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People Aren’t Dumb, the World Is Hard

freakonomics.com

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Re: People Aren’t Dumb, the World Is Hard

#191

Post by kungtotte »

pm90 wrote: post #162
rvern wrote: post #135

Earlier quoted context omitted.

No, this is one of the greatest arguments for small government or no government. People are more rational when the cost to them of being irrational is larger. Voting for good policies is a public good. When a voter is one among three hundred millions of citizens, only 1/300,000,000 (on average) of the benefits of the vote befall the individual voter. This gigantic externality means that the democratic market will sev…

On commenting on an article about why people have difficulty comprehending complex systems, you have just delivered an example of the phenomena. Your basic point seems to be that a big Government will be so well run that individuals would rely on it to provide them with benefits, even in the case that the Government make poor decisions on policy choices. That is the whole point of a Government: to make life easier fo…

It's also a regulatory body to ensure that certain functions and services are provided equally to every citizen. E.g. everyone has the same basic human right of access to health care and education for example. Who else should guarantee that access for a whole population if not the government?

Re: People Aren’t Dumb, the World Is Hard

#192

Post by Symmetry »

gdubs wrote: post #95

Reminded of this timeless Carl Sagan quote: "We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology."

Our civilization has attained its complexity by encompassing such knowledge that it would take a million lifetimes to learn all of it. I have made my career learning about technology and learning about science is a great hobby of mine. But I have only the dimmest understanding of even how much there is to know.

Re: People Aren’t Dumb, the World Is Hard

#193

Post by mattbrewsbytes »

RickS wrote: post #153
mattbrewsbytes wrote: post #134

An interesting bit from the article was that he talks about 'sunk cost' with the defining example of ordering a dessert when you're nearly full and feeling compelled to finish it. > There was an economist once early in my career who said to me, “You know, if you’re right, what am I supposed to do? What I know how to do is solve optimization problems.” A career economist not wanting to change their ways because they h…

My understanding with Kodak is that they invented digital tech far earlier than expected (pre 80s) and hushed it to avoid cannibalizing their existing film business. I suspect Blockbuster behaved similarly. It's hard to kill the golden goose. Still examples of the sunk cost fallacy, for sure, but it feels like "lack of realization" is perhaps the wrong attribution.

In a way, it is sunk cost all the way down. Those companies' entire existance - supply chain, manufacturing, down to identity of what they do was so etched into everything it was hard to change.

Re: People Aren’t Dumb, the World Is Hard

#194

Post by realitygrill »

dqpb wrote: post #133
ppeetteerr wrote: post #126

Earlier quoted context omitted.

Economists rarely have a good solution to societal problems. They have good solutions for facilitating trade but offer nothing with respect to social norms, nationalistic sentiment, etc. We all agree that economists are good at maximizing resource allocation. Sysops are good at maximizing hardware allocation but we should let them dictate national policy :) Politics is about taking all of the science and all of the h…

I disagree that economists are good at maximizing resource allocation as they largely ignore externalities.

but economists invented the term "externalities" and the analysis of such..

Re: People Aren’t Dumb, the World Is Hard

#195

Post by Symmetry »

ucaetano wrote: post #156
rvern wrote: post #135

Earlier quoted context omitted.

No, this is one of the greatest arguments for small government or no government. People are more rational when the cost to them of being irrational is larger. Voting for good policies is a public good. When a voter is one among three hundred millions of citizens, only 1/300,000,000 (on average) of the benefits of the vote befall the individual voter. This gigantic externality means that the democratic market will sev…

> People are more rational when the cost to them of being irrational is larger. This isn't strictly true, and I'd love to see you provide extensive data on such a exceptional claim. There is a lot of evidence showing that harsher punitive measures often have little to no impact on crime and wrongdoing.

I think the general consensus is that the ineffectiveness of long sentences is mostly about hyperbolic discounting. Hawaii has recently had a lot of success with a program providing small, immediate penalties to people who break their parole conditions. This seems to work far better than large penalties that will only be applied after a large number of offences.

Re: People Aren’t Dumb, the World Is Hard

#196

Post by jonsen »

asdffdsa321 wrote: post #143
skadamat wrote: post #80

I would really really encourage everyone here to watch Alan Kay's recent talks on how poorly we understand systems and why it's critical we get better at managing them. Some good ones: - https://www.youtube.com/watch?v=R1R2jH4PQEo - https://www.youtube.com/watch?v=N9c7_8Gp7gI Some people have strong opinions about Alan Kay's CS / programming work and I'd really encourage them to put them aside and deeply understand h…

But can he solve a whiteboard coding question in 30 minutes?

He will get away with small talk.

Re: People Aren’t Dumb, the World Is Hard

#197

Post by ppeetteerr »

StanislavPetrov wrote: post #169
ppeetteerr wrote: post #34

This is probably the greatest argument for big government. If we were to eliminate the supervision of the establishment over the safety and security of everyday life, it would be very time consuming to handle every single aspect of it. There is always the issue of an overreaching government, and that's where the left/right party split comes in. Each party either creates more regulation and protection or take some awa…

>it would be very time consuming to handle every single aspect of it. Life is complicated. It is time consuming to become an knowledgeable, aware person capable of contributing intelligently to society. It is also absolutely necessary if we want to have a self-governed society worth living in. You can't have a worthwhile government - let alone a big government - governed by the will of the masses when the masses are…

That is where domain experts come in. It would be impossible for me, as an individual, to understand the repercussions of tax credits on the solar energy industry. I vote instead for competent people who I believe are best positioned to find the right people to answer these questions on my behalf.

Re: People Aren’t Dumb, the World Is Hard

#198

Post by ppeetteerr »

hutzlibu wrote: post #176

I admit I only skimmed the article, but I still throw in a potential controversal counterthought (even though I don't disagree with the article from what I read): People* are dumb. Why? They have been breed like that for many generations. Because all the classic Civilisations and Empires needed lots of dumb workers and peasants who were able to do their simple work, but not smart enough, to organize any opposition ag…

>* with "people" I mean the average person in the street, the one from the famous Churchill quote

Most people are dumb about most things, good at a small number of things, and excel in one to three things.

Re: People Aren’t Dumb, the World Is Hard

#199

Post by dredmorbius »

olef_ wrote: post #29
aalleavitch wrote: post #2

We’re dumb in comparison to the systems we’ve created. Increasingly, the disparity between what our technology is capable of and our own limitations as animals will become a pressing issue. One thing that always bothers me is how we have this myth of personal responsibility that supposes an individual is equipped to defend their own interests against a multinational corporation on their own. “Well I just don’t get wh…

Execs of MNCs can be "nudged" too to do the right thing. That finding is one of reasons Thaler deserves his Nobel. Read his book.

MNCs?

Re: People Aren’t Dumb, the World Is Hard

#200

Post by kzrdude »

DesiLurker wrote: post #158
ppeetteerr wrote: post #34

This is probably the greatest argument for big government. If we were to eliminate the supervision of the establishment over the safety and security of everyday life, it would be very time consuming to handle every single aspect of it. There is always the issue of an overreaching government, and that's where the left/right party split comes in. Each party either creates more regulation and protection or take some awa…

My preferred solution for governance problems is basically to have smaller governing units (nations/states/districts). this gives people better representation and is pretty effective in managing the 'tyranny of the majority'. considering the environment in US today the majority is essentially 51%. Now if one considers how bi-polar favorite policies for each side has become, it (mandate) is nowhere near enough to just…

It's a very popular theory that smaller polities have better governance. Picking single examples would maybe not capture it but I'd think of NZ vs Aus, Ireland vs UK, Switzerland vs France, or even Canada vs USA. (All pairs picked to have similar location in the world, but I guess you want to say the (former) empires of USA, France and the UK put them in entirely separate categories..)
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