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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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Gintis on Hayek

Check out this recent paper by Herb Gintis entitled Hayek’s “Contribution to a Reconstruction of Economic Theory.” Herb’s paper is, I think, going to be part of an edited collection that I’m also contributing to and am still polishing up. I had the pleasure of meeting Herb just over a year ago at the Society for Behavioral Economics conference in San Diego. I recently read Herb’s The Bounds of Rationality – the title a clear nudge and a wink to that other Herb – H. A. Simon’s famous phrase. And it’s endorsed by none other Nobel laureate Vernon Smith who I happened to meet this past May at a conference.