Posts tagged growth
Posts tagged growth
In the third-to-last and second-to-last paragraphs of The Stuff of Thought (pp. 438-439, emphasis added), Steven Pinker writes:
When all the pieces fall into alignment, people can grope their way toward the mouth of [Plato’s] cave. In elementary education, children can be taught to extend their number sense beyond “one, two, many” by sensing an analogy between an increase in rough magnitude and the order of number words in the counting sequence. In higher education, people can be disabused of their fallacies in statistics or evolution by being encouraged to think of a population as a collection of individuals rather than as a holistic figure. Or they can unlearn their faulty folk economics by thinking of money as something that can change in value as it is slid back and forth along a time line and of interest as the cost of pulling it forward. In science and engineering, people can dream up analogies to understand their subjects (a paintbrush is a pump, heat is a fluid, inheritance is a code) and to communicate them to others (sexual selection is a room with a heather and a cooler). Carefully interpreted, these analogies are not just alluring frames but actual theories, which make testable predictions and can prompt new discoveries. In the governance of institutions, openness and accountability can be reinforced by reminding people that the intuitions of truth they rely on in their private lives—their defense against being cheated or misinformed or deluded—also apply in the larger social arena. These reminders can militate against our natural inclinations toward taboo, polite consensus, and submission to authority.
None of this, of course, comes easily to us. Left to our own devices, we are apt to backslide to our instinctive conceptual ways. This underscores the place of education in a scientifically literate democracy, and even suggests a statement of purpose for it (a surprisingly elusive principles in higher education). The goal of education is to make up for the shortcomings in our instinctive ways of thinking about the physical and social world. And education is likely to succeed not by trying to implant abstract statements into empty minds but by taking the mental models that are our standard equipment, applying them to new subjects in selective analogies, and assembling them into new and more sophisticated combinations.
The one thing I want to add is: moral education serves an analogous purpose: to make up for the shortcomings in the behavior our untutored instincts would lead us into.
Steven Pinker, in The Stuff of Thought, pp. 437-438, writes:
… The intuition that ideas can point to real things in the world or can miss them, and that beliefs about the world can be true or just believed, can drive people to test their analogies for fidelity to the causal structure of the world, and to prune away irrelevant features and zero in on the explanatory ones.
Needless to say, this combination of aptitudes does not endow any of us with a machine for churning out truths. Not only is a single mind limited in experience and ingenuity, but even a community of minds won’t pool and winnow its inventions unless their social relationships are retuned for that purpose. Disagreements in everyday life can threaten our sense of face, which is why our polite interactions center on topics on which all reasonable people agree, like the weather, the ineptitude of bureaucracies, and the badness of airline or dormitory food. Communities that are supposed to evaluate knowledge, such as science, business, government, and journalism, have to find workarounds for this stifling desire for polite consensus. At a scientific conference, when a student points out a flaw in a presenter’s experiment, it won’t do to shut her up because the presenter is older and deserving of respect, or because he worked very hard on the experiment and the criticism would hurt his feelings. Yet these reactions would be perfectly legitimate in an everyday social interaction based on authority or communality.
… In science and other knowledge-driven cultures, the mindset of communality must be applied to the commodity of good ideas, which are each treated as resources to be shared. This is a departure from the more natural mindset in which ideas are thought of as traits that reflect well on a person, or inherent wants that comrades must respect if they are to maintain their communal relationship. The evaluation of ideas also must be wrenched away from our intuitions of authority: department chairs can demand larger offices and salaries, but cannot demand that their colleagues acquiesce to their theories. These radically new rules for relationships are the basis for open debate and peer review in science, and for the checks and balances and accounting systems found in other formal institutions.
This article by Ryan Avent situates the argument for free trade as part of a larger argument for “market potential,” using Natalia Ramondo, Andres Rodriguez-Clar and Milagro Saborio-Rodriguez’s NBER Working Paper “Scale Effects and Productivity Across Countries: Does Country Size Matter.”
Steven Pinker, in The Stuff of Thought, pp. 435, writes:
We can also be diverted from the brightly lit world of reality by the emotions infusing our language. The automatic punch of emotionally laced words can fool us into thinking that the words have magical powers rather than being arbitrary conventions. And the taboos on thinking and speaking that shield our personal relationships from the mutual knowledge that might break their spell can leave us incapacitated as we try to deal with problems at the unprecedented scale of a modern society. Scientific findings that seem to challenge authority or threaten social solidarity, from Copernican astronomy to evolutionary biology, have been shushed as if they were social faux pas, or condemned as if they were personal betrayals. And problems screaming for technical fixes, such as the American Social Security system, remain third rails that would electrocute any politician who touched them. Opponents can frame any solution as “putting a price on the welfare of our elderly citizens” (or our children, or our veterans), activating a taboo mentality that has a place in our dealings with family and friends but not in making policy for a nation of three hundred million people.
Steven Pinker, in The Stuff of Thought: Language as a Window into Human Nature (p. 409), writes:
Fiske’s taxonomy also accomodates a fourth relationship type [in addition to Communal Sharing, Authority Ranking, and Exchange], which he calls Market Pricing. It embraces the entire apparatus of modern market economies: currency, prices, salaries, benefits, rents, interest, credit, options, derivatives, and so on. The medium of communication is symbolic numerals, mathematical operations, digital accounting and transfers, and the language of formal contracts. Unlike the other three relationship types, Market Pricing is nowhere near as universal. A culture with no written language and with a number system that peters out at “3” cannot handle even the rudiments of Market Pricing. And the logic of the market remains cognitively unnatural as well. People all over the world think that every object has an intrinsic fair price (as opposed to being worth whatever people are willing to pay for it at the time), that middlemen are parasites (despite the service they render in gathering goods from distant places and making them conveniently available to buyers), and that charging interest is immoral (despite the fact that money is more valuable to people at some times than at others).[See Thomas Sowell: Knowledge and Decisions.] These fallacies come naturally to an Exchange mindset in which distributions are fair only when equivalent quantities of stuff change hands. The mental model of face-to-face, tit-for-tat exchanges is ill equipped to handle the abstruse apparatus of a market economy, which makes diverse goods and services fungible among a vast number of people over great distances of time and space.
As far as I can see, this takes Market Pricing out of the realm of human nature, and there seem to be no naturally developing thoughts or emotions tailored to it.
In “Whose Freedom: The Battle over America’s Most Important Idea,” p. 56, George Lakoff writes:
But science is about more than mere belief or conjecture. Science is fundamentally a moral enterprise, following the moral imperative to seek truth. Science is fundamentally about freedom, freedom of inquiry into the truth without the bias of initial faith or belief. Within science as an institution, a “scientific theory” is in fact a material explanation of a huge range of data based on experiment and evidence. Within science, it is normal for theories to compete. The basis of competition is clear: amount of evidence, convergence of independent evidence from many areas, coverage of data, crucial experiments, degree and depth of explanation. The judges of the competition are distinguished scientists who have spent their careers studying the scientific evidence.
In the science of biology, evolution wins the competition, governed by the rules of the scientific method, hands down. There are no other legitimate competitors. Freedom here is freedom of objective inquiry, on the basis of evidence and explanation. Other theories are free to enter the competition, but if they do not follow the rules of the competition, they will be eliminated—fairly and justly.
Sometimes a sector of the economy has so much technological progress that over many decades, output in the sector increases while inputs into the sector—particularly the amount of labor used—decreases. Agriculture went through this transformation first. In more recent decades, manufacturing employment has been shrinking while manufacturing output has been growing. Just as we need only a few farmers to feed everyone, we are moving toward a world where we only need a few people to manufacture things, while almost everyone is employed in the service sector.
Neil Irwin describes this transformation in his post “American manufacturing is coming back. Manufacturing jobs aren’t.”
This is a thoughtful piece. The worries and prescriptions are unsurprising, but Uri Dadush’s and Moises Naim’s discussion of the underlying strengths of the U.S. economy is a useful antidote to alarmism.
I find this post by Duncan Green about the direction of the field of Economic Development especially interesting because I know people on both sides of this debate. I met Lant Pritchett when he was in graduate school at MIT and I was at Harvard since we were both in the same Mormon congregation at that time, and my wife Gail and I have kept up with Lant and his wife Diane to some degree in the years that followed. On the other side of the debate, several of my colleagues are involved in randomized controlled trials in the developing world.