The social life of ideas

I re-read a book I first read in 2002 when the first UK paperback was published, Louis Menand’s magnificent The Metaphysical Club: A story of ideas in America. It takes a sweeping view of the reshaping of the climate of ideas in the US after the Civil War, when pre-war traditions were replaced thanks to a combination of influences: the professionalisation of intellectual life in universities, the impact of scientific discovery particularly Darwin, and indeed the consequences of the Union victory. By the late 19th century the broadly defined pragmatist perspective that lasted until the 1960s – including an accommodation among White Americans over the status of African-Americans – was in place. The story is told though the intertwined histories of William James, Charles Peirce, Oliver Wendell Holmes and John Dewey.

The book lived up to my memory of its excellence, although newly poignant as the idea of an intellectual life among the new US ruling class seems increasingly like a contradiction in terms. I picked out moments that speak to my current preoccupations. For example, on the impact of The Origin of Species, that it emphasized difference or variation as an organising principle, not common characteristics. Some quotes that seem particularly relevant now: Everything human beings do by choice rather than by instinct, and course of conduct they choose when they might have chosen differently, is a moral action.”

William James arguing that society is the fact of life, and the idea of a non-social individual is pure abstraction, while Dewey agreed that there are no individuals without society: “Dewey taught that doing is why there is knowing.” Holmes meanwhile argued that experience – which defines the practice of justice – “is social, not psychological”, his construct of how the ‘reasonable man’ would judge being defined with respect to society.

Menand concludes: “Everything James and Dewey wrote as pragmatists boils down to a single claim: people are the agents of their own destinies. They dispel the fatalism that haunts almost every 19th century system of thought. … What Holmes did not share with those thinkers was their optimism. He did not believe that the experimental spirit will necessarily lead us, ultimately, down the right path. Democracy is an experiment, and it is in the nature of experiments sometimes to fail.” As he had seen it fail as a combatant in the Civil War.

Of course it won’t do to project today’s angst directly onto a 20+ year old book. But it is a brilliant and highly relevant read.

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In thrall to games?

Hidden Games: The surprising power of game theory to explain irrational human behaviour by Moshe Hoffman and Erez Yoeli does exactly what it says on the cover. It’s an interesting strategy (ahem): irrational behaviour turns out to be rational after all! When being over-optimistic about our own abilities, fooling ourselves by only believing social media comments that reinforce our prior beliefs, spinning the truth, or over-spending on costly luxury goods, all these and more behavioural phenomena can be explained as dominant strategies in appropriately described games. It’s all about the Nash equilibria, stupid.

I enjoyed the book on the whole. It’s a breezy introduction to game theory applications, written with a light touch and plenty of anecdotes. An early chapter sets the scene with the classic evolutionary explanation for observed sex ratios, moving on then to the Hawks and Doves game, and of course the Prisoners’ Dilemma features extensively too.

It has always astonished me how few people think strategically at all, such that a read of the classic (1993) Thinking Strategically on how to apply game theory by Avinash Dixit and Barry Nalebuff would help almost anybody. I can remember once observing in a committee meeting (all economists) what the Nash equilibrium in a certain policy situation involving all EU member countries would be, which did my reputation among those colleagues a power of good as this made it obvious what decision our (UK) politicians would take, regardless of any economic advice we delivered.

Hidden Games does some of the same groundwork as Thinking Strategically in its first half, throwing in a brief explanation of Bayes theorem en passant. I found it less compelling when it gets to the second half, explaining the ‘irrational’ as Nash equilibria in various games. Perhaps this is because there are already pretty powerful models, whether cognitive – eg the rule-of-thumb argument about conserving brain energy in making decisions – or economic – classic signalling models. The application of game theory seems more interesting in contexts of collective choices (as in Kaushik Basu’s wonderful The Republic of Beliefs) than in individual decision-making.

Having said that, if you don’t mind the trope about rationalising the irrational, Hidden Games is a very nice introduction to applying game theory to life, an enjoyable read.

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Wolves on the trading floor

My lockdown days have become filled with Zoom meetings at the expense of reading on tubes and trains. I’m definitely going to try to cut down on the online calls, which are exhausting (& I hope tech-land is working out why, and trying to fix it).

Meanwhile, I read a very good biography of Walter Gropius by Fiona MacCarthy, another of the wonderful Maigret novels, and also The Hour Between Dog and Wolf: risk taking, gut feelings, and the biology of boom and bust by John Coates.

It’s a really interesting book about the role biological/neurological responses in decision-making, applied to the financial market context. It will surprise nobody to learn that testosterone is one of the key players, generating bull markets (hah!) and excess risk-taking. “Traders are walking time bombs, and banks invariably light the fuse, dangling before them huge risk limits and bonus payments.” There seem some obvious regulatory interventions in the financial context eg ban bonus structures and mandate 50% female employees on trading floors. The book points out that at most 5% of traders are women, even though they outperform men over the long term.

The book braids together sections on the biology and sections tracking the various hormones and nervous impulses in a financial market boom. It’s a terrific read and super-clear. The author is a financial markets guy turned research scientist and having both sets of insights is illuminating.

The part that most interested me though – and that put me on to the book via an FT article about the impact of uncertainty on our health – was pondering what it means for a computer to think and make decisions when human decision-making is so firmly embodied, driven by our physical features, the way the chemicals in the blood stream and the nervous signals shape perception and emotion. The book I’ve now started (Economic Life in the Real World by Charles Stafford ) cites Antonio Damasio’s work in Descartes’ Error: people whose emotions are affected by brain injury are worse at making ‘rational’ decisions. Reason and emotion – involving biochemical and neurological phenomena – go hand in hand. Meanwhile, we are building AIs according to an idea of ‘reason’ modelled on homo economicus.

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The importance of small decisions

The importance of small decisions (by M O’Brien, A Bentley and W Brock) is a neat little primer on an evolutionary approach to decision theory. I read it under the influence of severe jet lag and so nothing at all should be read into the fact that I find it hard to summarise the argument – there’s also an awful lot of explanation by way of analogy to American football, which doesn’t help me at all. My takeaway is the title, plus this very neat diagram putting decision making modes into four quadrants separated along the dimensions transparent/opaque and individual learning/social learning:

      Quadrants

It’s a short book so anyone whose interest is piqued will find it easy to read (sporting analogies aside).

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Cognitive engineers, not choice architects

Although I’ve been reading at least as much as ever, it’s been difficult to find time to post about the books, given the length of my To Do list and the depth of untackled emails. One book I finished a while ago and wanted to flag up was Cognitive Gadgets: the cultural evolution of thinking by Cecilia Heyes. This is outside my territory, but as she incorporates cognitive science and linguistics in her work, I’ll be bravely inter-disciplinary too.

The book’s argument – as the subtitle flags up –  is that humans’ distinctive cognitive abilities are due to cultural evolution rather than genetic. It considers the evidence for cognitive differences between human babies and newborn chimps, and concludes that are rather subtle although importantly including a greater human ability to learn, and to remember. Then as humans grow we acquire our far greater distinctive cognitive skills from the society around us – they are not encoded in our minds, they are not simply shaped by social learning, but rather mechanisms or ways of thinking that have been built by cultural evolution: “They are cognitive gadgets rather than cognitive instincts: pieces of mental technology that are not merely tuned but assembled in the course of childhood through social interaction.” Some parts of the gadgetry will of course be inherited genetically, but the assemblage is the result of natural selection operating on cultural variation.

The book argues that this approach overcomes one of the issues with the idea of memes, because the issue is what units are memes measured in? What does the force of natural selection actually operate on – tunes, ideas and other memes? This seems unlikely. Heyes suggests the memes are grist to the mill of cognitive mechanisms such as causal understanding, imitation, reading aloud, causal inference, language, and other ‘gadgets’. The best gadgets thrive in the cultural evolutionary process. When it comes to inheritance mechanisms, it is social and cultural learning. This can largely occur inside individuals’ minds, but can also involve social processes such as story-telling, learning to take turns, group dances, even teaching.

History suggests that these have been quite robust – here we are, after all, with all the warp and weft of modern life. However, the theory does suggest a certain vulnerability, as many of these mechanisms could fail to be passed on: “The cognitive instinct view implies that human nature is relatively invulnerable to catastrophe. In a decimated and isolated human population … the group would lose some of its knowledge and skills. However, with each birth there would be a new child equipped with Big Special cognitive instincts. … In contrast the cognitive gadgets view implies that both grist and mills would be lost.  … The capacity for cultural evolution, as well as the products of cultural evolution, could be lost.” We are already failing to pass on to many children some quite basic (you’d have thought) gadgets such as critical thinking. Heyes specifically suggests looking at how moral learning has evolved and continues to do so.

Anyway, amateur that I am, I found this a persuasive approach and a really interesting book to read. It suggests a different approach to thinking about decision-making – not for example as a matter of setting up choices in ways that nudge flawed humans to do the right thing (but then what makes the choice architects any wiser?). Instead the engineering challenge is devising better gadgets, which is surely difficult but then humanity has invented them before.

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