- China looks like the big winner in new trade negotiations Scott Sumner, MoneyIllusion
- Where does the Asian obsession with white skin come from? Ana Salvá, the Diplomat
- On Steven Pinker and The Blank Slate Arnold Kling, askblog
- In American higher education, hierarchy begets hierarchy Ethan Ris, JHIBlog
- David Graeber’s poor grasp of economics Scott Sumner, EconLog
- Is capitalism a threat to democracy? Caleb Crain, New Yorker
- When did we start talking about life from elsewhere? Caleb Scharf, Scientific American
- Russia or California? Conservatives in 2020 John Quiggin, Crooked Timber
- The conservative revolutionary and the archaic progressive Arnold Kling, Medium
- Epistemological anarchism to anarchism Bill Rein, NOL
- Against adaptation Chris Dillow, Stumbling & Mumbling
- Evolutionary drift Federico Sosa Valle, NOL
- Can Ottoman nostalgia be a good thing? Peter Gordon, Asian Review of Books
- Ottomanism, Nationalism, Republicanism Barry Stocker, NOL
- What is global history? One good answer (and one not so good answer) Krishan Kumar, Times Literary Supplement
- The world without the moon Caleb Scharf, Life, Unbounded
The institutional evolutionism has a history before Darwin, parallel to it and even later divergent. In parallel, Darwin for the elaboration of his concept of natural selection took from the political economy the notion of population analysis by Robert Malthus, the one that also comes from the analysis of the institutions as a framework of incentives. At the time Malthus sought to refute the anarchist philosopher William Godwin, who proposed abolishing marriage as a social institution. Mindful that the extra-marital children lacked at that time fewer rights than those born in marriage, Malthus replied that such a measure would lead to an exponential growth of the population and, therefore, marriage as an institution fulfilled the containment function of population growth. A similar analysis makes Malthus of the laws of poor: aid to the poor increases the cost of food, which generates more poor, assuming the dynamics of a vicious circle. The judgments of Malthus have an empirical character that makes them susceptible of refutation, it can be verified if Malthus was right or wrong. However, what has an abstract, methodological, propaedeutic character is its population analysis. That is what Darwin took to conceive natural selection processes and that today can be used in the analysis of institutional evolution.
When one speaks of a political, economic, or social institution displacing another, such movement becomes effective at the level of the populations. For example, literacy and accounting applied to business administration generates a leap in efficiency in the administration and auditing of businesses. It is not surprising that literate traders who carry inventory and accounting processes displace illiterate traders. This is how literacy and accounting can be extended without any central political decision, nor any disruptive phenomenon. (Of course, the modern state, in its process of rationalization, can impose the obligatory nature of certain principles of accounting or schooling, but not necessarily depend on it.)
To a large extent, the arrival of European immigration to South America in the second half of the 19th century consisted in the importation of habits, practices and techniques that immigrants already incorporated. It is widely known the arrival of new techniques of field work and breeding and care of livestock. Also many immigrants who arrived implemented inventory practices and cash management that were leaking into the rest of the population.
William Easterly characterizes this phenomenon as a leaking of knowledge. Following the example of the previous paragraph: those immigrants were more competitive because they brought with them new techniques of rationalization of time, they took inventories and accounted for income and expenditure of funds methodically. This advantage translated into prosperity and expansion of their businesses. However, in order to implement this type of “technology” they must necessarily share it with their collaborators. There is in these collaborators an incorporation of human capital through what Gary Becker called “on-the-job training”: a learning of how to work at a general level (to arrive at schedule, to concentrate on the task, to meet deadlines) and also at a particular level (particular techniques of sowing, raising livestock, managing a certain inventory system). Human capital is a set of habits and practices that “travels” incorporated in each “apprentice”. In this way, the entrepreneur can finance himself by paying part of the compensation to the dependent in kind: the training. On the other hand, there is the phenomenon characterized by Easterly as “leakage of knowledge”. This knowledge is transmitted, migrated, from person to person. To the extent that it reports a greater utility to its “bearer” it is expanding, extending, throughout the social fabric, often not as a deliberate education, but as an unintended consequence of the use of such knowledge, which, for can be put into practice, needs the help of more than one person.
It is in this sense that what evolve are the practices and habits, in this case of work and business. It is extended by its incorporation by individuals who adopt them, often involuntarily, either through the incorporation of guidelines from their place of work, or through imitation or emulation. Following the terminology of evolutionism, practices and habits are the unit of evolution and the people who incorporate their replicators. A practice or habit is more successful to the extent that it extends into the population. In turn, the populations carrying practices and habits more adapted to the environment will extend them to others.
The affirmation that one should not judge the historical past with current values forms a topic as widespread as the disobedience to it. However, a conscious exercise of the evaluative critique of the past allows us to identify continuities and disruptions in institutional patterns, i.e., in systems of incentives that are considered legitimate, whether by virtue of a question of social utility or principles.
Caste systems are obvious examples in which a differentiated attribution of rights, that is to say the legal protection of the interests of individuals assigned to a certain ethnic group, was interpreted as legitimate because it was a matter of principle.
While a caste is defined by an ethnic component, or at least with respect to its physiognomic marker, in the status system the ethnic differences lose preponderance, to transfer it to the different private orders or privileges that determine a function within the society. In both cases, both in the system of castes and status, it should be noted that they not only define privileges for its members but mainly establish obligations: war, worship or field work, for example. While the cult is reserved for a certain caste, in the status societies the cult is an institutionalized function, an order, whose members fulfilled certain procedures of admission and permanence.
In any case, beyond the similarities and differences in the systems of castes and status, what matters in this case is to emphasize that such attributions of rights and obligations, that is, of legal protection of interests, collective or particular, do not respond to a question of social utility but of principles. In the first place, because in such societies the power is fragmented and therefore there is no central power that can perform a critical judgment on the social utility of a given system of incentives; at the most, if there is a king, he assumes a role of primus inter pares, an arbitrator between castes or statuses or protector of order.
The emergence of central governments demanded the emergence of stable bureaucracies supported by a tax system to be systematized in a public accounting, that is, a calculation of utility. On the other hand, the incorporation of abstract procedures from private law to the administration of the government, displacing the systems of sages, mandarins, humanists, etc., allowed a better centralization and control and rational administrative decisions. However, what is important to note here is that such institutional innovations did not necessarily depend on a disruptive change, such as a revolution, but that many cases occurred through an evolutionary process, in which more efficient institutions displaced obsolete ones.
The emergence of central governments replaced fragmented political and social systems, because centralization allows a calculation of utility in decision making, which yields better results -not always but most of the time- than a decision system based mainly on honour. Most of the time but not always, since there is the possibility that, in a situation of extreme complexity, the calculation of utility has a wide margin of error and, in contrast, in such situations, a pattern of decisions based on emotions, traditions, or moral principles work as a kind of heuristic better adapted to the circumstances. After all, for the calculation of utility to be viable, it must have tools such as an accounting system, a literate bureaucracy, an abstract procedural system, among others. If you do not have such means, hardly a decision based on utilitarian issues is far from whimsical and arbitrary. Faced with such cases, traditional structures could be more efficient.
Another issue to consider is not to be confused between the rationalization of political power in a central administration – public budgets and control of their execution, a neutral and efficient tax system, administrative decisions of a particular nature adopted according to abstract and general procedures – with the rationalization of each subsystem of society and even of the individual in particular.
It is true that, as indicated by Max Weber, the bureaucratization of political power leads to the gradual bureaucratization of the rest of society: the generalization of the same accounting system for all companies, in order to verify compliance with tax obligations, the public instruction of the whole population, to name a few examples. These processes of rationalization are extremely beneficial and generate a jump in productivity. This is what William Easterly, in his work The Quest for Economic Growth, highlights as a phenomenon in which knowledge leaks and spreads throughout society. In this way the relations of complementarity generated by the knowledge shared with the rest of the individuals that make up a given community are much more important than the substitution effect could give an advantage to a single possessor of such knowledge. For example, having knowledge of accounting represents an advantage over the competition, but that all companies are organized according to reasonable and homogeneous accounting principles allows a jump in productivity throughout the system that yields even greater individual profits. Likewise, not only the leaking of knowledge is beneficial for all members of society, but reached a point is inevitable.
However, this does not mean that a rationalization of the society as a whole and of the individuals that compose it is necessarily possible or desirable; much less that such process is directed from a central political power. A process of compulsive and totalizing rationalization is not always modernizing. Both in biological and cultural terms, the evolution occurs in the margins, it is the mutations of small isolated populations that allow them to adapt to changes in the environment.
Moreover, the totalizing political systems, which not only seek to define from a central power each one of the functions of the social subsystems in function of a supposed calculation of utility, also seek to build a notion of “citizenship” that stifles the sphere of autonomy that defines each individual with civic obligations. Such conceptions are the first to see the processes of innovation and creative destruction and any individual initiative as dangerous. Thus, by cutting off all possible adaptation to changes in circumstances, by mutilating all possible discoveries, it is not uncommon for such political systems to experience stagnation and be displaced by other systems more open to innovation – or at least be invaded by results of said competition, discovery and innovation processes.
Countries can change their course, they can turn from stagnation towards growth, as it is the case of South Korea in the last fifty years. They can also decline after a boom period. Together with other examples of successes and failures, these are indications that economic performance does not depend on geography, culture, or the education of ruling elites. Following the line expressed by other authors such as Douglass C. North (Institutions, Institutional Change and Economic Performance, 1990), William Easterly (The Elusive Quest for Growth, 2001) and Daron Acemoglu and James A. Robinson (Why Nations Fail, 2012), it is appropriate to maintain that the economic performance of nations, expressed in their growth, depends on the incentives provided to individuals by institutional frameworks. The incentive systems -that is, the institutions- evolve, and with them the fate of the countries. But to achieve such evolution, there must first be a change in the level of commonly accepted notions about what is right and what is wrong for governments to put into practice. That is, what are the principles that should inform the legislative policy that puts into effect such institutional frameworks to order the expectations of society.
[Editor’s note: This is the first part of a new series. You can find the full essay here.]
- The strange relationship between virtue and violence Barbara King, Times Literary Supplement
- Nixon’s path to peace included bombing Cambodia Rick Brownell, Medium
- The suboptimality of the nation-state Branko Milanovic, globalinequality
- The threshold of land invasion Nick Nielsen, Grand Strategy Annex
The core assumption of economics is that people tend to do the thing that makes sense from their own perspective. Whatever utility function people are maximizing, it’s reasonable to assume (absent compelling arguments to the contrary) that a) they’re trying to get what they want, and b) they’re trying their best given what they know.
Which is to say: what people do is a function of their preferences and priors.
Politicians (and other marketers) know this; the political battle for hearts and minds is older than history. Where it gets timely is the role algorithms play in the Facebookification of politics.
The engineering decisions made by Facebook, Google, et al. shape the digital bubbles we form for ourselves. We’ve got access to infinite content online and it has to be sorted somehow. What we’ve been learning is that these decisions aren’t neutral because they implicitly decide how our priors will be updated.
This is a problem, but it’s not the root problem. Even worse, there’s no solution.
Consider one option: put you and me in charge of regulating social media algorithms. What will be the result? First we’ll have to find a way to avoid being corrupted by this power. Then we’ll have to figure out just what it is we’re doing. Then we’ll have to stay on top of all the people trying to game the system.
If we could perfectly regulate these algorithms we might do some genuine good. But we still won’t have eliminated the fundamental issue: free will.
Let’s think of this through an evolutionary lens. The algorithms that survive are those that are most consistent with users’ preferences (out of acceptable alternatives). Clickbait will (by definition) always have an edge. Confirmation bias isn’t going away any time soon. Thinking is hard and people don’t like it.
People will continue to chose news options they find compelling and trustworthy. Their preferences and priors are not the same as ours and they never will be. Highly educated people have been trying to make everyone else highly educated for generations and they haven’t succeeded yet.
A better approach is to quit this “Rock the Vote” nonsense and encourage more people to opt for benign neglect. Our problem isn’t that the algorithms make people into political hooligans, it’s that we keep trying to get them involved under the faulty assumption that people are unnaturally Vulcan-like. Yes, regular people ought to be sensible and civically engaged, but ought does not imply can.
It is well known that Friedrich Hayek once rejoiced at Noam Chomsky’s evolutionary theory of language, which stated that the faculty of speaking depends upon a biological device which human beings are enabled with. There is no blank slate and our experience of the world relies on structures that come from the experience in itself.
Hayek would be now delighted if he were told about the recent discoveries on the importance of background knowledge in the arms race between human beings and Artificial Intelligence. When decisions are to be taken by trial and error at the inside of a feedback system, humans are still ahead because they apply a framework of abstract patterns to interpret the connections among the different elements of the system. These patterns are acquired from previous experiences in other closed systems and provide with a semantic meaning to the new one. Thus, humans outperform machines, which work as blank slates, since they take information only from the closed system.
The report of the cited study finishes with the common place of asking what would happen if some day machines learn to handle with abstract patterns of a higher degree of complexity and, then, keep up with that human relative advantage.
As we stated in another place, those abstract machines already exist and they are the legal codes and law systems that enable their users with a set of patterns to interpret controversies concerning human behaviour.
What is worth being asked is not whether Artificial Intelligence eventually will surpass human beings, but what group of individuals will overcome the other: the one which uses technology or the one which refuses to do so.
The answer seems quite obvious when the term “technology” is related to concrete machines, but it is not so clear when we apply it to abstract devices. I tried to ponder the latter problem when I outlined an imaginary arms race between policy wonks and lawyers.
Now, we can extend these concepts to whole populations. Which of these nations will prevail over the other ones: the countries whose citizens are enabled with a set of abstract rules to based their decisions on (the rule of law) or the despotic countries, ruled by the whim of men?
The conclusion to be drawn is quite obvious when we are confronted with a so polarised question. Nevertheless, the problem becomes more subtle when the disjunction concerns on rule of law vs deliberate central planning.
The rule of law is the supplementary set of abstract patterns of conduct that gives sense to the events of the social reality in order to interpret human social action, including the political authority.
In the case of central planning, those abstract patterns are replaced by a concrete model of society whose elements are defined by the authority (after all, that is the main function of Thomas Hobbes’ Leviathan).
Superficially considered, the former – the rule of law as an abstract machine – is irrational while the latter – the Leviathan’s central planning – seems to respond to a rational construction of the society. Our approach states that, paradoxically, the more abstract is the order of a society, the more rational are the decisions and plans that the individuals undertake, since they are based on the supplementary and general patterns provided by the law, whereas central planning offers to the individuals a poorer set of concrete information, which limits the scope of the decisions to those to be based on expediency.
That is why we like to state that law is spontaneous. Not because nobody had created it -in fact, someone did – but because law stands by itself the test of time as the result of an evolutionary process in which populations following the rule of law outperform the rival ones.
According to Instapaper this article at Wait But Why is a “139 minute read.” And it was time well spent.
It’s about a new Elon Musk venture, Neuralink, but there’s plenty non-Musk stuff in there of interest. I’m agnostic on whether Elon Musk is or isn’t the next coming of the (anti-) Christ. What’s really interesting is the background material this article gives, building up a highly entertaining natural history of knowledge. The section below really captures the main thrust of that story, but it’s worth reading anyways.
That leads into a discussion of how brains work, that “soft pudding you could scoop with a spoon.” Here are some excerpts:
I’m pretty sure that gaining control over your limbic system is both the definition of maturity and the core human struggle. It’s not that we would be better off without our limbic systems—limbic systems are half of what makes us distinctly human, and most of the fun of life is related to emotions and/or fulfilling your animal needs—it’s just that your limbic system doesn’t get that you live in a civilization, and if you let it run your life too much, it’ll quickly ruin your life.
Which leads us to the creepiest diagram of this post: the homunculus.
The homunculus, created by pioneer neurosurgeon Wilder Penfield, visually displays how the motor and somatosensory cortices are mapped. The larger the body part in the diagram, the more of the cortex is dedicated to its movement or sense of touch. A couple interesting things about this:
First, it’s amazing that more of your brain is dedicated to the movement and feeling of your face and hands than to the rest of your body combined. This makes sense though—you need to make incredibly nuanced facial expressions and your hands need to be unbelievably dexterous, while the rest of your body—your shoulder, your knee, your back—can move and feel things much more crudely. This is why people can play the piano with their fingers but not with their toes.
Second, it’s interesting how the two cortices are basically dedicated to the same body parts, in the same proportions. I never really thought about the fact that the same parts of your body you need to have a lot of movement control over tend to also be the most sensitive to touch.
Finally, I came across this shit and I’ve been living with it ever since—so now you have to too. A 3-dimensional homunculus man.17
This is too far outside my area of specialization to say, but it’s certainly an entertaining read that seems to fit with what I know about these topics (although the section on neurology could be made up as far as I know).
From there it builds up to the moon shot idea Musk apparently has in mind: building the core technology for a high bandwidth mind-computer interface. This would be the ultimate logical extreme of a trend towards better interfaces that’s been going on since before punch cards. If you think over the natural history of knowledge, it becomes clear that this idea is ultimately just a few dozen steps further down a path we’ve been on for billions of years.
And the implications of taking it that far are profound. The pros and cons of that power are huge. Consider how much more powerful your brain is with paper and pencil than without. Or a computer. Or a computer with a GUI and a copy of Excel. Once you can plug into your computer Matrix-style, all those awesome hot keys that let you zip through your computer like a pro will be like roller skates next to a rocket sled. And the two-way link would mean we could genuinely exercise some self control… for example, by running a computer program that zaps you when you eat too much chocolate cake.
Readers of this blog will hear Hayek warning you! Such a device gives you a lot of power to manipulate a complicated thing in ways we may never be able to understand.
But this type of personal power might be a necessary bulwark against government or corporate power. Network externalities have already locked us in to Google and Facebook. A Byzantine government has created rent-seeking opportunities that puts enormous power in the hands of the politically connected. The NSA is terrifying. And machine learning will continue to get better, giving those entrenched players even more ability to understand and manipulate large numbers of people. (I’m not endorsing this forecast, just listing it as a possibility.)
In any case, even if Neuralink is just an April Fool’s joke I missed out on till now, this article provides a theory of knowledge that’s well worth reading.
In the near future I’ll argue why you need such a theory of knowledge. Stay tuned.