Moral arbitrage

.!.

I posted this in response to some discussion at Crooked Timber on the Iraq war, Gaza and so on.

Looking at the discussion, it seems as if nearly everyone is concerned about the (foreseeable) consequences of their actions, but there are a lot of claims that some consequences should be treated differently from others (intended vs unintended, direct vs intermediated by the predictable reactions of others, and so on).

To an economist, what this naturally suggests is the possibility of moral arbitrage.

Read More »

A bit more on the economics of happiness

I was discussing the economics of happiness with my son, and in particular the Easterlin paradox. Within a given country, people with higher incomes are more likely to report being happy. However, in international comparisons, the average reported level of happiness does not vary much with national income per person, at least for countries with income sufficient to meet basic needs. The same is true over time – average happiness levels don’t change much even as incomes rise.

This is often taken to mean that it’s relative rather than absolute income that determines happiness, so an increase in everyone’s income won’t make anyone happier. Hence, we shouldn’t worry so much about increasing income, but should focus more on factors likely to contribute to happiness. The point that struck me was that, given Easterlin’s data, the paradox is almost certain to apply whatever potential source of happiness we consider, in one form or another.

Read More »

The dormitive quality of rational choice

This Matt Yglesias post has already made it on to my colleague Andy McLennan’s door. It’s short enough to quote in full

I’m not sure I understand why Greg Mankiw thinks economists “don’t understand tipping.” When I was learning economics, I learned that people are utility-maximers and that whenever you see some behavior that doesn’t seem explicable in purely financial terms that must be because people are deriving utility from the foregone financial advantage. Thus, as any economist could tell you, people tip because of the utility they derive from the tipping in much the way that economists can explain all aspects of human life.

Have I ever mentioned that philosophers tend to think that economics is vacuous? Which isn’t to say that you shouldn’t listen to economists. These days, they tend to know a lot of math, and math is a very useful thing.

Matt omitted the irony alerts, but I tried to spell out the same point here.

Given any data on any observed set of problems involving the selection of one or more choices from a set of alternatives, the observed choices can be represented as the maximisation of an appropriately specified function.

Playing straight man to Matt, that doesn’t mean utility functions are useless – the functional representation lets you do lots of math that is much harder if you try to work directly with preferences. But any competent economist knows that utility isn’t an explanation of observed choices, it’s a way of representing them. The representation is simpler if choices satisfy some minimal consistency requirements, like transitivity (if you prefer A to B and B to C then you should prefer A to C).
Read More »

Rationality and utility

Over at Cosmic Variance, physicist Sean Carroll offers some admittedly uninformed speculation about utility theory and economics, saying

Anyone who actually knows something about economics is welcome to chime in to explain why all this is crazy (very possible), or perfectly well-known to all working economists (more likely), or good stuff that they will steal for their next paper (least likely). The freedom to speculate is what blogs are all about.

I didn’t notice anything crazy but there’s a fair bit that’s well-known. For example, Carroll observes that utility is generally not additive across commodities, and that some goods are likely to be more closely related than others. That’s textbook stuff, covered by the basic concepts of complementarity and substitutability.

This is a more interesting and significant point

But I’d like to argue something a bit different — not simply that people don’t behave rationally, but that “rational� and “irrational� aren’t necessarily useful terms in which to think about behavior. After all, any kind of deterministic* behavior — faced with equivalent circumstances, a certain person will always act the same way — can be modeled as the maximization of some function. But it might not be helpful to think of that function as utility, or as the act of maximizing it as the manifestation of rationality.

I can only agree. But economists and (even more, I think) political scientists in the “rational choice” tradition regularly get themselves tied up in all sorts of knots about this, switching between the trivial notion of maximising a function and substantive claims in which rationality is frequently equated with egoism. Joseph Butler demolished this kind of reasoning nearly 300 years ago, but it keeps on popping up.

* This qualification isn’t necessary, and Carroll notes later on that choices are often stochastic. The resulting probability distributions still maximise an appropriately defined function.

Conserva-bible

I can’t resist following Conservapedia, the Tlön version of Wikipedia, in which the liberal, anti-American bias of the Earth version is replaced with virtue and apple pie. But where did this bias come from, and how is it so deeply rooted in our culture? The answer, it turns out is the Bible, not of course the true version held in the vaults of Uqbar, but the liberal Earth Bible known by such as names as the King James and Revised Versions.

In the Uqbar version, as explained at Conservapedia, all sorts of politically correct liberalism is eliminated or glossed out of existence. Uqbar scholars have discovered that the soft-on-crime John 8:7 ‘”If any one of you is without sin, let him be the first to throw a stone” was inserted by time-travelling liberals some time around the 4th century. Naturally, Conservapedia says, Wikipedia sticks to the Earth version, though a check of the actual site suggests that the annoying liberal habit of looking at all the evidence is at work here as well.

Conservapedia has able assistance from other conservative sources. All that class warfare stuff about the rich not getting into heaven (Matthew 19:21-24) turns out to mean that if you want money, you should cut God (or his earthly representatives) a good share in advance. Other kinds of warfare are fine with the Prince of Peace, though. As for turning the other cheek ((Luke 6:27-31), it’s No More Christian Nice Guy.

In praise of libertarianism

I got a great response from libertarian readers to the Great Shave Appeal, and so the final instalment in my ‘In Praise of ..’ series is addressed to them.

Although they are often at loggerheads, libertarians and social democrats share plenty of ideas, derived in large measure from common sources. Both draw heavily on the 19th century liberalism of John Stuart Mill, who managed to write effectively in support of both classical free-market economics and, later in life, a rather abstract form of socialism.

It’s not surprising then, that I broadly agree with libertarians on the classic civil liberties issues – freedom of speech, freedom from arbitrary arrest and detention, opposition to government intervention in private decisions such as sexual activity and drug use and so on.

The attacks on civil liberties since the Iraq war have made many of these issues more vitally relevant and led me and others to stress our areas of agreement with libertarian defenders of freedom such as blogger Jim Henley. They have helped to distinguish genuine libertarians from otherwise orthodox authoritarians (typically US Republicans), who happen to take a relaxed view on sex and drugs.

Read More »

I refuse to use that word, but …

I’m using my blog to beg for help on a minor point.

The Wikipedia article on pscyhological egoism, which draws on the e Stanford Encyclopedia of Philosophy includes

Finally, psychological egoism has also been accused of using [[circular logic]]: “If a person willingly performs an act, that means he derives personal enjoyment from it; therefore, people only perform acts that give them personal enjoyment”. In particular, seemingly altruistic acts must be performed because people derive enjoyment from them, and are therefore, in reality, egoistic.. This statement is circular because its conclusion is identical to its hypothesis (it assumes that people only perform acts that give them personal enjoyment, and concludes that people only perform acts that give them personal enjoyment).

I’ve added the claim, based on memory that “This objection was made by William Hazlitt in the 19th century, and has been restated many times since then”, but Google only produces reference to a previous occasion on which I made the same claim. Can anyone point to a good citation of Hazlitt on this, or to any other versions of this argument from the 19th and 20th centuries?

Pessimism

This NYT piece by Adam Cohen starts with the observation that Americans are feeling pessimistic about the war in Iraq, Hurricane Katrina and so on, then jumps to a recent work on philosophical pessimism by Joshua Dienstag, whose basic argument is summarised in this sample chapter. As Cohen says, pessimism in this sense is not a gloomy disposition, but a worldview that “simply doubts the most basic liberal principle: that applying human reasoning to the world’s problems will have a positive effect.’ Cohen concludes “Part of Mr. Bush’s legacy may well be that he robbed America of its optimism “.

But if optimism holds that applying reasoned analysis will have a positive effect, the experience of the Bush Administration merely illustrates the point that the converse is also true.
Read More »

The apparent deceptiveness of the world

Googling around in connection with my review of Unspeak, I came across an old LanguageLog post on The apparent deceptiveness of the world, which cites the paradoxical statement

Appearances are not deceptive; it only seems as if they are.

and invites Brian Weatherson (who’s now one of the crew at Crooked Timber) to analyse it, saying

Clearly, if this is true, then it has to be false, and if false, it must be true. Yet it is not a standard liar-paradox sentence like as in classic liar sentences like This statement is false, or Everything I tell you is a lie, including this. It does not mention truth or falsity, or refer to itself. It is a metaphysical claim, as far as I can see. It speaks not about language or truth but about the nature of reality. It says (contrary to the old proverb) that reality does not present itself in a way that deceives our senses, and any perception we may have to the contrary is incorrect.

I think we can extract a coherent claim with the aid of Hamlet’s observation “For there is nothing either good or bad, but thinking makes it so”. I’d read the statement as saying something like “First appearances are not deceptive; it’s thinking about them that leads you astray”. While this is obviously false as a general statement, I think direct perceptions are usually closer to the mark than the results of the kinds of analysis (Freudianism, large parts of Marxism, a lot of public choice theory) that purports to strip away surface appearances and reveal the underlying truth.

BrisScience and BrisReligion

The next in the BrisScience lecture series is on tomorrow (Monday) night, at City Hall, 6pm for 6:30. Continuing to diversify the range of topics, the speaker is Margaret Wertheim, on the topic ” Space and Spirit: Why Science and Religion Together are Driving us Crazy”. As the extract over the page suggests, Wertheim thinks that we have a fundamental pyschological need for a reconcilation of science and religion.

I’m not so sure about this. One of the most striking features of the late 20th century was the collapse of active religious belief in most of the developed world, with the glaring exception of the United States. This didn’t result in any direct sense from scientific discoveries about the universe. And, surprisingly, it didn’t seem to produce any big changes in behavior (there have been changes in sexual mores, but these have been just as noticeable in the US as elsewhere) or any obvious rise in cosmic angst. You can find some statistical differences between believers and non-believers, and between those who regularly attend religious services and those who don’t, but they are a lot smaller than much of the discussion of this topic would suggest.

Unfortunately, I won’t be able to make it, as I’ll be presenting at the IAAE Conference in the Gold Coast so maybe some Brisbane-based reader would like to put in a brief report on proceedings.
Read More »