know of JQ’s history.
Minor expected utility reading list.!
Expected utility theory, prospect theory, and regret theory compared for prediction of route choice behavior
Generalized expected utility theory : the rank-dependent model / John Quiggin
– Local utility functions and local probability transformations [electronic resource] / John Quiggin and R…
– Background risk in generalized expected utility theory [electronic resource] / John Quiggin
– Increasing and decreasing risk aversion for general preferences [electronic resource] / John Quiggin and…
– Mark-up pricing equilibria under uncertainty / Simon Grant and John Quiggin
– Economic solubility of the agency problem with state-contingent production [electronic resource] / John …
And top 2 cited papers;
“A theory of anticipated utility
Journal of Economic Behavior & Organization 3 (4), 323-343, 1982
Cited by 3575
“Generalized expected utility theory: The rank-dependent model
Springer Science & Business Media, 2012
Cited by 1049
“Behavioral Public Sector Economics
Richard W. Tresch, in Public Finance (Third Edition), 2015
“KT’s prospect theory deserves special attention because it is the most fully developed of the behavioral theories.”…
…” spect theory paper, it was known that any nonlinear weighting of probabilities could yield violations of stochastic dominance (Handa, 1977). The insight of rank dependent utility(Quiggin, 1982) is that stochastic dominance is based on comparisons of cumulative distributions, so the fix is to apply the weight to the inverse cumulative distribution (not to the probability density) in order to preserve stochastic dominance. With only two events, as is the case for the gambles used in the Holt-Laury menu for example, this procedure is equivalent to applying the weighting function W(p) to the probability of the higher payoff and to weight the utility of the lower payoff with the residual 1 − W(p).
“The effects of probability weighting may not matter much in investment tasks that use probabilities of 0.5, since the weights ofW(0.5) and 1 − W(0.5) may be close to the probabilities, as is approximately the case for the functions shown in Figure 4.2. Similarly, for a risk neutral person, the crossover point for the Holt-Laury menu in Table 4.3 would be in row 4, where the high payoff probabilities of 0.4 would not be affected. But most subjects are somewhat risk averse and cross over in lower rows. The key insight is to notice that the underweighting in Figure 4.2 is greatest for probabilities in the range from 0.5 to 0.7, which would mean that the high payoffs in rows 5 to 7 of the Holt-Laury choice menu in Table 4.1would be underweighted. The overweighting would have little effect on the attractiveness of the safe option, since the high and low payoffs of $2.00 and $1.60 are relatively close. But the reduced “attraction” of the highest $3.85 payoff would mean that people would be less prone to switch from the safe to the risky gamble in those rows, which increases the risk aversion. To summarize, observed risk aversion in this setting, and in other commonly used settings, may be due to a mixture of probability weighting and utility curvature considerations.
“This intuition from the previous paragraph is confirmed by a joint estimation of risk aversion and probability weighting parameters. Using a probabilistic choice framework, Comeig et al. (2013) find that the gender differences are largely in utilitycurvature for the expo-power function, not for the probability weighting parameter. For women, these curvature parameter estimates are α = 0.04, r = 0.39 and the probability weighting parameter estimate isw = 0.66 for women, all of which are significantly different from 0 at conventional levels. The estimates for men are α = 0.02,r = 0.18 and w = 0.67, which suggests that men are less risk averse in terms of the expo-power parameters. The estimates for the weighting parameter are close together and are close to other estimates that are typically near 0.7. The expo-power function was needed to accommodate the wide range of payoffs, since as noted above, the data included a high payoff (5×) scale treatment. The resulting predictions for proportions of safe choices track the observed higher risk aversion for females with downside risk, the tendency for both genders to take more upside risk, and the tendency for everyone to be more risk averse with high stakes.
“The take-away is that many (but not all) anomalous differences in propensities to make risky decisions may be cleared up by using functional forms that permit one to estimate the effects of payoff scale and risk profiles on observed behavior. What is surprising is not how well these probability weighting models tend to work well in some contexts, but rather, the fact that they are typically not even mentioned in the standard (and somewhat thick) textbooks used in most doctoral microeconomic theory classes. But with individual choice data, which is known to be riddled with anomalies and context effects, general theoretical solutions have to be viewed as tenuous.
“Econometric estimates of specialized models, however, are not convenient for the kinds of simple risk preference assessments that are desired for most laboratory and field applications. Moreover, to be useful, such estimates have to be done for individual subjects who make limited numbers of decisions, which limits the number of parameters that can be used. A simple procedure for obtaining individual estimates can be derived for the Prelec weighting function and the standard model of constant relative risk aversion. To simplify the calculations, utility is normalized so that…”
4th on same page, JQ’s;
Handbook of the Economics of Risk and Uncertainty
“John Quiggin, in Handbook of the Economics of Risk and Uncertainty, 2014
12.4.1 Prospect Theory
“A more durable contribution to the literature on probability weighting was theprospect theory of Kahneman and Tversky (1979). As well as providing experimental evidence that formed the basis of much subsequent research, Kahneman and Tversky presented a theoretical model, named prospect theory, in which they sought to encompass a range of empirically observed phenomena, notably including probability weighting and reference point effects. “
An autogyro/gyrocopter has an unpowered rotor (or rotary wing) in free autorotation to develop lift. Forward thrust is provided by other means. The autogyro’s rotor must have airflow across the rotor disc – the area swept by the rotor blades – to generate rotation and lift, and the air flows UPWARDS through the rotor disc.
A helicopter in power mode generates lift and vectored motion by forcing air flow DOWNWARDS through the rotor disc. A tail rotor, or second main rotor (in coaxial, tandem or parallel configuration turning in the opposite direction) compensates for yaw.
If the helicopter engine(s)/transmission/tail rotor fails during powered flight, and there’s sufficient altitude, then there’s a very limited window of opportunity (usually seconds) for the pilot to recognise the problem and actuate the rotor blades into autorotation mode (to avoid the rotor blades dissipating most of their rotational momentum).
Yes, I simply meant a gliding, un-powered gyro or copter in an updraft could maintain or even gain altitude in an updraft (if it could be controlled). Such a situation wouldn’t last for long unless it could circle like an eagle or glider in the updraft. Maintaining altitude requires enough lif force t to counter an acceleration og 1 g = 9.8 m/s/s towards the earth taking the mass of the aircraft into account (if I am correct). In that sense, the DWFTTW land yacht is like a gyro rotated through 90 degrees to the vertical (the blades that is) with the wind behind it as the analogue for the updraft. I think the analogy holds but I wouldn’t bet my life on it… in the gyro. I would certainly love to try the propeller land yacht. I had a conventional sail land yacht… when I was young.
I’d been aware of and experienced sailing across the wind, which generated boat speeds greater than the windspeed (broad reach or shy run as my father called it) but not sailing downwind. I am struggling with the idea that you will reach a downwind destination faster than the wind, even where you can achieve boat speed that exceeds wind speed, even knowing that it is related to that ability to go faster perpendicular to the wind direction.
There appears to be clear demonstrations of sailing downwind faster than the wind in practice but my brain doesn’t like it – but I suppose for lots of people the idea that a sailing boat can successfully reach a destination that is upwind is similarly a struggle.
I think my dad would have liked to master that kind of sailing. Probably liked to have a go with hydrofoil sailing boats too if they’d been around; getting his boats (built to his specifications wholly or in part by him) to go as fast as possible was a lifelong obsession. He did have a go – successfully – on a sailboard when in his 60’s, which I think were amongst the fastest sailing craft at the time.
It definitely happens. Very fast sailing craft can tack downwind to an exact downwind marker faster than the wind goes direct downwind to that marker. The Direct Downwind Faster than the Wind (DDWFTTW) land yacht also achieves this. These are verified empirical facts and yes it took a while for me to be convinced about the propeller land-yacht example.
All the explanations I have read about the propeller land-yacht example, including those from Veratasium himself and other physics explicators are not quite right. They all assume that propellers generate “thrust” by pushing air back and then going for the action / reaction model based on this, meaning mass of air thrown back. This actually is not correct for propellers. This is not the way propellers develop “thrust” or at least not the major way propellers develop a “thrust” or push.
You can confirm this contention of mine by going to sites like this:
“A spinning propeller sets up a pressure lower than free stream in front of the propeller and higher than free stream behind the propeller… Propellers are airfoils, shaped similarly to wings. But instead of producing lift in a vertical direction, propellers (in conventional aircraft) produce lift in forward direction that we call thrust.” – NASA.
If we think about the pressure model (the true model) we begin to understand how the vehicle works and why it can go faster than the wind. It is the pressure differential pushing the craft foward. If we can maintain a pressure differential above the wind speed over ground, we can go accelerate to a speed faster than the wind. The craft does this by using apparent wind on the air-foils of the propeller to develop life. The prop spins such that each foil of the prop develops an apparent wind faster than the real wind and coming in at angle onto the “blunt” edge of the propeller foil. It is this lift that appears to pull the craft forward. Of course, lift can’t pull. It’s actually the higher pressure nehind that pushes.
Sigh, typos and slightly wrong words conceptually in the last half of the last paragraph above.
Last half of last paragraph corrected.
If we can maintain a pressure differential at yacht speeds above the wind speed over ground, we can accelerate to a speed faster than the wind speed. The craft does this by using apparent wind on the air-foils of the spun-up propeller to develop extra lift. The prop spins such that each foil of the prop encounters an apparent wind faster than the real wind and coming in at an ideal angle onto the “blunt” edge of the propeller foil. It is the lift that from the air-foil that appears to pull the craft forward. Of course, lift can’t pull. It’s actually the higher relative pressure behind that pushes.
I’ve not seen any written explanation that gets this quite right. I am sure they exist, I just havn’t been able to find them. Hat tip to my brother for leading me to this understanding.
I am now attempting to make good on my offer to provide some material on ‘rationality’ in economics, in words.
It turned out to be a little more difficult than what I had anticipated when making the offer.
The primary difficulty is the term ‘homo economicus’. (Parenthetically I note in Law – case law – there is a similar ‘stereotype’ human, namely a ‘reasonable person’ – also in a representative role.)
Short of doing a full scale literature search and review, which would take months, I consulted Dr Google to start of with: https://en.wikipedia.org/wiki/Homo_economicus
A few observations on the content of this website:
1. “The term Homo economicus, or economic man, is the portrayal of humans as agents who are consistently rational and narrowly self-interested, and who pursue their subjectively-defined ends optimally.”
a. On the face of it does not apply to females! (smiley)
b. This notion of ‘economic man’ does indeed belong to an era where the head of the household (queens excepted) made the decisions and the social norm was the decision maker was a male; the website gives a few chronological dates.
c. As often discussed on this blogsite, neoliberalism is an anachronism; going forward to the past. The IPA’s mental model as revealed in their public announcements and statements rests on the notion of homo economicus.
2. “In game theory, Homo economicus is often modelled through the assumption of perfect rationality. It assumes that agents always act in a way that maximize utility as a consumer and profit as a producer, and are capable of arbitrarily complex deductions towards that end. They will always be capable of thinking through all possible outcomes and choosing that course of action which will result in the best possible result.”
a. This applies not only to game theory.
b. In intro micro texts the above assumptions are typically not made explicit because only very simple partial equilibrium models are introduced as in:
i. Consumer choice theory
ii. Theory of the firm
In partial equilibrium models system questions are not asked, eg: What happens when every member of a society behaves like this, will aggregate resources (physical, biosphere – natural environment) be sufficient? Implicitly, it is assumed that the system questions have already been solved with the outcome that ‘the system works’. (This is not assumed in general equilibrium or agent models).
Steve Keen’s book, Debunking Economics, contains a critique of this part of Economics.
3. “As a theory on human conduct, it contrasts to the concepts of behavioral economics, which examines cognitive biases and other irrationalities, and to bounded rationality, which assumes that practical elements such as cognitive and time limitations restrict the rationality of agents.”
a. I don’t have research experience in behavioural economics. My one undergraduate unit in psychology and sociology of decades ago isn’t a solid foundation to comment. However, after reading “The Psychology of Stupidity” by Jean-Francois Marmion (ed), I am confident of saying:
b. “cognitive biases” and other “irrationalities” are concepts from Psychology. Like with partial equilibrium models in micro-economics, these concepts may be useful in some or even many applied circumstances. However, I don’t find them helpful for dealing with economic questions on a society level where more than one individual or decision maker or agent interact.
c. IMO, the various biases (cognitive bias, confirmation bias, … ) presuppose a point of reference. What is unbiased?. Some articles in the book “The Psychology of Stupidity” use the most naïve form of homo economicus as point of reference (why not use contemporary concepts?)
d. Similarly, irrationalities presuppose a concept of rationality. Some articles use the economic man as a point of reference (economics does not claim to have answers for all aspects of human life). In other cases one may suspect that the researchers presume they know better. I prefer theoretical models where the modeller and the empirical researcher does not have a privileged position in their models of society, which influences if not determines empirical research.
e. It may well be that psychologists and behavioural economists have their own notion of ‘bounded rationality’. Later on I shall say a few words about ‘bounded rationality in the context of contemporary economic theory of the math econ variety.
4. There is one paper in the said book “Psychology of Stupidity”, which I find interesting: Algorithmic Intelligence Versus Rationality. This concept is due to Keith Stanovich, emeritus professor of psychology at the University of Toronto, cited and described in the chapter titled “Intentional Idiocy” by Yves-Alexandre Thalman, pp 103-113 in “The Psychology of Stupidity”.
i. Quote: Stanovich identifies what he calls ‘algorithmic intelligence’, which pertains to comprehension and to the logical combination of ideas. ….
ii. …Professor Stanovich identifies another level of intelligence, which he calls ‘rationality’. Rationality relates to the capacity to make decisions that help us achieve our objectives and to adopt beliefs that take reality into account. End Quote.
Relationship to contemporary econ theory of the math econ variety (EG’s interpretation).
Algorithmic intelligence is involved when economists write down a commodity space which each individual is assumed to know. That is, individuals are capable of distinguishing between a potato and a pumpkin and between copper grade A and copper grade B and so forth and they are cognisant of where (location) and when (time) these objects of choice (commodities) are available. They are able, intellectually, to observe whether the stuff they bought has been delivered as promised. They understand they can’t have anything they want for free. That is they can combine the idea of want with the idea of affordability, and so forth.
Bounded rationality. Not everybody knows the entire commodity space (I don’t know what is being traded in Wuhan today and at what prices. I don’t even know what is traded in the Eastern Suburbs of Sydney and at what prices. So, one interpretation of bounded rationality simply means that the commodity space faced by individual agents is not the same. It is a subspace – a segment only. My model of partially segmented economies with multinational producers involves this notion of bounded rationality even though I did not use this terminology.)
Prof Stanovich’s notion of rationality is akin to the economic notion of agents making decisions (take actions) which are consistent with their subjective preferences and subject to their resource constraints (‘budget constraint’). So the objective is to ‘maximise preferences’ subject to affordability. Under certain assumptions about preferences (a pre-ordering), these subjective preferences can be represented by a utility function. In an intertemporal framework, the notion of taking reality into account when forming beliefs, is represented in these abstract mathematical econ models by using a mathematical object, called a ‘filtration’ of the space that represents uncertainty (event tree in an applied context). Agents are assumed to be able to observe what has happened (‘realisation’) and compare it to what they had thought might happen in the future. Depending on the type of filtration, agents are able to learn at least where in the process they are.
Obviously, preferences do not have to be restricted to self-interest. It is a pity this math econ literature seems to be not widely known (a more serious case of bounded rationality?!)
The weakest form of assumptions on preferences I have come across translates into cases like the woman in Open All Hours, who can’t make up her mind, are excluded.
I did find a website, which details the economic theory advances since the notion of homo economicus was introduced. Unfortunately, this website is in German. There are translation programs available. I don’t think it would be fair if I were to post a translation of this site on JQ’s blog.
Thank you for this reply. I know that feeling when I say to someone, “I can summarize this (some complex concept I might know about) for you,” and then I actually try. It is never as easy as we first assume.
I am fine with translating with Google Translate. I use it to communicate with Russian computer game designers. I have also used it to translate Chinese papers about COVID-19. If one is methodical it is not too hard. I translate screen-fulls at a time and alt-tab to paste translations in a Word doc. Only need 3 windows open.
Even hard science requires founding axioms. This might surprise many. Albeit, the founding axioms are assumptions with empirical “truth warrants” for justification. This is just to say that there is enough empirical evidence to justify the axiom as likely to be truth correspondent enough (with a real system) and to not be provably wrong or patently absurd or illogical.
As an example of the above, Einstein in his 1905 paper “On the Electrodynamics of Moving Bodies” wrote:
“If at the point A of space there is a clock, an observer at A can determine the
time values of events in the immediate proximity of A by finding the positions
of the hands which are simultaneous with these events. If there is at the point B
of space another clock in all respects resembling the one at A, it is possible for
an observer at B to determine the time values of events in the immediate neigh-
bourhood of B. But it is not possible without further assumption to compare,
in respect of time, an event at A with an event at B. We have so far defined
only an “A time” and a “B time.” We have not defined a common “time” for
A and B, for the latter cannot be defined at all unless we establish by definition
that the “time” required by light to travel from A to B equals the “time” it
requires to travel from B to A.”
Einstein assumes “by definition that the “time” required by light to travel from A to B equals the “time” it
requires to travel from B to A.” In other words, he makes this assumption axiomatically and without empirical evidence. There is actually no way to prove that light travels at equal speeds in opposite directions. However, it seems a reasonable assumption to make  and no evidence can be found to disprove it. The assumption permits theoretical and mathematical progress and continued empirically validated predictions from the theory. These retro-validate, as it were, the use of a founding axiom for the theory.
So, in initial theory, there is nothing wrong with assuming certain characteristics of the “representative man”, perhaps especially when we want to get the “Brownian” average of his behavior. Sorry, that’s a poor metaphor based on Brownian motion. But there are or can be a lot of ensuing problems. The assumption (as an axiom) certainly permits theoretical and mathematical progress but does it permit successful predictions which are empirically and repeatedly validated? Is there too much “complex causation” acting as interference to test the theory?
The physical sciences are modest in a sense. They tightly control experimental and observational conditions and only (essentially) derive fundamental Laws from these tightly controlled experimental and/or observational systems.
There is a further problem which I feel, after my investigations, that economics, or perhaps just bowdlerized economics, passes over. This is the problem that economic theories, like all social sciences theories, enter into the consciousness of at least some of the agents under study and this can change the agents’ behaviors. But it doesn’t end there.
Agents, unlike photons for example, are programmable.  Being someone who has done a bit of programming, and even programmed, as a hobby, simple AI “agents” to play games like noughts ‘n crosses and chess, I see humans as (in one essence) programmable agents. All teachings, learnings, acculturations and enculturations do program us; albeit we often use heurtistic and fuzzy logic in our determinations and we also demonstrate autonomy as autonomous behaviors. “Autonomy” can be taken as another term for “endogenous actuation” without making any assumptions about “free will” or “voluntary choice”.
Economics, as extant socioeconomic practice including customs. legal laws, regulations and rules, contains many prescriptions which we acquire by teachings, learnings, acculturations and enculturations. Here, in economics, all the prescriptive axioms are not assumptions describing an alleged external, objective, universal, aspect of reality (which axiom could be a descriptive, simplifying axiom with some empirical truth warrant). As such, economics muddies the very waters it studies unless, in my view, it develops a method to take account of these iterative (as they are) interfering or reinforcing feed-backs between the formal prescriptive and the real.
Just my thoughts to date and summed up very briefly. I will follow up your information and links. Thanks again.
Note 1. It is a symmetry assumption about space and at least one of its properties. We certainly know of mundane examples where symmetry assumptions would be wrong. Imagine if I assume a boat of known top speed can travel up river and down river at the same speed relative to the river banks. What about river flow? What about winds? What about tides (if a tidal river)? If the universe is “inflating” does this affect the speed of light?
Note 2. A photon may one day become a bit in a photon or quantum computer (who knows? not me) but a photon itself is not conceivably programmable (as opposed to direct-able) so far as I know.