While reading about the Marijuana debate in the last several days, I am overwhelmed by the need for a discussion about complexity in science. First this leads me to question which sciences are relatively complex and which ones are pretty straight forward. I resolve to advocate for more appreciation of the role human involvement in a field plays in introducing complexity.

We, in academia, generally think of something as complex when it is difficult to acquire the technical skill to compete at the highest level in the field. This generally explains why physics is called the queen of the sciences. To learn mathematical skills you have to have talent, hard work, and the fortune to have both good teachers and the circumstances to avail yourself of them. I would argue that the truth is the opposite of this instinct, that social science is much more complex. Social science is something that people can learn though reading, and everyone thinks they are an expert. If you don't believe me, try studying politics and then go out in public and debate people on the street -- their ignorance of the literature will likely not stop them from dismissing the nuanced model you are trying to present.

It is important to consider how error is identified. For me the natural and social sciences differ in how they deal with error. Take engineering for example, error is identified rather quickly, in what I would call a "tight" feedback loop. In the social science, by contrast, error is in a loose feedback loop (and in fact many times error can be dismissed completely as resulting from flawed measurement). Economics has taken the position as "queen of the social sciences" though its ability to mathematize its subject and apply statistical tools. The noble pursuit is to isolate single variable analysis, the practice is to isolate the subject from the social world it seeks to study.

If engineering did similarly detached itself from reality, bridges would start collapsing. During a recent visit to NYC, I am overwhelmed that buildings constructed the better part of a century ago can be so solid. How did they build the Empire State building in 16 months without a clear science of engineering? Can we really claim that we have such a social science?

The best skyscrapers of social science, by contrast, seem to only stand a few levels high. I attribute this to poor feedback loops in the disciplines, but it is also a function of the diversity of preferences that are at hand. There is no difficulty in understanding the difference between a bridge and a skyscraper. These are different arrangements of the same materials (concrete and steel). In fact, we can understand the different appearance of the old world trade center and the new quite easily -- but how do these different structures manifest? In some way it is simply fashion. In some ways it is determined by the person or group in charge at the time the plans are selected. But none of these are engineering questions - they simplify no further than a discussion of preferences. That is the realm of the social sciences.  

But, we are not content simply to reduce everything to different preferences. Policy is set in order to get coherence on particular topics. There are two articles on marijuana that have been circulating recently. The first was on treatment options that the marijuana derived CBD gives for families suffering with child seizures. Another article talked about the misinformation in the public health debate, a famous doctor changes his mind.

Rather than see these instances the exception, I see them more as the rule. Anything that involves human beings is going to have a degree of complexity, and this includes medicine. Marijuana will work for some folks. I would still defend their prerogative to try it even if the link could not be established in the medical literature. This is what it means to acknowledge complexity in social science, and there are always cases where the one-size-fits-all approach is insufficient for political economy. The history of why marijuana became illegal is interesting, but it is an example of the all-too-common phenomena of folks misunderstanding the nature of scientific discovery and too quickly trusting the scientific consensus.

The less things are like skyscrapers, the more important it is to consider complexity.

Reactions to the Reactions: Nudging

Most people blur the lines between nudging, education, and media reporting. 

Proposed clarification: I argue that nudging is specifically changing formal institutional constraints to have a measurable impact on a particular outcome.  

By far the biggest criticism of the news story on "nudges" yesterday (where I was quoted) is that media is like a nudge as well. Sunstein and Thaler do little to create a distinction in their book.

"A nudge, as we will use the term, is any aspect of the choice architecture that alters people's behavior in a predictable way without forbidding any options or significantly changing their economic incentives. To count as a mere nudge, the intervention must be easy and cheap to avoid. Nudges are not mandates. Putting the fruit at eye level counts as a nudge. Banning junk food does not. [paragraph break] Many of the policies we recommend can and have been implemented by the private sector (with or without a nudge from the government." (P. 6)

There is a big difference between behavioral economics as descriptive science and its use as a prescriptive science. To jump too quickly between gathering information and recommending a course of action is to lose what John Neville Keynes called the "art of economics."

In research with Adam Hoffer and Bill Shughart, we suggest that a combination of choice and education is preferred to nudges, selective taxation, and prohibition. Some people want to call this a nudge as well, but there is a major distinction between educating the public and changing the institutional constraints that they face. Consider an example that Sunstein and Thaler make: planning the school lunch line. If you put french fries first, students fill their plate with them. If you put salad first, students fill their plate with that. A nudge policy would be to recognize this behavioral description and use it to achieve your normative aims. In this case, education is all that is needed. Telling the folks that arrange school lunches of this simple fact, ought to change the way the lunch line is laid out. We assume two things here in leaving this as a descriptive policy:

1. that the school officials care about the nutrition of their children; and 
2. that they think salad is more nutritious than are french fries. 

This is simple. A descriptive approach to the world provides insight into the way people work and allows the decision makers to act on the additional information. Having recently become a father, I can tell you that information about what to do is not a scarce good. It is sorting and using the information that is hard. We had a conversation with the director of the daycare where our daughter attends yesterday about the transition to formula. Given competing hypotheses the advice was to go with what suits you the best. There is no scientific consensus, nor can their be any on these matters. Can child care be really all that different from behavioral science in general (after all the term paternalism is derivative of this, right)?

When considering parenting or considering policy, there are benefits from each method (The costs are the foregone benefits of the alternative choice). The decision a person makes gives us insight into their preferences (who they are as a individual). This assumes quite a bit of rationality (of the Herbert Simon variety). I think that we need to take this seriously as we recover from the attack rationality has taken since the great recession. Of course, any rationality that assumes perfect information at low cost is bunk. But, that does not mean that people do not behave rational given their available information. Bryan Caplan has even started the discussion on behaving rational by failing to undermine your easily controverted beliefs. He calls this "rational irrationality."

First we must take education seriously. To understand the way that people process information, we have to understand more about education. The classic article on this is the one by Stigler and Becker, De Gustibus non et Disputandum. In the article we find that preferences are formed, so education matters.

The critique of nudging also assumed that media was nudge. This is a much more interesting argument. There is no classic paper, but I think Caplan's work is a way into this. People are drawn to groups with consensus opinions. Political decision making undermines the personal cost associated with holding irrational beliefs because your vote does not change the outcome of the election. The relevant cost of truth seeking is being socially admonished by holding an unpopular (but true) belief. The fastidiousness of genuine truth seeking is enough to make people rationally reject truth in favor of a fiction that allows for more friends. Media can help support this pathology, especially when media is politicized like it currently is in the US. With Viacom and NBC on one side and FOX on the other, the political divide creates clusters of consensus and not truth seekers. All of this is worthy of concern, but is not nudging the way I understand it.

If we are going to distinguish nudging from media and education, we need to have an operational definition. Douglass North uses Herbert Simon specifically in forming his notion of bounded rationality. Let's take this for granted and say that nudges are derivative of both of these ideas, institutions and bounded rationality. To operationalize the notion of nudging, therefore, it must have more to do with formal institutional change than informal (North's distinction). Nudging also takes for granted a type of rationality of the actor, and I see that as bounded rationality. Finally, the thing about making nudges a government policy is that it has to deliver measurable results to be warranted through utilitarian calculus (however flawed).

So, after this analysis, I end up with my definition:  Nudging is specifically changing formal institutional constraints to have a measurable impact on a particular outcome.

Prompted Thoughts on Nudges: An Interview

My general approach to topics like these is emphasize that the issue is one of choice. My discipline, economics can be reduced to the study of choice amidst scarcity. So, behavioral economics is a wonderful addition to the description of the way choice takes place. What I find to be an important issue when folks begin applying the insights of behavioral economics is the idea of unintended consequences. 
Let me start with two illustrative examples of the problems surrounding opt-out. I immediately think of two programs, one is the organ donor program sponsored through the DMV.  The incredible ease with which this program has made it possible to opt-in to organ donation still contrasts with the number of people claiming to want to be organ donors. One way to interpret this information, behaviorally, is that find it uncomfortable to think about organ donation and simply ignore it. This would in-fact explain why so many more people claim to want to donate organs than those who check the box on the driver's licence application. There might be another explanation, however, that people are more likely to say that they want to be organ donors than actually do. Economists call this "cheap talk," meaning that it signals good intentions without causing any consequence for the speaker. 
We know that we would get more people to donate organs if we made the system an opt-out one. In the presence of drastic organ shortages, this is an overwhelming argument in favor of switching to opt-out.  However, let me discuss one unintended consequence. Do we really think that the opt-out option would be on the DMV form? If the policy is really to recruit more organ donors, what about those people who object religiously or philosophically?  How easy will it be to opt-out given that the people who want to opt-out are a non-vocal minority whose default rights have been switched?  
This brings me to my second example. In Germany, where my wife is from, her brother-in-law had to opt-out of the taxes he paid to the Catholic church. As he was not religious and found this offensive, he researched the method one can use to opt-out. Fortunately for him, in Germany, the atheists are not in the minority and opting-out has gotten easier over time as the number of people wanting to do so has increased, but the point is that he has to invest real resources in finding the correct form and office to contact to remove himself permanently from the roles of the Catholic church. Many people in Germany simply never get around to doing this. 
Now this was a long digression to answer your question about the porn filters article from the BBC article. Setting the default status to opt-out means that those people with the desire to view porn have to be vocal about their desire to do so. This is likely not to be easy. By contrast, opting-in is easy. I am a parent and I know quite a bit about parental filters. There is a large community that shares this information, where I am from in Utah you can even buy DVD players that screen objectionable material from many popular DVDs. This is called "clear play." The dynamics of this are simple, the market provides the service because quite a few people share a principled objection to pornography, they are the majority, and the market does a good job of providing items that accommodate the majority's preferences.  I worry that the minority will not be vocal and will have very little ability to create work around solutions.  If this is desirable, why not prohibit the porn industry entirely? 
This gets me to my general thoughts on nudges.  Nudges are less likely to cause unintended consequences than disfavored taxes (we discuss "Sin Taxes" in a Mercatus paper) and these are preferred to prohibitions that cause serious problems with black markets and the attendant crime (drugs, alcohol). Giving the consumer free choice is most preferred. Choice > Nudging > Sin Taxes > Prohibition. 
In this case choice means education about the benefits of things like organ donation and the harms of things like ponography. Nudging seems to be a way to have paternalism dressed up as not interfering with choice. I hope I have made the case that libertarian paternalism is a contradiction in terms because libertarians like choice and paternalists think people make systematic errors. 
It is hard to argue against the notion that people should pay their tax bills on time. I will say that one of my specialties is Public Choice economics which indicates that making government more efficient is not always a good thing. In fact, improvement in efficiency is only good when the government in question is both omniscient and benevolent, a condition that rarely holds. At the end of the day, many of the reasons that nudging might work is because it silences implicit arguments that people are not prepared to make explicit. I tend to think of this as a type of bullying by the majority. There may be more reasons that people pay taxes late, fail to complete schooling, save less than they "should" for retirement, and other policy goals than are readily accounted for in this literature. I think the attic cleaning service (mentioned in this article) is an example where good marketers can apply their trade and try to educate the public.  However, as a matter of policy, if it doesn't make sense as a prohibition or absolute mandate, we need to seriously consider why we think it makes sense as a nudge.

This last bit formed the basis of quotes in several news outlets:  here, here, here (Maxim Lott, The actual interviewer).

I am very skeptical of a team promoting nudge policies. Nudging, just like taxing and prohibition, has unintended consequences.  I don't believe it is "worth the cost."  I am not convinced that increased efficiency in government is always a good thing (especially in the case where government ignores unintended consequences or the intervention is simply in error). Ultimately nudging is still paternalism, which assumes a small group of people know better about choices than the individuals making them. For example, trans-fats were considered better than saturated and unsaturated fats in the past, now we know this is an error. Certainly, nudging has the potential to go too far. I am a much bigger fan of the idea of education and choice than I am of engineering choice. The individual has a capacity to adapt and learn. Taking individual choice seriously is better policy than assuming government knows better. 

A Proposal for the Sciences, Rediscover Bacon's Idols of the Mind

Why is science so stubbornly politicized?  Perhaps we have just been teaching it wrong.

Francis Bacon benefited from his Queen's loyalty to the split with the Catholic church. Being entirely separate had its advantages, and Bacon's firm adherence to Aristotle while despising the state of received Aristotelian philosophy materialized in his bold new vision for the scientific approach.

I am happy to discuss in comments the details of this matter, which I am still working through, but let's make a long story short. Science before Bacon had been captured by the idea of the deductive method. This means that first principles were hypothesized which, when logically applied, would sort out almost any contradiction between competing claims. What if these didn't work because of some new discovery? Simply, revise the first principles. This process would give us insight into the true nature of the world.

Bacon offered an alternative. His method looked towards the inductive method. This takes a radical approach to science that we are all taught in our first laboratory class, the scientific method. Simply put, the scientific method asks us which phenomenon we are interested in and then accumulates related observations. We sort these observations by their perceived priority in association with the main phenomenon of interest.

In this approach, Bacon discovered what he called the Idols of the Mind. He gave them names:

• idola tribus: The idol of the "tribe" deals with coherence of ideas into neat packages. I take this to be related to much of the moral foundations literature Jonathan Haidt is working with. 
• idola spectus: The idol of the "cave" deals with cognitive bias. For example, our minds interpret our enemies best argument as evidence that they have bad intentions. Liberals who watch Fox News confirm their prior that conservatives are crazy. 
• idola fori: The idol of the "marketplace"  deals with language. Often language assumes a meaning quite different the way specialist use it, this helps distort careful logic when applied to the public debate.
• idola theatri: The idol of the "theatre" is the closes to sophistry. The tendency to over-sell academic expertise. 
• idola schola: The idol of the "school" is the pedantic reasoning of textbooks. It is a oversimplification useful only for the teaching of material to neophytes. 

The idols were categories of errors. Science according to Bacon was understanding error, not finding truth.  The most important lesson that Bacon teaches us is that all answers are errors and that these are more or less affected by these idols. To begin the process of cleansing the mind from these idols, there are many approaches. None are going to work. We can only progress by taking the task seriously. 

I find it discouraging sometimes that so many students think that they can posses "the answer" and have simply not been taught the idols of the mind, specifically idola schola. I can't read a periodical without thinking of the idola fori. I have so much contempt for my peers who dismiss the idola theatri and attempt to establish their reputation by sophism. 

The only hope science has is to proceed with a more ready understanding of Bacon's idols. It strikes me that much of what we see as progress in the last 300 years depends on the implicit expectation of this task. If anything explains why modern science is so politicized, it is the fact that we have lost our understanding of Bacon's method. I aim to do better.    

Irrelevance of Statistical Averages to Perceived Bias

Helen Thomas recently died and she is rightly remembered as a "pioneer." What Helen Thomas did was truly amazing as she not only put together a career as the first woman to do what she did, but she also raised the bar in her profession and blew past the bar of simply proving that women can do the same job as men. She proved they she could do it better than most.

It would be tempting to compare her to Jackie Robinson, another trailblazer who was memorialized in film this year. However, not all bias is created equal, so I want to push away from false equivalence. Too quickly latching onto a narrative of the pioneer seems to do a subtle and mischievous disservice.

We can look at statistical averages to measure discrimination in our world, today, which remains despite the efforts of people who have "broken through the X barrier." The world is a vastly unequal place, even today. However, one simple point must be emphasized. That as much as the statistical averages differ, they tell us nothing about the capabilities of each demographic category. Statistical averages are silent on the vast array of things that we all want to talk about.

President Obama for the first time as a sitting president explained what it felt like to be subjected to discrimination. But, his last word on the subject is that his daughters are just different. He says that the younger generation is just better than us. This is likely true. In the last 50 years, a whole career for people like Helen Thomas, the world has changed. No one takes it for granted that race, creed, or sex will prohibit you from doing things that you want to do. Despite this fact, however, the legacy is an inescapable feature of the debate.

There should be no journalist that doesn't know who Helen Thomas was. There should be no diminishing of the achievements of folks who overcame similar obstacles, but the fight for equality does not end with women both being equal and women continuing to feel the lingering victimization. When Obama talks about what he has seen, personally, as discrimination he must walk away from this experience and retire to a private place in the White House to consider the precedent that he is setting. In a world where young black men feel completely alienated, the White House can no longer be a joke as an aspiration.

This brings us back to stats 101. The statistical difference between races is dwarfed by magnitude of difference within one race. We are different on average, but this no longer correlates with a glass ceiling for achievement within any one category. While history cannot be forgotten, those that have succeeded and become path-breakers have rejected the notion that the statistical differences between categories must matter for their potential. Perhaps one might take heart in breaking down a barrier that still remains. Perhaps a person will remember to help others who follow behind themselves because of the recognition of the achievement. The true measure, however, of progress is simply getting beyond the narrative of statistical averages and work on making that data irrelevant by setting a new example.

Is Leviticus being Revived for a new Audience?

Everyone disagrees with Leviticus. Some because its moral strictures seem absurd, <insert example here>. Others, with a more complex perspective, due to their adherence to the tradition in which Leviticus plays a notable role, at least see the material in Leviticus as horribly outdated or somehow flawed. I would argue that this confusion is endemic to the field of "priestly writing."

One of the things that I have learned from working on "sin taxes" is that the priestly culture is still alive an well with us today. I am making a synthesis between priestly culture here and work by Peart and Levy on experts. (see a policy related application here or their scholarly work here). My basic model for thinking about this is a theory of hierarchy. Sin taxes build on the idea that people do not know how to choose for themselves. Much work has been done in psychology that supports the thesis, e.g. hyperbolic discounting. When it comes to the future, people discount the future heavily.

But what this allows are the same kinds of claims made by the priestly writers of Leviticus. For them both the reconciliation of the person to God as well as the reconciliation of the people of Israel to God were important aspects of founding the religion. The purity of culture that is at the end of both approaches to perfecting society is cut from the same cloth. While I certainly think that a priestly attitude is great for some, the disadvantages should be obvious. These can be summarized in two broad categories, degradation of self and degradation of the other.

Degradation of the self comes from thinking that one's own impulses are corrupt. What we learn from the behavioral literature is that people seem indifferent to their future selves. If we accept the findings of hyperbolic discounting, then we consider most actions people take towards self-indulgence to be irrational. But this faces a problem that has plagued economics since Bentham. There is no way to count the utils stimulated through irrational behavior. In fact, Bryan Caplan has suggested that irrational behavior itself generates utility. Even from a religious perspective coming to terms with man's fallen nature is important. The lesson is to recognize the process of perfection, not the achievement of it. What comes from trying to be perfect is the necessary disappointment of limited ability to do so. Here is where the state steps in. Since you want to change your behavior but lack the will, you will be protected from yourself through prohibitions, disfavored taxes, and administrative hoops forged in the name of libertarian paternalism. These administratively delivered self-denials are certainly part of the tool kit of reform, but why the one-size-fits-all approach?

Degradation of the other stems from this same process but calls on many more animal instincts. The tribal pull to want to extend our preferences to others helps to explain how our diets, our smoking choices, our retirement choices, and our sexual mores all become part of the public debate. What was good for us in reaching our own goals must be good for others, right? The problem is that with so many competing priorities for improvement, how do we narrow it down to a few categories? The economist wants to know how the marginal dollar is spent on improving behavior. Where should the emphasis be placed?

Inevitably the emphasis gets placed by those with the most voice. In a society where the priests have the most voice, the outcome looks like Leviticus.  In a society of politicians, how different is it? Our desire to think of our government as the rational embodiment of perfection is not all that different than the writers of Leviticus.  The groups may change over time, but I feel certain that in 3000 years our desire to perfect this society according to the moral dictates of the current group will be seen with equal reproach and disgust as their analogues in ancient history.  

Cosmo-Parochialism

I hate when people say they like to travel, for most people mean that they like consuming museums after taking a long plane flight.

As a professor, I have been to my share of museums during my opportunities to travel. I recall taking a group of students to Manchu Picchu. They couldn't really care less. Sure, there is a part of them which will look back on the group pictures that we made, or remember what it was like to stare down from the sides of the mountain to the river vanishing in the valley below, but really what they wanted were the props for visiting. The gift shop at Manchu Picchu gives a stamp for your passport, which is symbolic. It is just another item on the list.

Real travelling requires learning a language and staying in the homes of the people who are native to the country. Far fewer people do this. I wouldn't even know about this if I didn't do a study abroad where I lived in someone's house or if my wife's family were not so generous as to put us up when we visit Germany. I can't help but fret when I think of  too many of today's students that can't tell the difference between 1) wandering the streets of a foreign city and 2) actually becoming acquainted with a foreign culture. 

I find this to also be the case among so many people's political preferences as well. The cosmo-parochialists have a list of things that they have to have to consider themselves cosmopolitan. This list includes having a gay friend, traveling abroad, volunteering for a political campaign, and various other things. We all know the list of things we are "supposed to" do before we get old and set in our ways. But none of this is real because it lacks a fundamental element of reciprocity. This reciprocity requires submitting one's self to challenges to one's beliefs. 

The cosmo-parohialist consumes culture, s/he does not experience it. Living life with a check list of politically correct experiences does not get you down and dirty in another culture. It doesn't let you experience things that repulse you about other cultures that you learn to appreciate when you see it with a new set of eyes. One can have these experiences without leaving home. All that is needed is someone who is unrepentantly different than you. This comes from an openness of mind that demands engagement with others. Few have this trait, rather they quickly converge on the "right" answer. True cosmopolitans, rather, are stuck not knowing which hand to hold a fork or whether to use chop-sticks because they love both traditions so much it is hard to chose one. 

A cosmopolitan wants everyone else to remain different so that they can benefit from different customs and traditions, so that they can experience cultural exchange and learn new things. A cosmopolitan fears the convergence of cultures brought about by globalization because they will lose the very thing that defines them as cosmopolitans, a challenge to their own sacred beliefs. 

A cosmo-parochialist cannot get this while listening to an English language translation of a museum tour.