April 05, 2003

Cognitive Economics

Robert Waldmann thinks about a seminar he saw: Alberto Bisin presenting joint work with Jess Benhabib on cognitive economics:


robert's random thoughts: ...A pseudo explanation is that we fear regret -- to have had it and given it away. To me this is like saying morphine causes sleep because it has a dormative virtue.

One of the great bits of evidence from the psych literature is that overweight people can resist nibbling if they are remembering a 3 digit number but not if they are remembering a 7 digit number (see the magic number 7). They had to remember for 5 minutes or so. They weren't warned that they would be tempted with food. The guess is that in the heads of the 3-digit non-nibblers is 6 4 7 don't eat 6 4 7 don't eat 6 4 7 don't eat 6 4 7 don't eat 6 4 7 don't eat ?", while in the heads of the the 7-digit nibblers is "6 4 7 3 5 2 4 ; 6 4 7 3 5 2 4, 6 4 7 3 5 2 4 , hey why is my stomach full ???".

Maybe we make the Monty Hall blunder because there is an automatic "don't change horses in midstream, stick to your guns, many other cliches" mechanism which has evolved or been learned to help us fight dynamic inconsistency. That is, we have all decided to do something involving effort or abstinence in the future, all noticed that it seems a bad plan when the time for effort comes, all learned to be firm in our purpose.

Posted by DeLong at April 5, 2003 09:17 AM | TrackBack

Comments

"For some silly reason Bayes formula is not taught in elementary school, but it is simpler to see they should switch, since it is clear that one can always win either by staying or switching and the probability of winning by staying must be 1/3. So why didnít anyone switch ?"

just saw this edge.org article on "smart heuristics!"
http://www.edge.org/3rd_culture/gigerenzer03/gigerenzer_print.html

"At the beginning of the 20th century the father of modern science fiction, Herbert George Wells, said in his writings on politics, "If we want to have an educated citizenship in a modern technological society, we need to teach them three things: reading, writing, and statistical thinking." At the beginning of the 21st century, how far have we gotten with this program?"

and this cosma shalizi rant about no good popular books on stat-mech :D
http://www.cscs.umich.edu/~crshalizi/notebooks/stat-mech.html

Posted by: kenny on April 5, 2003 10:02 AM

Ahh, the "Monte Hall blunder". This subject may be one of the greatest dinner party trolls of all time. If I am reading these notes correctly, Robert seems to be the right way around, but this may merit elaboration.

Posted by: Tom Maguire on April 5, 2003 10:02 AM

"For some silly reason Bayes formula is not taught in elementary school, but it is simpler to see they should switch, since it is clear that one can always win either by staying or switching and the probability of winning by staying must be 1/3. So why didnít anyone switch ?"

http://www.edge.org/3rd_culture/gigerenzer03/gigerenzer_print.html
just saw this edge.org article on "smart heuristics!"

"At the beginning of the 20th century the father of modern science fiction, Herbert George Wells, said in his writings on politics, "If we want to have an educated citizenship in a modern technological society, we need to teach them three things: reading, writing, and statistical thinking." At the beginning of the 21st century, how far have we gotten with this program?"

http://www.cscs.umich.edu/~crshalizi/notebooks/stat-mech.html
and this cosma shalizi rant about no good popular books on stat-mech :D

Posted by: kenny on April 5, 2003 10:06 AM

aaugh! regret, should have switched browsers :D

Posted by: kenny on April 5, 2003 10:12 AM

I saw cognitive economics on Brads blog and clicked. I was shocked shocked to get to my blog (thanks Brad). I should confess I am his college room mate and have been link begging.

Anyway, I decided to cut out the middle man and post here directly on Inevitable Illusions : How Mistakes of Reason Rule Our Minds by Massimo Piattelli-Palmarini here (I've never met Massimo Piattelli-Palmarini and he is not paying me to advertize his book).

Massimo Piattelli-Palmarini argues two things. Cognitive illusions are like optical illusions and it is urgently important to teach people about cognitive illusions because they do a lot of damage.

This raises a question -- do we urgently have to teach about optical illusions ? Are optical illusions dangerous. My first thought was no. Optical illusions are almost harmless, mainly useful for parlour games (see McGuire post above).

Then I thought of one optical illusion velocitization. The motion sensors in our eye or brain seem to adjust their sensitivity so that people who have been driving on the highway perceive their speed after exiting as very low. I was taught about this in driver's ed and told it was a serious problem.

I personally wouldn't know because I live and drive in Italy where people drive at insane speeds whether or not they have recently been on the highway. Still I thought the example would be helpful to Massimo Piattelli-Palmarini if he survives his next visit home.

Posted by: Robert on April 5, 2003 04:09 PM

Robert wrote "Massimo Piattelli-Palmarini argues two things. Cognitive illusions are like optical illusions and it is urgently important to teach people about cognitive illusions because they do a lot of damage. "

Doesn't this fall into the realm of "Critical Thinking"? There are a number of techniques (mostly based on logic/maths) but also some verbal (syllogisms) and general processes (goggle Action Learning) which allow individuals and more importantly groups to think/reflect and adjust any misconceptions. There are some interesting graphical tools to help in this regard, one example is Horn maps (intended for complex social issues).

Take a look at fallacies which essentially try to win an argument by misaligning motivation rather than hard reason (e.g. you don't want weapons of mass destruction [insert hysteria], Saddam has [wave hands] weapons of mass destruction, ergo you don't want Saddam [push for change]). There are a number of techniques to help structure thinking (for example academics when writing papers usually stick to a mutually agreed format) so is the situation of not adopting them merely mental laziness or the fact that random monkey-keystroke via email is easier than hard thinking?

Posted by: LL on April 5, 2003 06:42 PM

The sunk cost fallacy is powerful in all walks of life, not least in politics and political economics.

Posted by: Jim Glass on April 5, 2003 07:31 PM

The interesting thing to me here is that apparently eating is the default, automatic activity, whereas not eating requires intent. The 7-digit number distracts the subject and he forgets his intent. This is totally different than the situation of about 95-99% of mankind throughout history, and helps explain obesity.

I believe that it's possible to cheat on these games by training yourself to remember 2-digit numbers: 64,73,52, 4. I think that it's not the number of digits, but the number of slots; I've been told that the threshold for easy memory is 6 for most people. Observing bingo players might be a good experiment.

Posted by: zizka on April 6, 2003 09:04 AM

zizka,

You may be applying the notion of "intent" to two very different situations when discriminating between "95-99% of mankind throughout history" and the experimental subjects in the example at hand. Given free access to food, I'd guess 95-99% of mankind would eat as a default activity. Intent has been required only because food has been scarce. If modern obese people were faced with a scarcity of food, eating could not be an automatic activity and they, too, would have to eat intentionally. Or have I missed the distrinction you were trying to make?

LL,

Agreed that the stringent forematting of research writing requires discipline that can avoid certain logical errors. Is is not likely, though, that it makes other types of "errors" such as missing ideas that don't spring readily from the format of research writing. I don't know whether formalizing a method of thinking on paper is more or less likely to stifle alternative approaches to thinking than formalizing a method of thinking in one's brain. I understand the frustration of facing thinking that simply will not surrender folk wisdom of fondly held misconception, but I wonder whether there aren't ideas and methods of thinking, good ones, that die when statistics, logic, the mashalling of facts in a formally accepted way, are the overwhelming norm.

Posted by: K Harris on April 7, 2003 06:42 AM

My point was just that obesity is in part the result of a situation when food is always available, and that not-eating becomes the difficult task.

Time will tell with the Chinese. Taiwan was pretty prosperous in 1984 when I was there, but there still weren't many fat people. If you saw someone fat, you sort of assumed that he was the no-good son of a rich man. The Chinese have an elaborate food culture; very ordinary people can be gourmets, but everyone hates gluttons. At family dinners, the tastiest bits of food are offered to people by others as rewards, whereas someone who zeros in on the good stuff for himself is hated.

When I was there food was readily available on the street all day long until bedtime, but you didn't have the marketing we do.

Posted by: zizka on April 7, 2003 12:58 PM
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