kw: book reviews, nonfiction, psychology, neurology, errors, consciousness
Oliver Sack's fifteenth, and last, book is The River of Consciousness. He died just two weeks after completing the design of the book, composed of his essays in various medical and popular publications. I first came across his books three years ago; this is the third of his that I've read and reviewed in that time. He may be best known to the public for The Man Who Mistook His Wife for a Hat, which I have yet to read…but it is on my short list.
As any good clinical "brain worker", he collected mistakes. Freud with his "slips" may be the one we know the best for elucidating the shortcuts our mind and brain use, from certain mistakes that we make. I find Dr. Sacks to be the best at explaining the usefulness of the categories of our errors to us.
Not all the chapters in the book are explicitly about "useful errors". The chapter "Speed", for example, attacks questions such as, "Just how fast can we think?" and "What is it like to think a hundred times faster, or slower?" We all have heard of phenomena such as having one's life flash by in a moment during severe emergencies, or of becoming so absorbed in minutiae that hours can pass with hardly a ripple on our thoughts. Sundry drugs can affect our time sense: I once began to take a prescription drug for systemic fungus, and on the fourth day managed to work up enough ambition to phone my doctor to say, "I just realized that the wallpaper texture in my office is so interesting that I've been looking at it for four hours." He recommended that I stop taking it, and dropping by for a different prescription!
The chapter "The Creative Self" dwells much on the apparently unconscious problem-solving abilities we have (you can call it "right brain" but it is more involved than that). For much of my career as a systems programmer, I relied on it: Near the end of a work day I would often set up a structure in my mind, of the current algorithmic problem I faced, and sort of give it a mental push. I could usually expect to awaken at 3:00 AM with a flowchart "sitting there," ready for me to spool out into working code. From the dancing flames that Kekulé was watching when the structure of Benzene suddenly sprang to mind, to the introduction to Das Rheingold that Wagner had been struggling with, and which erupted into his consciousness while he took a hike to take a break, creative "flashes", while not too common, are well enough known to us all. They do not really denote lightning inspiration, but rather, they culminate a long and laborious fitting and re-fitting of ideas that goes on in the background; it seems almost independent of our conscious problem-solving, and usually quite linear, processes.
I was also quite taken with the chapter "Scotoma: Forgetting and Neglect in Science." The author digs into the lore of "ideas born before their time." It is usually the case that such ideas enter an arena that is already full of competing theories, and in particular, they usually incite the ire of numerous and powerful figures whose work is threatened thereby. My father used to say, "Really good ideas often have to take Moses's way: 40 years in the wilderness for a generation to die off." Sometimes it is more like a century or two! The most extreme example is that Archimedes seems to have invented calculus nearly 19 centuries before Liebnitz and Newton (re)formulated it.
Rather than comment on every chapter, I'll leave it to the reader to enjoy the book.
Showing posts with label errors. Show all posts
Showing posts with label errors. Show all posts
Saturday, April 14, 2018
Sunday, March 20, 2016
Are you an Econ? Don't bet on it!
kw: book reviews, nonfiction, psychology, economics, errors, behavior, behavioral economics, memoirs
John Maynard Keynes developed early theories of economics and markets, and made a distinction that later economists neglected and then forgot. He stated that the actions people take are frequently prompted by "animal spirits", which he defined as "a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities." [Keynes, 1936: The General Theory of Employment, Interest, and Money] In other words, people do not always, or even usually, thoroughly calculate or deliberate upon their decisions.
Fast-forward forty years, from 1936 to 1976. Milton Friedman has become the twelfth Nobel laureate in Economic Sciences. Economic theories have been developing, even proliferating. Men (no woman won until 2009) labored for years to wring a new formula out of the growing mass of theory, a few became Nobelists, and the edifice thus built was indeed founded on the analysis of "quantitative benefits…" and so forth. Social scientists other than economists were beginning to protest that the "rational" decisions that were required for economic theory to work could not be realistically made by genuine human beings. Policies were arising that assumed everyone was capable of making near-instantaneous decisions using the very calculations that Nobel Prize-winning economists had labored for years to discover.
Friedman poured oil upon the roiled waters by invoking the "as if" argument, using an expert billiards player as an example. To summarize, an expert, or even pretty good cueman, does not calculate the outcome of a series of Newtonian physics collisions, but plays as if such calculations had been made. But others, who for the time being mostly kept their thoughts to themselves while they sought tenure (!), realized that this implied all of us have Olympic-level skills when we make economic decisions. Don't I wish!
One of these others was Richard H. Thaler, who began to use the term "Econs" to describe the fictitious super-rational beings (who could out-Spock Mr. Spock) upon which economic theory depended. He distinguished Econs from Humans, a term referring to genuine human beings, who are indeed not Vulcans, but have emotions, proclivities, life histories, and only in the most extreme cases act with unvarnished Reason. Econs never err. Humans seldom fail to err. Extracting useful theories from the reliable errors of Humans has been a major element of Dr. Thaler's work, as described in his memoir Misbehaving: The Making of Behavioral Economics.
Dr. Thaler might be a somewhat unusual economist, because he has befriended and worked with a number of psychologists, including Daniel Kahneman, whose book Thinking, Fast and Slow I reviewed a few months ago. Perhaps most economists fear too much exposure to psychology, because Humans are so complex. Yet it is that very complexity that must be studied, for policy that does not take it into account cannot succeed.
The main "policy" way to get people to do something is to tell them. If the matter is important, perhaps sanctions such as fines will be enacted. A simple example might be (Ladies, avert your eyes) putting a sign in the Men's Room, above the urinals: "Please Aim Accurately. Excess Cleaning is Costly". Such a sign is likely to result in even greater need for cleanup. What to do? Economics is the study of incentives as one aspect of motivation. What motivates Human males? Exhortations typically just rile them up. Of course, if there were no Humans, only Econs, no sign would be needed. Econs never miss. Humans seldom miss if they have an enticing target. Some years ago in Holland something new was tried: to etch the image of a fly just above the drain of the urinal. "Excess Cleaning" needs were reduced by 80%. Don't be surprised if you see a "fly" in a public urinal.
The title Misbehaving refers to anomalies that Dr. Thaler has been collecting for decades, anomalies that could not exist or persist if we were all Econs. The fly-target is just the simplest example. Others include violations of the "Efficient Market Hypothesis" (EMH). The most glaring is a case in which 3Com acquired Palm, then years later sought to divest it by a partial sale of stock, to be followed by successive sales until the whole was sold off. Early sales of Palm shares indicated that, if EMH were true, investors considered the residual value of 3Com to be negative, because the value of all Palm stock at that price would exceed the value of the combined company! This is a small example of a bubble. The existence of bubbles, such as the U.S. housing bubble that burst in 2008, is a huge anomaly contrary to EMH. Bubbles imply that things are wrongly priced, and so does all the talk on morning "business segment" shows about whether a "correction" is imminent. Econs never suffer bubbles or corrections. For them, the price is always right. Always. For Econs, the price they are willing to pay or receive for an equity exactly mirrors all the expected future value of the company and its dividends and even closure costs when it comes to an end. Econs are the ultimate Seers!!
Maybe at work you have access to a 401(k) retirement savings plan. Do you contribute? Does your company pay a matching contribution of the first few percent? For years, taking advantage of a 401(k) required filling out some paperwork, selecting a level of participation, and perhaps selecting one or more funds (including company stock and a few mutual funds) to put your money in, for the next 20-40 years. Making changes was not simple. Participation was low.
I guess I am more of an Econ than usual. I jumped at the chance, starting with 6% (which we could barely afford to sock away, but the company matched the first 6%, so it was like getting free money). Each time I got a raise, I added a percent or two, until I maxed it out. But I knew one guy who put in his 6% each year, but took it back out the following year and spent it. He got his free money, but was only accumulating half as much as someone who saved 6% and left it there with its match. I bet he wasn't nearly as well prepared to retire at 66 as I was. Even more puzzling, in those years, even with 3% or even 6% company matching, more than half of my co-workers never started their 401(k).
A dozen or so years ago, Dr. Thaler and others began convincing companies to switch from this opt-in method to an opt-out one. Employees were informed they would be automatically enrolled in a 401(k), with 3% of their earnings and 3% of company matching funds going into some default investment, usually a money market fund or company stock or a mix of both. If they really didn't want it, they had to sign a certain form and send it to the payroll office. Participation rates increased greatly. Then they devised a follow-on program called Save More Tomorrow: Each time an employee received a raise, half of it (or a different proportion that could be chosen) would be added to their participation rate, maybe raising an initial 3% to 4% or 5%, then to 6% after the next raise, and so forth, up to a ceiling such as the maximum allowed amount. Some companies, not wanting to write extra software to couple the payroll system with the retirement system, opted instead to simply add half a percent yearly to each participating employee's savings rate, unless, again, they sent in a form with differing instructions.
If you have access to a plan such as this, and it has resulted in your saving more toward retirement than you used to, you have Dr. Thaler and other "economics renegades" to thank. Reading such an entertaining, informative book, I was quite encouraged that, finally, some economists are looking at us as genuine Humans, who do things because we like to rather than because of some lengthy, Nobel-worthy calculation; who make decisions when we are happy or sad or mad that are often different from what we'd decide in a calmer mood; who wear green today and blue tomorrow and can't decide what color shirt to wear after that, so we ask our spouse, who likes mauve but we hate it so we grab an apricot-and-chartreuse print and wear that. Don't be surprised if the decision which house or car to buy is backed up by no more thought than that print shirt! We are Humans!!
John Maynard Keynes developed early theories of economics and markets, and made a distinction that later economists neglected and then forgot. He stated that the actions people take are frequently prompted by "animal spirits", which he defined as "a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities." [Keynes, 1936: The General Theory of Employment, Interest, and Money] In other words, people do not always, or even usually, thoroughly calculate or deliberate upon their decisions.
Fast-forward forty years, from 1936 to 1976. Milton Friedman has become the twelfth Nobel laureate in Economic Sciences. Economic theories have been developing, even proliferating. Men (no woman won until 2009) labored for years to wring a new formula out of the growing mass of theory, a few became Nobelists, and the edifice thus built was indeed founded on the analysis of "quantitative benefits…" and so forth. Social scientists other than economists were beginning to protest that the "rational" decisions that were required for economic theory to work could not be realistically made by genuine human beings. Policies were arising that assumed everyone was capable of making near-instantaneous decisions using the very calculations that Nobel Prize-winning economists had labored for years to discover.
Friedman poured oil upon the roiled waters by invoking the "as if" argument, using an expert billiards player as an example. To summarize, an expert, or even pretty good cueman, does not calculate the outcome of a series of Newtonian physics collisions, but plays as if such calculations had been made. But others, who for the time being mostly kept their thoughts to themselves while they sought tenure (!), realized that this implied all of us have Olympic-level skills when we make economic decisions. Don't I wish!
One of these others was Richard H. Thaler, who began to use the term "Econs" to describe the fictitious super-rational beings (who could out-Spock Mr. Spock) upon which economic theory depended. He distinguished Econs from Humans, a term referring to genuine human beings, who are indeed not Vulcans, but have emotions, proclivities, life histories, and only in the most extreme cases act with unvarnished Reason. Econs never err. Humans seldom fail to err. Extracting useful theories from the reliable errors of Humans has been a major element of Dr. Thaler's work, as described in his memoir Misbehaving: The Making of Behavioral Economics.
Dr. Thaler might be a somewhat unusual economist, because he has befriended and worked with a number of psychologists, including Daniel Kahneman, whose book Thinking, Fast and Slow I reviewed a few months ago. Perhaps most economists fear too much exposure to psychology, because Humans are so complex. Yet it is that very complexity that must be studied, for policy that does not take it into account cannot succeed.
The main "policy" way to get people to do something is to tell them. If the matter is important, perhaps sanctions such as fines will be enacted. A simple example might be (Ladies, avert your eyes) putting a sign in the Men's Room, above the urinals: "Please Aim Accurately. Excess Cleaning is Costly". Such a sign is likely to result in even greater need for cleanup. What to do? Economics is the study of incentives as one aspect of motivation. What motivates Human males? Exhortations typically just rile them up. Of course, if there were no Humans, only Econs, no sign would be needed. Econs never miss. Humans seldom miss if they have an enticing target. Some years ago in Holland something new was tried: to etch the image of a fly just above the drain of the urinal. "Excess Cleaning" needs were reduced by 80%. Don't be surprised if you see a "fly" in a public urinal.
The title Misbehaving refers to anomalies that Dr. Thaler has been collecting for decades, anomalies that could not exist or persist if we were all Econs. The fly-target is just the simplest example. Others include violations of the "Efficient Market Hypothesis" (EMH). The most glaring is a case in which 3Com acquired Palm, then years later sought to divest it by a partial sale of stock, to be followed by successive sales until the whole was sold off. Early sales of Palm shares indicated that, if EMH were true, investors considered the residual value of 3Com to be negative, because the value of all Palm stock at that price would exceed the value of the combined company! This is a small example of a bubble. The existence of bubbles, such as the U.S. housing bubble that burst in 2008, is a huge anomaly contrary to EMH. Bubbles imply that things are wrongly priced, and so does all the talk on morning "business segment" shows about whether a "correction" is imminent. Econs never suffer bubbles or corrections. For them, the price is always right. Always. For Econs, the price they are willing to pay or receive for an equity exactly mirrors all the expected future value of the company and its dividends and even closure costs when it comes to an end. Econs are the ultimate Seers!!
Maybe at work you have access to a 401(k) retirement savings plan. Do you contribute? Does your company pay a matching contribution of the first few percent? For years, taking advantage of a 401(k) required filling out some paperwork, selecting a level of participation, and perhaps selecting one or more funds (including company stock and a few mutual funds) to put your money in, for the next 20-40 years. Making changes was not simple. Participation was low.
I guess I am more of an Econ than usual. I jumped at the chance, starting with 6% (which we could barely afford to sock away, but the company matched the first 6%, so it was like getting free money). Each time I got a raise, I added a percent or two, until I maxed it out. But I knew one guy who put in his 6% each year, but took it back out the following year and spent it. He got his free money, but was only accumulating half as much as someone who saved 6% and left it there with its match. I bet he wasn't nearly as well prepared to retire at 66 as I was. Even more puzzling, in those years, even with 3% or even 6% company matching, more than half of my co-workers never started their 401(k).
A dozen or so years ago, Dr. Thaler and others began convincing companies to switch from this opt-in method to an opt-out one. Employees were informed they would be automatically enrolled in a 401(k), with 3% of their earnings and 3% of company matching funds going into some default investment, usually a money market fund or company stock or a mix of both. If they really didn't want it, they had to sign a certain form and send it to the payroll office. Participation rates increased greatly. Then they devised a follow-on program called Save More Tomorrow: Each time an employee received a raise, half of it (or a different proportion that could be chosen) would be added to their participation rate, maybe raising an initial 3% to 4% or 5%, then to 6% after the next raise, and so forth, up to a ceiling such as the maximum allowed amount. Some companies, not wanting to write extra software to couple the payroll system with the retirement system, opted instead to simply add half a percent yearly to each participating employee's savings rate, unless, again, they sent in a form with differing instructions.
If you have access to a plan such as this, and it has resulted in your saving more toward retirement than you used to, you have Dr. Thaler and other "economics renegades" to thank. Reading such an entertaining, informative book, I was quite encouraged that, finally, some economists are looking at us as genuine Humans, who do things because we like to rather than because of some lengthy, Nobel-worthy calculation; who make decisions when we are happy or sad or mad that are often different from what we'd decide in a calmer mood; who wear green today and blue tomorrow and can't decide what color shirt to wear after that, so we ask our spouse, who likes mauve but we hate it so we grab an apricot-and-chartreuse print and wear that. Don't be surprised if the decision which house or car to buy is backed up by no more thought than that print shirt! We are Humans!!
Thursday, November 26, 2015
Mental structures that lead us astray
kw: book reviews, nonfiction, psychology, economics, errors, systems 1 and 2
On a recent episode of Star Talk, the latest offering by Neil deGrasse Tyson on the National Geographic Channel, he discussed his interview with Penn Jillette of Penn and Teller. At one point Penn presented this scenario:
So we have two ways of thinking, fast and slow. The fast, reactive system is tuned to keeping us alive. The slow, contemplative system is tuned to revising our model of the world and to informing the faster system how to work more accurately, in a way that keeps us up-to-date more efficiently than waiting for evolution to re-tune our reactions. Daniel Kahneman calls these System 1 and System 2 in his new book, Thinking, Fast and Slow. Though Dr. Kahneman is a psychologist, his Nobel Prize is in Economics.
This is a good spot to emphasize that economics is about how people make choices, not just about how we use money. At several points in the book, the author mentions how psychology and economics, as disciplines, can each inform the other, though historically they are "stovepiped", with too little cross-communication.
The handful of folks who actually "follow" this blog may have wondered where I've been for more than two weeks. I have been reading this book with more than usual care. It is a big book, with the main text totaling 418 pages, but two large appendices (reprints of the seminal articles he and Adam Tversky wrote) and extensive end notes stretch that to 481. A book this big will naturally take me a while to finish. A book this good takes even longer! It has more fine ideas per pound than any other I've read in the past few years. The book is structured around three big ideas, and a host of subsidiary ideas are thus engendered. I really have space only to summarize the Big Three.
Idea 1: System 1 and System 2. These are our Reactive System and our Contemplative (or Calculative) System. System 1 in action: during our courtship, my future bride and I were walking in a park and strolled over to sit on some monkey bars. Such seating is none too secure, and I said, "Don't push me." She did push me, before I finished the sentence, and I grabbed a couple of handholds during the word "me". Her S1 was operating to focus my attention, and my S1 instantly kept me from falling. This was followed by some S2 activity: She grinned to emphasize her playful mood, and I took that in and boosted my "how lovable she is" score a notch. Human courtship, operating as it has for millennia.
I had a conversation a few years ago with a professor of philosophy. He talked a bit about his work on "formal errors of logic", such as broken syllogisms (look it up; it'll save time). I said at one point that I was quite interested in errors of informal logic. He snapped, "That isn't real philosophy," rather pettishly, I thought. His expertise was threatened by the chance the conversation would turn to an unfamiliar area, and his S1 snapped to attention to maintain dominance over me. I retained my integrity by walking off to find a more congenial conversationalist. My S2 intervened just quickly enough to prevent my S1 from answering rashly.
I was fascinated by Dr. Kahneman's reports of ways our body and mind work together. In one experiment, students were asked to work a page of simple arithmetic problems, all the while holding a pencil in their teeth so it stuck out both sides of the mouth. Another group did the same problems, but held the pencil by its eraser with their lips, so it pointed out the mouth. The first group, forced by the pencil to smile, did the problem sheet much faster and more accurately than the other group, forced by the pencil to frown. This gives credence to the adage, "Fake it 'til you make it." We smile, not only to reassure others we are with of our good intentions, but to reassure ourselves that all is, or soon will be, well. This is just one example of many.
Idea 2: Econs and Humans. Much of the theory of Economics is based on the notion of a Rational Actor. People are expected to make choices rationally, unaffected by emotional considerations. The work of Dr. Kahneman and others demonstrates that this is probably the unlikeliest foundation upon which to found a theory. Our grandmothers knew we act without thinking, and we think—with some modicum of rationality—only when forced, even backed into a corner. Most of us pass most of the day without having one rational thought pass through our head. It is how you get to work, or back home, "on autopilot", particularly when you intended to run an errand on the way home, but arrived at your door wondering what it was you forgot.
Behavioral economist Richard Thaler calls the mythical Rational Agent an Econ, in contrast to the real agent that we all are, a Human. Econs do automatically what Humans typically cannot. I considered this analogy, which I make to distinguish faith from religion: A Religion is a checklist that you can hang on your wall. A robot could perform it all perfectly; you cannot. A Jewish friend told me of his study, in his youth, of the 611 laws in Leviticus, and how he sorted them into, "No problem", "Oh, maybe this is a bit sketchy", and "Who in his right mind would think this is possible?!?" In the wholly secular world, we are often told to "Count to ten first," but we find we've done something we can't undo before getting from one to two. A certain policeman is in the news these days, for shooting a youngster 16 times in 15 seconds, while six or seven of his colleagues were content to watch the young fellow from a step or two away and persuade him to put his little knife down and have a nice chat. Guess who belongs in quite a different line of work? And guess whose emotions take over some 10 to 100 times as quickly as more ordinary folk?
It seems every time someone designs an experiment to ferret out our rational and emotional responses to a situation, the rational mind is pretty hard to find. Later in the book, the author tells of ways to set up a situation so that we are more likely to give ourselves time for rationality, but he acknowledges that they are far from perfect. And he's been studying these things for 30+ years! What hope have we of any bit of rational behavior? Well, some hope, anyway, for we are Human after all, not Econ, and it is in our nature to hope, to try again, and sometimes to succeed a little.
Idea 3: Two Selves. Our memory, called here our Remembering Self, draws different conclusions from our experiences than our Experiencing Self does. The experiment here could not be more clear. Water colder than about 60°F hurts a little, and below 50°F it can hurt a lot, and quickly. A basin of water held at 57°F was provided, and students (nearly all experiments are done on college students! They come cheap) were asked to hold their hand in the water for 60 seconds. Then they reported how painful it was on the familiar ten point scale. After time to warm up, they were asked to repeat the experiment, but to hold their hand in the water for 90 seconds. After 60 seconds, water that was a few degrees warmer was let into the basin. Rather than report on a 1-to-10 scale, they were asked which experience was more painful. Nearly all reported that the first, shorter experience was more painful, even though they had endured a longer period of "torture" in the second experiment (It takes a few seconds for the warmer water to "take over"). The Experiencing Self may be queried during an experience and give you an accurate read on what things feel like "Right Now", but after the fact, the Remembering Self primarily remembers the last part of the experience more than all the rest. It's why we are advised to "go out with a bang"…as long as it is a favorable "bang"!
I suspect if the experiment were repeated in reverse, there would be a different outcome. I'd try this: Session 1, 60 seconds at 55°F. Session 2, 45 seconds at 60°F followed by 15 seconds as 52°F water is added. Maybe the exact temperatures would have to be tuned a little, but I am sure the Remembering Self would report the second session as more painful, even though the sum-total-torture was less. By the way, some experiments done for the Mythbusters TV program were done using a basin in which ice was floating, to hold the temperature at 32°F, and the duration was "as long as you can hold it", with a maximum of three minutes (180 sec.). Some participants held out the full three minutes, and lifted out their hand with ice sticking to the skin. So you can see that temperatures in the 50-60°F range will do no damage.
We think we are better at planning than we really are. All three of these things come together when we commit the Planning Fallacy. Chapter 23 of the book is entirely devoted to it. It is most evident in corporations that are having trouble. A new CEO will call together a team to "plan", and perhaps the plan will even be carried out to some extent. Do profits rise? Wonderful. The CEO gets a bonus. Does business remain "flat"? What a pity, the employees are defective and didn't carry out the plan as intended. Does business go down? Oh, my, "external factors" such as shifting currency ratios or a new and unexpected competitor must be to blame. Does the company tank? The CEO's "golden parachute" is activated, (s)he is booted out with a $10 million handshake, and a new CEO is brought in to repeat the process. As Yogi Berra said, "Predicting is hard, especially about the future." And Donald Rumsfeld warned us of the "Unknown unknowns", for which he was reviled, and then forgotten. Do you know anybody anywhere who strives to ferret out what "unknown unknowns" might become a factor, so as to deal with them?
One clear message of the book is that System 2 is lazy, pathologically lazy. It (we) typically accepts whatever "explanation" or "solution" is offered up in the instant that System 1 takes to perform its heuristic evaluation. Thinking is work, and we'd rather do almost anything else. And we typically do. My, it is a wonder that anything gets done!
On a recent episode of Star Talk, the latest offering by Neil deGrasse Tyson on the National Geographic Channel, he discussed his interview with Penn Jillette of Penn and Teller. At one point Penn presented this scenario:
Suppose you're a 3-foot hominid such as Lucy, and you hear a rustling in the grass. If you think about it, there are two causes: the wind, or an approaching predator. If you assume it is a predator and run, but it really was the wind, you have lost little but some energy and sweat. But if you assume it is the wind and it is a predator, you're lunch. So it is safer to assume it is a predator, because even if you are wrong, you are alive.I would add, if you take the time to think about it and weigh the "wind or predator" question, you are probably lunch also. That is why our defensive mechanisms work so fast, moving us out of harm's way before we have thought about it.
So we have two ways of thinking, fast and slow. The fast, reactive system is tuned to keeping us alive. The slow, contemplative system is tuned to revising our model of the world and to informing the faster system how to work more accurately, in a way that keeps us up-to-date more efficiently than waiting for evolution to re-tune our reactions. Daniel Kahneman calls these System 1 and System 2 in his new book, Thinking, Fast and Slow. Though Dr. Kahneman is a psychologist, his Nobel Prize is in Economics.
This is a good spot to emphasize that economics is about how people make choices, not just about how we use money. At several points in the book, the author mentions how psychology and economics, as disciplines, can each inform the other, though historically they are "stovepiped", with too little cross-communication.
The handful of folks who actually "follow" this blog may have wondered where I've been for more than two weeks. I have been reading this book with more than usual care. It is a big book, with the main text totaling 418 pages, but two large appendices (reprints of the seminal articles he and Adam Tversky wrote) and extensive end notes stretch that to 481. A book this big will naturally take me a while to finish. A book this good takes even longer! It has more fine ideas per pound than any other I've read in the past few years. The book is structured around three big ideas, and a host of subsidiary ideas are thus engendered. I really have space only to summarize the Big Three.
Idea 1: System 1 and System 2. These are our Reactive System and our Contemplative (or Calculative) System. System 1 in action: during our courtship, my future bride and I were walking in a park and strolled over to sit on some monkey bars. Such seating is none too secure, and I said, "Don't push me." She did push me, before I finished the sentence, and I grabbed a couple of handholds during the word "me". Her S1 was operating to focus my attention, and my S1 instantly kept me from falling. This was followed by some S2 activity: She grinned to emphasize her playful mood, and I took that in and boosted my "how lovable she is" score a notch. Human courtship, operating as it has for millennia.
- Our S1 does the things no computer does well: recognize who or what is around us, evaluate each on a hazard/help axis, and frequently prompt us to action, all within one or two tenths of a second.
- Our S2 struggles to do things a computer does well: put together the puzzle of our existence and map the world around us, carry out calculations (Quick! What is 27x17?), and feed new insights back to S1. If you could do that "simple" multiplication (partial sums: 340 and 119; add to 459) in less than five seconds, your "horseback arithmetic" skills are at expert level.
I had a conversation a few years ago with a professor of philosophy. He talked a bit about his work on "formal errors of logic", such as broken syllogisms (look it up; it'll save time). I said at one point that I was quite interested in errors of informal logic. He snapped, "That isn't real philosophy," rather pettishly, I thought. His expertise was threatened by the chance the conversation would turn to an unfamiliar area, and his S1 snapped to attention to maintain dominance over me. I retained my integrity by walking off to find a more congenial conversationalist. My S2 intervened just quickly enough to prevent my S1 from answering rashly.
I was fascinated by Dr. Kahneman's reports of ways our body and mind work together. In one experiment, students were asked to work a page of simple arithmetic problems, all the while holding a pencil in their teeth so it stuck out both sides of the mouth. Another group did the same problems, but held the pencil by its eraser with their lips, so it pointed out the mouth. The first group, forced by the pencil to smile, did the problem sheet much faster and more accurately than the other group, forced by the pencil to frown. This gives credence to the adage, "Fake it 'til you make it." We smile, not only to reassure others we are with of our good intentions, but to reassure ourselves that all is, or soon will be, well. This is just one example of many.
Idea 2: Econs and Humans. Much of the theory of Economics is based on the notion of a Rational Actor. People are expected to make choices rationally, unaffected by emotional considerations. The work of Dr. Kahneman and others demonstrates that this is probably the unlikeliest foundation upon which to found a theory. Our grandmothers knew we act without thinking, and we think—with some modicum of rationality—only when forced, even backed into a corner. Most of us pass most of the day without having one rational thought pass through our head. It is how you get to work, or back home, "on autopilot", particularly when you intended to run an errand on the way home, but arrived at your door wondering what it was you forgot.
Behavioral economist Richard Thaler calls the mythical Rational Agent an Econ, in contrast to the real agent that we all are, a Human. Econs do automatically what Humans typically cannot. I considered this analogy, which I make to distinguish faith from religion: A Religion is a checklist that you can hang on your wall. A robot could perform it all perfectly; you cannot. A Jewish friend told me of his study, in his youth, of the 611 laws in Leviticus, and how he sorted them into, "No problem", "Oh, maybe this is a bit sketchy", and "Who in his right mind would think this is possible?!?" In the wholly secular world, we are often told to "Count to ten first," but we find we've done something we can't undo before getting from one to two. A certain policeman is in the news these days, for shooting a youngster 16 times in 15 seconds, while six or seven of his colleagues were content to watch the young fellow from a step or two away and persuade him to put his little knife down and have a nice chat. Guess who belongs in quite a different line of work? And guess whose emotions take over some 10 to 100 times as quickly as more ordinary folk?
It seems every time someone designs an experiment to ferret out our rational and emotional responses to a situation, the rational mind is pretty hard to find. Later in the book, the author tells of ways to set up a situation so that we are more likely to give ourselves time for rationality, but he acknowledges that they are far from perfect. And he's been studying these things for 30+ years! What hope have we of any bit of rational behavior? Well, some hope, anyway, for we are Human after all, not Econ, and it is in our nature to hope, to try again, and sometimes to succeed a little.
Idea 3: Two Selves. Our memory, called here our Remembering Self, draws different conclusions from our experiences than our Experiencing Self does. The experiment here could not be more clear. Water colder than about 60°F hurts a little, and below 50°F it can hurt a lot, and quickly. A basin of water held at 57°F was provided, and students (nearly all experiments are done on college students! They come cheap) were asked to hold their hand in the water for 60 seconds. Then they reported how painful it was on the familiar ten point scale. After time to warm up, they were asked to repeat the experiment, but to hold their hand in the water for 90 seconds. After 60 seconds, water that was a few degrees warmer was let into the basin. Rather than report on a 1-to-10 scale, they were asked which experience was more painful. Nearly all reported that the first, shorter experience was more painful, even though they had endured a longer period of "torture" in the second experiment (It takes a few seconds for the warmer water to "take over"). The Experiencing Self may be queried during an experience and give you an accurate read on what things feel like "Right Now", but after the fact, the Remembering Self primarily remembers the last part of the experience more than all the rest. It's why we are advised to "go out with a bang"…as long as it is a favorable "bang"!
I suspect if the experiment were repeated in reverse, there would be a different outcome. I'd try this: Session 1, 60 seconds at 55°F. Session 2, 45 seconds at 60°F followed by 15 seconds as 52°F water is added. Maybe the exact temperatures would have to be tuned a little, but I am sure the Remembering Self would report the second session as more painful, even though the sum-total-torture was less. By the way, some experiments done for the Mythbusters TV program were done using a basin in which ice was floating, to hold the temperature at 32°F, and the duration was "as long as you can hold it", with a maximum of three minutes (180 sec.). Some participants held out the full three minutes, and lifted out their hand with ice sticking to the skin. So you can see that temperatures in the 50-60°F range will do no damage.
We think we are better at planning than we really are. All three of these things come together when we commit the Planning Fallacy. Chapter 23 of the book is entirely devoted to it. It is most evident in corporations that are having trouble. A new CEO will call together a team to "plan", and perhaps the plan will even be carried out to some extent. Do profits rise? Wonderful. The CEO gets a bonus. Does business remain "flat"? What a pity, the employees are defective and didn't carry out the plan as intended. Does business go down? Oh, my, "external factors" such as shifting currency ratios or a new and unexpected competitor must be to blame. Does the company tank? The CEO's "golden parachute" is activated, (s)he is booted out with a $10 million handshake, and a new CEO is brought in to repeat the process. As Yogi Berra said, "Predicting is hard, especially about the future." And Donald Rumsfeld warned us of the "Unknown unknowns", for which he was reviled, and then forgotten. Do you know anybody anywhere who strives to ferret out what "unknown unknowns" might become a factor, so as to deal with them?
One clear message of the book is that System 2 is lazy, pathologically lazy. It (we) typically accepts whatever "explanation" or "solution" is offered up in the instant that System 1 takes to perform its heuristic evaluation. Thinking is work, and we'd rather do almost anything else. And we typically do. My, it is a wonder that anything gets done!
Friday, January 17, 2014
Science Slip-ups
kw: book reviews, nonfiction, science, scientists, errors
I couldn't pass up the title: Brilliant Blunders: From Darwin to Einstein, Colossal Mistakes by Great Scientists That Changed Our Understanding of Life and the Universe, by Mario Livio. I was hoping it would be something better than one-upmanship ("See how much more we know now; aren't we good?"), and I was happily right. I've read an article or two by Dr. Livio—anyone has who has read publications by the STSCI—but none of his books. This one is a pleasure.
There isn't a way to review this book in detail without giving too much away. The concept, however, is clear. Those scientists we call truly great had such useful intuition that even when they were wrong, their errors pointed the way for others who'd never have gotten a better theory otherwise.
To take one example of the five in the book, Lord Kelvin (né William Thomson) calculated an age for the earth, based on temperatures in deep mines, and certain assumptions of thermal conductivity and initial temperature, of 100 million years. He was wise enough to do a bit of sensitivity analysis, and stated that the actual value would probably fall in the range 30-400 my. When others later showed that his assumption of solid conduction may not be correct, and that the earth could be much older, he stubbornly denied it. Yet, he was but one who had said the earth might be older if a source of energy other than remnant heat were involved. He died in 1907, so he didn't learn that radioactive decay is just such an energy source.
I wonder, is Kelvin's earlier underestimate really a blunder? Under the assumptions he made, it was quite valid. And his aim was not quite what we think. There were, at that time, two opposed camps. Biblical literalists maintained the dogma that the Earth is no more than some 6-8 thousand years old. Bishop Ussher's calculations putting Genesis 1:1 as the evening preceding October 23, 4004 BC was well known, but not without competitors. Yet few theologians, whether Christian or Jewish, were amenable to the geologists' contention that, as James Hutton had written in 1788, the Earth showed "no vestige of a beginning, no prospect of an end." Kelvin wished to correct both errors. He showed first that the rise in temperature with depth in mines indicated an Earth that had not always been as it is now. This should give pause to a geologist who might surmise there is infinite time for modern landforms to develop. Yet Kelvin then showed that deep time was still pretty deep, at least some tens of millions of years, not a few thousands. I find it astonishing that so many today (mostly in America) still deny a "geological" age for the Earth.
In the last section, the author explores the Cosmological Constant, Λ, which, the folklore tells us, Einstein called his "biggest blunder". Then he digs further, and determines that the "biggest blunder" statement probably originated with George Gamow, not Einstein. Einstein himself thought it might be an error once cosmological expansion was discovered. But he was unsure if it ought to be eliminated. Considering that Λ is now called "dark energy", and contributes about 75% of the gravity in the universe, his "error" or "blunder" (pick your favorite) makes up 3/4 of everything!
Oh, and just by the way, I am not certain if this interpretation of Λ is true. It is based on finicky measurements of supernova brightnesses, particularly in the 6-7 ga range of ages. I have yet to learn of a proper study of the effect of metallicity on peak luminosity of Type 1a supernovae, particularly the C/O composition of the original star. The general metallicity of the universe some 7 gy ago was about half what it is today, and was even less some half a billion years earlier when the stars that went "boom" at 7 ga were formed. Do we have another blunder in the making?
It has been occasionally said that some errors are so bad they are "not even wrong." The "blunders" limned in this book might be said to be "not quite wrong". We now have a better way to explain (theorize) each, but will future scientists look back at today's best theories as "not quite wrong, yet not quite right either"? Count on it.
I couldn't pass up the title: Brilliant Blunders: From Darwin to Einstein, Colossal Mistakes by Great Scientists That Changed Our Understanding of Life and the Universe, by Mario Livio. I was hoping it would be something better than one-upmanship ("See how much more we know now; aren't we good?"), and I was happily right. I've read an article or two by Dr. Livio—anyone has who has read publications by the STSCI—but none of his books. This one is a pleasure.
There isn't a way to review this book in detail without giving too much away. The concept, however, is clear. Those scientists we call truly great had such useful intuition that even when they were wrong, their errors pointed the way for others who'd never have gotten a better theory otherwise.
To take one example of the five in the book, Lord Kelvin (né William Thomson) calculated an age for the earth, based on temperatures in deep mines, and certain assumptions of thermal conductivity and initial temperature, of 100 million years. He was wise enough to do a bit of sensitivity analysis, and stated that the actual value would probably fall in the range 30-400 my. When others later showed that his assumption of solid conduction may not be correct, and that the earth could be much older, he stubbornly denied it. Yet, he was but one who had said the earth might be older if a source of energy other than remnant heat were involved. He died in 1907, so he didn't learn that radioactive decay is just such an energy source.
I wonder, is Kelvin's earlier underestimate really a blunder? Under the assumptions he made, it was quite valid. And his aim was not quite what we think. There were, at that time, two opposed camps. Biblical literalists maintained the dogma that the Earth is no more than some 6-8 thousand years old. Bishop Ussher's calculations putting Genesis 1:1 as the evening preceding October 23, 4004 BC was well known, but not without competitors. Yet few theologians, whether Christian or Jewish, were amenable to the geologists' contention that, as James Hutton had written in 1788, the Earth showed "no vestige of a beginning, no prospect of an end." Kelvin wished to correct both errors. He showed first that the rise in temperature with depth in mines indicated an Earth that had not always been as it is now. This should give pause to a geologist who might surmise there is infinite time for modern landforms to develop. Yet Kelvin then showed that deep time was still pretty deep, at least some tens of millions of years, not a few thousands. I find it astonishing that so many today (mostly in America) still deny a "geological" age for the Earth.
In the last section, the author explores the Cosmological Constant, Λ, which, the folklore tells us, Einstein called his "biggest blunder". Then he digs further, and determines that the "biggest blunder" statement probably originated with George Gamow, not Einstein. Einstein himself thought it might be an error once cosmological expansion was discovered. But he was unsure if it ought to be eliminated. Considering that Λ is now called "dark energy", and contributes about 75% of the gravity in the universe, his "error" or "blunder" (pick your favorite) makes up 3/4 of everything!
Oh, and just by the way, I am not certain if this interpretation of Λ is true. It is based on finicky measurements of supernova brightnesses, particularly in the 6-7 ga range of ages. I have yet to learn of a proper study of the effect of metallicity on peak luminosity of Type 1a supernovae, particularly the C/O composition of the original star. The general metallicity of the universe some 7 gy ago was about half what it is today, and was even less some half a billion years earlier when the stars that went "boom" at 7 ga were formed. Do we have another blunder in the making?
It has been occasionally said that some errors are so bad they are "not even wrong." The "blunders" limned in this book might be said to be "not quite wrong". We now have a better way to explain (theorize) each, but will future scientists look back at today's best theories as "not quite wrong, yet not quite right either"? Count on it.
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