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Elinor Ostrom

Somehow the passing of Elinor did not come to my attention. Here is IU’s remembrance page.

Economist obituary

Tell me about some of the key people and publications that have influenced you over the years

Herbert Simon and Douglass North have both been very influential on my work: Herbert Simon for his work on rational behavior, including his ‘The Sciences of the Artificial’ [MIT Press, 1972], and an article in the 1950s on a behavioral model of rational choice and bounded rationality; and Douglass North with his various books on institutional arrangements.

Vincent Ostrom has also been influential; I wouldn’t have gotten the Nobel Prize but for his influence on me over the years. We were both very much involved in the early public choice movement. Related to the early developments of public choice would be James Buchanan, Gordon Tullock, James Coleman and William Riker. The issue early on was how to broaden the social sciences to have genuine interdisciplinary work. In the early days, and again more recently, it has been an effort to really bridge the disciplinary divides. Across the years, the Public Choice Society has tried very hard to bridge the social sciences divide.

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Is Behavioral Economics Doomed?

Here is a skeptical take on the insights supposedly offered by the rise of behavioral economics as represented by Daniel Kahneman and others. Since I’m in the process of reviewing Kahneman it will be interesting to see if Levine’s take on behavioral economics jibes with my take on Kahneman in particular and behavioral economics in general – I have a strong sense that is unlikely to be the case.

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Hayek and Behavioral Economics: Mindscapes and Landscapes: Hayek and Simon on Cognitive Extension

I see that the publisher now has a fully detailed page up for a volume that I’ve been privileged to be a part of. The Foreword is by a very nice chappie going by the name of V.Smith and includes luminaries such as McCloskey, Boettke, Gintis, Steel and others. My abstract:

Mindscapes and Landscapes: Hayek and Simon on Cognitive Extension

Hayek’s and Simon’s social externalism runs on a shared presupposition: mind is constrained in its computational capacity to detect, harvest, and assimilate “data” generated by the infinitely fine-grained and perpetually dynamic characteristic of experience in complex social environments. For Hayek, mind and sociality are co-evolved spontaneous orders, allowing little or no prospect of comprehensive explanation, trapped in a hermeneutically sealed, i.e. inescapably context bound, eco-system. For Simon, it is the simplicity of mind that is the bottleneck, overwhelmed by the ambient complexity of the environmental. Since on Simon’s account complexity is unidirectional, Simon is far more ebullient about the prospects of explanation. Hayek’s social externalism functions as a kind of distributed “extra-neural” memory store manifest as dynamic spontaneous orders. Simon’s organizational rule-governed externalism negotiates the “inner” world (the mind) with the “outer” world through a homeostatic interface that offloads the cognitive burden into the environment. Their respective externalisms may differ in detail but not in spirit in that it ameliorates their shared presupposition of cognitive constraint. Even though any “optimization talk” for Hayek and Simon is objectionable, knowledge acquisition can be represented by a contextualized stigmergic swarm optimization algorithm that gives due emphasis to both the individual and the environment. The key insight is that “perfect” knowledge is unnecessary, impracticable and indeed irrelevant if one understands the mechanism at work in complex sociality, a stigmergic sociality that in effect augments or scaffolds cognition.

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Remembering Herbert Simon

Simon died this day in 2001. Check out these two books – Models of a Man (as with most edited books this is uneven, but there is still much to recommend it) and Herbert A. Simon: The Bounds of Reason in Modern America, an excellent intellectual biography. Speaking of Simon, I have a paper coming out entitled “Mindscapes and Landscapes: Hayek and Simon on Cognitive Extension” to be found in a collection edited by Roger Frantz and Robert Leeson Hayek and Behavioural Economics” Vol 4 of Archival Insights into the Evolution of Economics with an introduction by non-other than Vernon Smith (whom I met in Tucson last May) and a host of other luminaries such as Herb Gintis, Deirdre McCloskey, Gerry Steele and others. Here is the abstract for my paper:

Hayek’s and Simon’s social externalism runs on a shared presupposition: mind is constrained in its computational capacity to detect, harvest, and assimilate “data” generated by the infinitely fine-grained and perpetually dynamic characteristic of experience in complex social environments. For Hayek, mind and sociality are co-evolved spontaneous orders, allowing little or no prospect of comprehensive explanation, trapped in a hermeneutically sealed, i.e. inescapably context bound, eco-system. For Simon, it is the simplicity of mind that is the bottleneck, overwhelmed by the ambient complexity of the environmental. Since on Simon’s account complexity is unidirectional, Simon is far more ebullient about the prospects of explanation. Hayek’s social externalism functions as a kind of distributed “extra-neural” memory store manifest as dynamic spontaneous orders. Simon’s organizational rule-governed externalism negotiates the “inner” world (the mind) with the “outer” world through a homeostatic interface that offloads the cognitive burden into the environment. Their respective externalisms may differ in detail but not in spirit in that it ameliorates their shared presupposition of cognitive constraint. Even though any “optimization talk” for Hayek and Simon is objectionable, knowledge acquisition can be represented by a contextualized stigmergic swarm optimization algorithm that gives due emphasis to both the individual and the environment. The key insight is that “perfect” knowledge is both unnecessary, impracticable and indeed irrelevant if one understands the mechanism at work in complex sociality, a stigmergic sociality that in effect augments or scaffolds cognition.

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Hayek and the “Use of Knowledge in Society”

Here is a draft of my entry for the SAGE Encyclopedia of Philosophy and the Social Sciences.

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Daniel Kahneman on Cognitive Traps

Daniel Kahneman’s recently released book Thinking, Fast and Slow aimed at a popular audience is certainly generating a great deal of press, so far as I can tell, most of it very positive. Here he is outlining his experimental work in a Ted Talk. As a behavioral economist much of what he says about rationality will have resonance for Hayek and Simon and other situated cognitive theorists. I think that much of what Kahneman says is consistent with Gunderman from the previous posting though they are of course very different thinkers.