Saturday, June 24, 2017

321. Adaptiveness

In the preceding item in his blog I discussed emergence, where elements produce wholes with properties not present in the elements. Emergence is studied as ‘adaptation’ in the research field of Complex Adaptive Systems (CAS). A subfield of that is that of Agent-Based Computational Models (ABCM). There, interaction and adaptation of agents is simulated in computational models. I have used that, with a PhD candidate and a postdoctoral researcher, to study whether and how trust can arise in markets.[i]  

In general, such a model has at least the following elements: properties of agents (such as capabilities, preferences), a representation they make of relevant elements in their environment, rules for decision making, a mechanism whereby they observe and evaluate each other, adaptation, i.e. strengthening or weakening of rules and preferences, depending on perceived success, and the invention of new rules.

In this case the central question was under which circumstances, if at all, trust can emerge in markets, even while profit is the criterion of success, and agents can choose between competition and collaboration. They form an opinion on the trustworthiness of partners on the basis of loyalty in collaboration. Next to profit, trust may form part of the value of collaboration. The weight attached to trust relative to profit is adaptive, depending on realised profit. Their own trustworthiness is also adaptive. It is modelled as a threshold of defecting from a relationship: the higher the threshold, he greater the loyalty. In adaptation there is also a random element.

De model enabled us to investigate when and how frequently trust may grow even though success is measured as profit. The aim was to test claims from economics that under competition trust cannot survive. According to the simulations with the model, often trust does indeed grow, but it depends on the circumstances, governed by the settings of parameters of the model.     

Beyond this modelling, here I give a reflection on traits that help adaptiveness. If through the uncertainty of emergence it is not possible to determine ahead of time what may happen, then one must be prepared for the unexpected. There are several ways for his.

In robustness one chooses a way that is not sensitive to unexpected turns. Then one may lose some benefit in some cases but avoids heavy loss in others. Robustness can be explored in scenario analysis. There, one invents different possible futures (scenarios) to investigate how sensitive options are to differences between them.

In flexibility one choses a way that can easily and quickly be replaced by another, to adapt to circumstances as they arise.

In resilience one is resistant, able to incur and absorb adversity. One form of that it is create slack: excess capacity to absorb unforeseeable shocks, in money, time, space, reputation, or cognitive capacity.    

In Inventiveness one learns to learn, to invent new ways, depending on experience, and to analyse the conduct of others for their success, and to deliberately seek novel challenges by which one can discover new ways. That is found in the theory of invention that I discussed earlier in this blog (items 31, 35). 

Diversity is important for the evolution of a group (such as a species, in evolution, or an industry, in markets), and for discovery. It increases the chance that at least ome of the various forms fits whatever emerges.

[i] See: T. Klos & B. Nooteboom, Agent-based computational transaction cost economics,
Journal of Economic Dynamics and Control, 25 (2001): 503-526, Alexander Gorobets & Bart
Nooteboom, Adaptive build-up and breakdown of trust: An agent-based computational approach,
Journal of management and Governance,10 (2006): 277-306.

Saturday, June 17, 2017

320. Emergence

Reductionism is a form of scientism: the idea that natural science is the only respectable form of knowledge, on the basis of experimental facts and rigorous, preferably mathematically formalised argument. Reductionism is analytical: it decomposes phenomena into fundamental elements that together explain the whole.  

The opposition claims that ‘the whole is more than the sum of its parts’. In the formation of the whole something is added that cannot be found in the parts. That is called emergence. Aristotle already talked about it.  

Emergence is akin to self-organization. That arises in nature, as in evolution, where forms do not arise from ‘intelligent design’, but from random trials that are selected out when they do not function well enough to survive and replicate.

More generally, in emergence elements have a potential to unfold properties, in interaction with each other, and develop collective properties, depending on the environment.  

The fundamental theoretical argument for the novelty that is added in synthesis is the following. The whole, be it an organ, an organism, a brain, a sentence, an organization, a market, or a society, must achieve some coherent functioning to survive in its environment, which determines what works and what does not, and it must incorporate the conditions for it. As a consequence, not everything comes ‘from inside’, from the components, but also from outside, the functional conditions for survival. In that, the whole reflects the external conditions, which did not lie in the parts.  

Emergence arises widely in nature and society, on many levels. Chemistry arises from physics, biology from chemistry, evolution from genes, consciousness from neurons, organizations from people, markets from firms, consumers and institutions, societies from people, communities, culture, language and institutions.

In language, the meaning of a sentence depends on the meanings of words in it, but also, the other way around, word meaning also depends on sentence meaning. Earlier in this blog, I used the hermeneutic circle to analyse this (items 36, 252 in this blog). Concepts are embedded in sentences, where they obtain one of several potential meanings, but in the action context they can also acquire a new meaning, which shifts the concept. Here, the outside selection lies in the language community, and in what Wittgenstein called language games.

Meanings and ideas arise from action in the world. I proposed (in item 29) that this yields an object bias in our conceptualization of abstract notions as if they are like things moving in time and space, and in terms of ‘what you can do with them’ (affordances). That also connects with the idea from pragmatist philosophy that truth can be seen as ‘what works’.

Relationships are emergent. If individuals develop their perception and ideas, and their judgements, in interaction with their physical and social environment, then the course of  relationship is fundamentally uncertain. That means that it is not known beforehand what can happen. One may have expectations about what people may do, but one is regularly caught by surprise. One cannot even reliably predict one’s own responses.

In groups, social constellations, complexity increases further, in on he ne hand mimicry of conduct and on the other hand rivalry and rebellion, in agreement or conflict. As discussed elsewhere in this blog (item 205), it looks like people have both an instinct for survival, by protecting their interests, and an instinct for altruism, at least within one’s own group, where one is prepared to make sacrifices at the cost of self-interest, in what is called ‘parochial altruism’.

Organizations and institutions can lead to what I have called ‘system tragedy’ (items 109, 159, 187 in this blog). The culture of an organization, the (international) markets in which it finds itself, and the public institutions of laws and regulations, form expectations, positions, roles, interests, and entanglements between them, which routinely yield outcomes that were not expected or intended, and where guilt cannot easily be attributed to single individuals, who often could not, or did not dare to act otherwise, given their positions. An example is that of ‘the banks’.

History is even more complex. It anything is unpredictable it is that. Look at what has happened in just one year, with the rise of populism, the election of Trump, Brexit, and the rise, apparently out of nowhere, of Emmanuel Macron. With each of those one would have been declared a lunatic if one had predicted it. Where does that complexity come from?

In an earlier item in this blog (item 100), concerning the nature of causality, I analysed the emergence of the Dutch United East India Company (VOC) in the 16th-17th century, as a mix of causal factors of different kinds: accidental conditions of climate and geography, entrepreneurial action, eclipse of competitors, technological and organizational innovations, in more or less accidental ‘novel combinations’, and conditions of war. If any of those factors had been different, or occurred at another moment, nothing or something entirely different might have occurred.

Saturday, June 10, 2017

319. Conformism, reputation, empathy, and morality

In my earlier analysis of altruism I contrasted it with self-interest, and conflated it with the desire to be seen as a loyal member of a group. Here, I want to refine the analysis by distinguishing between conformism, empathy-based person-to-person altruism, and morality.

Conformism may lead to altruism, defined as making sacrifices for others, but it is in fact part of self-interest: one conforms to demands for altruism on pain of being punished by exclusion, which, depending on circumstances of dependency, may jeopardize survival. This may be part of an instinct towards altruism. This is related to reputation as a social mechanism that I recognized as part of self-interest.

I proposed that altruism may be based on morality, outside particular relationships, or on feelings of empathy or identification between persons, within specific relationships. It may also carry intrinsic emotional value, in ‘feeling good to do good’. It forms a basis for acts of consolation, protection, help or support.

Person-to-person benevolence is to a large extent instinctive, varying between people, depending on their genetic inheritance, upbringing, and life path. It is aided by a potential for empathy, in the brain, embodied in ‘mirror neurons’. We simulate in our selves what other people are seen to do and to suffer. As a mother moves a spoonful of food to the baby’s mouth, she opens her own. We feel the pain we observe in others.    

Morality is public, collective. Based on some underlying ethical values it is a generalized set of goals or guidelines shared in some group. It is less automatic, non-instinctive, and it is based on reason, culture, or religion, or some combination of them.

These factors underlying altruism may be in conflict but they may also support each other.

In their analysis of motives for pro-environment conduct, Linda Steg et al.[i], proposed three possible motives for conduct: hedonic (pleasure), gain-oriented (self-interest) and moral. Pleasure and gain may mostly go against pro-environmental conduct, avoiding its efforts and sacrifices, but may also support moral considerations. There may be intrinsic value in the pleasure of ‘doing good’, and it may yield status and reputational gains to be seen to do good. Making sacrifices may also signal wealth as enabling one to make sacrifices.

These effects depend on situational factors, such as seeing others comply or not with pro-environmental behaviour. Here conformism also kicks in. 

Similarly, hedonism and self-interest may go against the morality of altruism, but morality may also be supported by intrinsic value (pleasure), and social status and reputation (gain).

However, one still has to deal with the parochial nature of altruism, with a bias towards in-group others and against outsiders, discussed in preceding items of this blog.

Of course, much also depends on what kind of ethics underlies morality. Earlier in this blog I discussed the three main ethical systems: Utilitarian (going back to Bentham and J.S. Mill), duty-oriented (going back to Kant), and virtue-based (going back to Aristotle). Of these three, virtue ethics is the most pluralistic, allowing for different dimensions, of utility, survival and self-interest, pleasure and duties.

I propose that to engage in a consideration of possible mutual reinforcement of self-interest, pleasure and morality one needs to adopt a multi-dimensional virtue ethics. That is no small step as long as economic considerations are dominant, with economics firmly based on utilitarian ethics.

] Linda Steg, Jan Willem Bolderdijk, Kees Keijzer, and Goda Perlaviciute, An integrated framework for encouraging pro-environmental behaviour: The role of values, situational factors and goals, Journal of environmental psychology, 38(2014), p. 104-115.

Monday, June 5, 2017

318. Escape from routine: how does it work?

Routines, where you operate automatically, unconsciously, are useful. They enable you to think about other things while conducting daily activities. Like talking to someone while driving a car. But the danger is then that you fail to pay attention when conditions escape from the routine, and attention is required. Then something must shock you into awareness, to take remedial action. How does this work?

One explanation is that of the decision heuristic of ‘availability’: you pay attention to what is emotionally loaded, such as danger, or opportunity. That can be irrational, in neglect of things that are important but emotionally less salient, but it does serve to catapult you into awareness of danger.  

I hve argued before that while decision heuristics are generally considered to be ‘irrational’, there may well be conditions where they helped to survive under the pressures of selection, in evolution. This may be such a case. Immediate attention under imminent danger overrides prudence.    

How does that work in the brain? I recently read about an answer from the philosopher Metzinger, as follows.[i] The chance of our becoming aware of the goings on in our brain increases to the extent that neurons fire simultaneously which usually do not. Routines are regular patterns of simultaneous firing. Irregularity, outside a routine, triggers awareness.  

But awareness is not yet attention. So, the two ideas may be complementary. First, unusual connections trigger awareness, and the extent to which they are emotionally laden triggers attention.

Does escape from routine arise only then, in danger or opportunity? In creativity, unusual connections arise not from an outside shock, but from within, seemingly autonomously, and surprisingly. It pops up. ‘Eureka’, the inventor cries. One then is aware, but it springs from serendipity, unforced. But it occurs to the prepared mind, previously stocked with knowledge painstakingly collected and mastered. It is an example of how conscious thought can feed unconscious choice or decision. 

How about dreams? There, the craziest connections occur, violating all logic and ontology.  However, during the dream, chaotic as it is, there is some sense of self. When awake, consciousness filters unusual connections, and in that sense routine, established cognition is still in place outside dreaming.

How about the higher awareness that mystics and meditation adepts claim? Apparently they make connections that transcend the self, and customary logic and categorization, to connect with a cosmic whole. This has been studied, with the help of brain imaging, and indeed, during the height of meditative trance there is an unusually large area of simultaneous firing in the brain.

How about simultaneous firing in different brains? That is being studied in brain science as well, and it seems to be possible to achieve, with much concentration and training. People focusing on a joint task activate similar brain regions.   

[i] Thomas Metzinger, The ego tunnel; The science of the mind and the myth of the self, 2009, New York: Basic Books.