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Tuesday, December 18, 2007 - 09:41 AM Permanent link for Consequences & Intentions
Consequences & Intentions

One of the classic dividing lines between econ-minded and lay people is that between consequences and intentions.    Econ-folk are generally consequentialists and tend to judge an action by it's real world impacts.  The belief system was perhaps most famously articulated by Adam Smith as -

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.

In other words, we don't care what the Intentions were of the baker;  we should only really about the object he produced.  His reasons (be they benevolent or otherwise) are his, his alone and, strictly speaking, should be independent of whether or not we consume his bread.  In many respects, the whole machinery of capitalism relies on this sort of evaluation of "product" independent from "intentions" as a solution to Hayek's Knowledge Problem;  it would simply be computationally impossible to make / buy / sell complex goods without "market price" as an informational shortcut. 

For better, this mechanism is a large part of how capitalism is able to scale across different cultures and, for that matter, across people who may hate each other.   In fact, this is why so many argue that capitalism is such an effective weapon against racism.   For worse, this mechanism leads to a sort of alienation felt by many that's been the subject of numerous tracts by activists large and small. 

A key insight into the latter was highlighted by Steven Pinker in his prodigous literature on Human Nature.  While markets writ large are products of the last couple thousand years of human civilization, the human brain's "native" social circuitry was formed by evolution over hundreds of thousands of years to assess dominant transaction types that occurred well before.  Consequently, chunks of the brain are 'naturally' hardwired to divine the intentions of the parties involved regardless of the economic impact on the transaction.  By contrast, Econ-brains aren't quite so natural and, like math or science, are more the product of explicit schooling.

Thus, the argument goes, we have one reason why so many folks have deep seated, emotional reservations about capitalism -- a sort of vestigal, cognitive bias leads us to question the baker's Intentions / Motives and Selfishness leaves us feeling uneasy.  Is he really trying to make us great bread?   Or just make a quick buck?   And if he's a giant baking corporation, he's even more faceless and profit-driven.  I'd argue that a good chunk of the work of corporate marketing / branding is, in fact, an attempt to bridge the divide between "what is produced" and "how we assess the producer's intentions".

An interesting article in the NYT dives into a new fad in philosophy - dubbed Experimental Philosophy - and presents an interesting quirk in our Intentions Circuitry .   In addition to "naturally" seeking an intentions basis for market behavior, there's apparently also an assymetry in how rapidly we assess Good vs. Bad intentions -

Suppose the chairman of a company has to decide whether to adopt a new program. It would increase profits and help the environment too. “I don’t care at all about helping the environment,” the chairman says. “I just want to make as much profit as I can. Let’s start the new program.” Would you say that the chairman intended to help the environment?

O.K., same circumstance. Except this time the program would harm the environment. The chairman, who still couldn’t care less about the environment, authorizes the program in order to get those profits. As expected, the bottom line goes up, the environment goes down. Would you say the chairman harmed the environment intentionally?

I don’t know where you ended up, but in one survey, only 23 percent of people said that the chairman in the first situation had intentionally helped the environment. When they had to think about the second situation, though, fully 82 percent thought that the chairman had intentionally harmed the environment. There’s plenty to be said about these interestingly asymmetrical results. But perhaps the most striking thing is this: The study was conducted by a philosopher, as a philosopher, in order to produce a piece of . . . philosophy.

Other commentors like Arnold Kling are skeptical that experimental philosophy will generate useful insights.   I'm more optimistic that, as with other studies into cognitive biases, that understanding the basis of our flaws is a big step towards solving them.


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