Discussion about this post

User's avatar
Matt's avatar

I agree with you. I had an email debate with Gary Klein and Daniel Ariely about this in 2009.

This is what I wrote then.

"I would like to use hyperbolic discounting is an instructive example. This is normally portrayed as irrational behaviour or a "bias" (i.e. a deviation from rationality). However in a highly unstable environment it is actually a rational response. For most of our history, human beings have lived in such unstable environments (and many still do). Within that context, it is rational. In a new context (say, the Western world between 1993 & 2007) it is "irrational". The problem is that the patterns of optimal behaviour that human beings develop collectively (what we might call "rationality") tend to lag changes in our environment. A "bias" is not fundamentally irrational, it is simply a piece of rational pattern recognition being deployed in the wrong context.

Classical economics reminds me of nothing so much as classical mechanics. They are approximations that work well in certain defined contexts (although I think that classical mechanics was more successful than classical economics). Classical mechanics might be useful but it is not helpful in all contexts - and attempts to save it required the deployment of "fudge factors" such as "aether". Classical mechanics has been superceded by quantum mechanics and relativity - which is not to say that it isn't still used when required. The use of "bias" strikes me as a very similar fudge factor to "aether".

I think that the empirical findings of Behavioural Economics will stand the test of time but I also believe that its theoretical underpinnings need to be rewritten in the light of Naturalistic Decision Making and other cognitive sciences. What I'd like is some "Grand Unified Theory" (maybe not so grand but certainly more unified) of human behaviour.

I'm kinda strayin' into evolutionary psychology* territory here. Is there a link between NDM, BE & evolutionary psychology? Should there be?"

Expand full comment
Michael Vakulenko's avatar

How is saying that "Evolution cannot produce perfect designs, only 'good enough' ones" even a critique? To me, as someone familiar with genetic algorithms—models inspired by natural selection—it seems precisely how evolution operates. Evolution is an iterative, never-ending process that doesn't aim for perfection or an optimal endpoint. Every "design" is either destined for extinction (with overwhelming probability) or evolves into a new, more adaptive form. Critiquing evolution for not producing perfect designs feels like critiquing a river for not being straight—it's simply not how the system works.

Expand full comment
10 more comments...

No posts