The impact of science and economics.

Shawn

What science has done to humanity has manifested in fields that govern our behavior upon sound scientific theory that lead to the best outcomes.

To name some fields that have arisen due to the advent of science and have had the greatest impact on our lives are game theory, political science, law and economics. I wont bother the reader with law and positivism, which are very consequentialist in how they value a decision, whether lawful or not. I am however a fan of utilitarianism and don't believe that there are too many self-made Kantians out there unless they are judges or attorneys.

Having studied economics, I want to stress the importance of game theory. Generally speaking, game theory is a field specializing in decision making and making the most optimal decision with what one has according to their current circumstances. We all make decisions, be it for shoes or bread or a place to live. A profound discovery made by the late John Nash, is the Nash Equilibrium which governs many decisions made in micro and macroeconomic decision making. It helps insure that Pareto optimality is maintained even when non-cooperative behavior manifests between two or more rational actors. Pareto optimality is defined as a point reached where no further changes to the stable state situation will produce any more benefit. What that means is basically that demand satisfies supply at the least amount of cost resulting in the greatest amount of benefit for unit of money spent. An interesting insight gleaned from this is that we ought to value Pareto optimal outcomes due to endemic scarcity. These are just brief examples showing how seemingly obscure and mundane insights gained at the lofty and prestigious ivory towers shape our daily lives. Which should shut up a philosopher about the banality of academia and worth of work with people. Philosophers should not be in the position to rule for the simple truth that they are unqualified to make sound scientific policies. So much for Plato's Republic.

Anyway, I would like to highlight that any good economist will be aware of the fact/value distinction. The fact/value distinction originated from Hume's is-ought distinction. What this means is that every meaningful statement in quantitative analysis ought to be based on sound reasoning adhering to scientific methodology. What does that translate to? Ideally it translates to valuing substance over ideals. I'm not a pragmatist or a postmodernist; as I often default to positivism to guide my behavior. I live in California where policymakers are quite democratic and progressive. Contrary to what you may think, public policy isn't determined through adherence to ideals; but, rather places like think tanks that mull over the economic benefits conferred to the masses. There are differing think tanks out there that analyze public policy measures according to cost/benefit analysis. I am just mentioning this to elucidate how economics shapes and determines our lives.

What are your thoughts? Ideas and comments welcome.

Andrew4Handel

↪Shawn

I get the feeling economics relies on treating people like objects and like they are dispensable and interchangeable and that we need to have children to create a steady flow of workers.

I am not sure that people and their psychology should be manipulated like chess pieces.

Here in the UK Politicians prefer to listen to economists over psychologists even when there policies repeatedly fail and psychologists have suggested they will based on their evidence data about human behaviour.

Shawn

I get the feeling economics relies on treating people like objects and like they are dispensable and interchangeable and that we need to have children to create a steady flow of workers. — Andrew4Handel

Economists treat most people as rational agents, not as objects. I believe that most people are treated fairly as workers, even here in the US and moreso in progressive states like New York or California with higher minimum wages. Whether workers are dispensable is arguable. Again, where I live there are quite a few laws prohibiting discrimination and biases from causing an employer from firing some worker. The rationale is simple, you perform your duties and you get payed for doing it, as long as the company is producing something profitable.

I am not sure that people and their psychology should be manipulated like chess pieces. — Andrew4Handel

There is some truth to this in the marketplace of goods and advertising. The amount of money from advertising is collosal and sustains companies that compete with other companies for the same products. For example, Google makes makes most of their money from advertising still. Yet, companies like Toyota don't make their money by appealing to customers based on presenting their product as more psychologically appealing than a Ford car.

Andrew4Handel

Economists treat most people as rational agents, — Shawn

Can you expand on this? Are they using a model or rationality taken from psychology or philosophy?

Some people say science and technology has been destructive in its progress because it has allowed us to suddenly over exploit the environment to cater to peoples short term desires which is not sustainable in the long term.

For example there was a huge upsurge in the usage of plastics which has led to pollution and microplastics in the ocean.

Is the model of rationality one that only considers individuals short term goals and selfishness or does it encompass the idea of humans having long term goals and not needing instant gratification.

I have fallen victim to my own need for instant gratification and demand for variety. But using a golden rule analysis I can see that my behaviour multiplied by everyone is likely unsustainable.

I found this on Wikipedia:

"Many economic theories reject utilitarianism and rational agency, especially those that might be considered heterodox.

For example, Thorstein Veblen, known as the father of institutional economics, rejects the notion of hedonistic calculus and pure rationality saying: "The hedonistic conception of man is that of a lightning calculator of pleasures and pains who oscillates like a homogeneous globule of desire of happiness under the impulse of stimuli that shift him about the area, but leave him intact.""

https://en.wikipedia.org/wiki/Rational_agent#Criticisms

Shawn

Can you expand on this? Are they using a model or rationality taken from psychology or philosophy? — Andrew4Handel

There's a field of economics that specializes in this area, called behavioral economics. Last time I was at college to get a degree in behavioral economics you would have to take quite a lot of classes in cognitive science.

So, I'm assuming the majority of modeling done is empirically based on consumer behavior. The concept of rationality is taken from psychology or cognitive science rather than philosophy as far as I understand.

Some people say science and technology has been destructive in its progress because it has allowed us to suddenly over exploit the environment to cater to peoples short term desires which is not sustainable in the long term. — Andrew4Handel

It would be unfair to label blame on science or technology. I don't think it makes sense to do so at any rate.

Is the model of rationality one that only considers individuals short term goals and selfishness or does it encompass the idea of humans having long term goals and not needing instant gratification. — Andrew4Handel

In terms of what? A lot of economists are no longer preoccupied with Keynes in saying that in the long run we are all dead.

Andrew4Handel

It would be unfair to label blame on science or technology. I don't think it makes sense to do so at any rate. — Shawn

John B Watson went from pioneering Behaviourism with B F Skinner to using behaviourist techniques in advertising. We are bombarded with advertising and life style aspirational pressures.

The problem I see is in generating desires including dissatisfaction towards a model of infinite growth on a planet of finite size.

A lot of economists are no longer preoccupied with Keynes in saying that in the long run we are all dead. — Shawn

According to this:
"The median long run across the 23 papers is 32 years, with a median of 26.5 for micro and 34 for macro. So both fields pass the Keynes test; on average. But the distribution is impressive. In micro, studies range from a 3-year long run to a 350-year long run. In macro, studies range from 9 years to 10,000 years."

https://blogs.worldbank.org/impactevaluations/how-long-long-run

However around me I see what seems to be a very short term orientated society.

Shawn

The problem I see is in generating desires including dissatisfaction towards a model of infinite growth on a planet of finite size. — Andrew4Handel

Yes, dissatisfaction is valued quite a bit to any company invested in legacy products. Advertisers make their money from not always promoting superior products or more efficient products. On the other hand, Google made a quarter of a trillion dollars off of advertising in 2021. People on a fixed budget don't have the luxury to spend money on their preferences towards which good best satisfies them. Then again one has to consider the fact that our populations are so large that the target audience can return the cost of advertising from their purchases.

If the topic is to be about the downsides of advertising, then I feel comfortable to say that advertising targets human biases, opinions, and irrationality moreso than those in the marketing business are willing to admit. Then again they are protected by the nature of the free markets.

Agent Smith

Science & economics have made living easier, not better. Is this advancement/progress?

In a sense yes - why burden 100 people with 1 bulldozer's work? However, we only recently discovered what in business is termed as hidden costs of science & economics (the deadly cocktail that has poisoned the land, the water, and the air).

In another sense - no! What is the aim of modern science? It is to preserve and/or restore our environment + undo the damage it has inflicted on the biosphere. We already had a pristine, healthy, environment. The doctor poisons the patient and then comes calling with the antidote.

The impact of science and economics.

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