[From Rick Marken (2011.04.02.1510)]
RM: That’s what modeling and experimentation is for. In order to see
whether or not an idea is or is not compatible with data the idea
should first be expressed in the form of a model – equation or
computer program – and then tested against experimental data. The
Austrian school has no model and no tests so it’s just a lot of
blather as far as I’m concerned. It may be blather that sounds similar
to PCT but its actual similarity to PCT can’t be determined until it
is expressed in the form of a model.
Actually, that’s what I find weird about A.S. All theory is verbal, and somehow
experiments can’t be conducted to test the theory because axioms are
self-evident. They are wrong about that, but than again, it might be because
they haven’t found a good model. Most statistical models are good for nothing.
When they hear “model” they hear “good for nothing”.
RM: My experience is that people who come to PCT because it seems
similar to some other theory that the like are the people who are
least likely to understand PCT. These people are controlling for PCT
being like their theory and if discrepancies become apparent they
either reject PCT or start trying to understand PCT in a way that
makes the discrepancies go away; that is, they misunderstand PCT so
that it fits with the theory they like. It’s called coming to PCT with
an existing agenda.
Doesn’t everyone come to PCT (or at any new theory) with an existing agenda?
We all had our goals and purposes before finding out about PCT. I mean, I found
out about PCT by pure accident. I was googling something about the evolution
of neurons and brains and stumbled upon Gary Czikos’ books. That led me to
lcs.com and reading everything I could get my hands on.
My agenda was finding more about how the brain works, and I have gone trough
a lot of reorganising while reading B:CP.
I think I understand what you’re saying - some people come with a blind faith in their
ideas and either reject all or or misunderstand. Perhaps some are less convinced that
they know the truth. If things make sense, a reasonable person (as I imagine my self to be 
will try to find out more, even if it means letting go of some previously dear ideas.
If ideas are more compatible with PCT it might be easier (but they rarely are).
RM: Isn’t subjective expected utility theory the basis of virtually
all micro-economic theory? Subjectivity is not what’s special about
PCT; what’s special is the idea that behavior is control.
This is the theory I’m referring to: http://en.wikipedia.org/wiki/Subjective_theory_of_value
What is ‘special’ about A.S. is that it recognises this fact. Other theories of value are based on
costs of production or something inherent in the things produced.
The idea that behavior is control can be seen in Hazlitt’s Economics in One Lesson, he compares
people with steam machine governors. It’s far from exact or usable, and the word “control” is not
mentioned. Here it is:
(H. Hazlitt, Economics in One Lesson, page 112 )
Most of us must have noticed the automatic governor on a steam engine. It usually consists of two balls or weights which work by centrifugal force. As the speed of the engine increases, these balls fly away from the rod to which they are attached and so automatically narrow or close off a throttle valve which regulates the intake of steam and thus slows down the engine. If the engine goes too slowly, on the other hand, the balls drop, widen the throttle valve, and increase the engines speed. Thus every departure from the desired speed itself sets in motion the forces that tend to correct that departure.
It is precisely in this way that the relative supply of thousands of different commodities is regulated under the system of competitive private enterprise. When people want more of a commodity, their competitive bidding raises its price. This increases the profits of the producers who make that product. This stimulates them to increase their production. It leads others to stop making some of the products they previously made, and turn to making the product that offers them the better return. But this increases the supply of that commodity at the same time that it reduces the supply of some other commodities. The price of that product therefore falls in relation to the price of other products, and the stimulus to the relative increase in its production disappears.
In the same way, if the demand falls off for some product, its price and the profit in making it go lower, and its production declines.
RM: A lot of people (Dewey, Mead, McDougal, Tolman, Weiner, to name a
few) have seemed like they were on the “right track”; but none of them
got to PCT. Powers did get there so I think we can now forget about
the losers;-)
I agree. It’s not about Dewey, Hazlitt or the others.
My problem is trying to talk to people about PCT and having them understand what I’m saying.
To most psychologists (students) I tried talking to, “control” is a bad word, “perceptions”
are pictures in the mind’s eye and “feedback” is when someone tells you how good you
performed.
If I want a person to understand me, and if he or she knows something remotely compatible
to PCT, I could use that and say: look, it’s similar in this and that, and what’s new is this and this.
RM: Do you think the US is unique in requiring that people pay taxes,
attend school and not use drugs? You said the US system was
particularly bad. Do you live in a place or know of a place where
people can just do whatever the heck they want? And do you really
think people function better in such a system? It seems to me that
people function better in a place like Norway, where they have to pay
high taxes and go to school and not take drugs, than in a place like
Somalia, where everyone can pretty much do as they like.
I don’t think US system is particularly bad. Croatia is much worse.
I don’t want to live in a place where people could do what ever the heck they
want, but I would like to live somewhere where it’s OK to do whatever you want
as long as you don’t hurt other people. And if you hurt someone, you don’t go
to jail, but come to an agreement, resolve conflict and repay them somehow.
I sure wouldn’t want to live in Somalia. Somalia is still suffering from
consequences of wars and a totalitarian regime. There seem to be some
improvements since the onset of anarchy, but it’s still too early to tell what
will become of it.
But that is directly contradicted by the facts, at least here in the
US. The less the market was regulated )the more free it became), the
more the greedy took advantage of it. Do you know what happened here
in the US in 2008, after 8 years of freeing up the market? Do you know
that we are still in a major recession thanks to the free marketeers?
Verbal-logical models of the free market austrians provide do seem to fit
the data.
Really? I suppose that’s true; you can do a lot of gymnastics with
verbal models.
Well, I understand there are a lot of theories of why and how the recession came.
There are also more definitions of a “free market”. Some authors compare current
US economy to socialist economies because of all the regulations.
As an illustration of the amount of regulation, there is a list of all the government
departments: http://www.usa.gov/Agencies/Federal/All_Agencies/index.shtml
If the A.S says that taxes are recessionary (higher taxes lead to
lower growth and higher unemployment) then this is contradicted by the
data. In fact higher taxes (higher top marginal rates) are associated
with higher growth and lower unemployment.
There is a correlation. That doesn’t have to mean unemployment
was caused by lower or higher taxes, right?
If the A.S. says that the economy does better with less regulation
than with more, then they are wrong again; in the US, the economy has
always done better (in terms of growth, employment, etc) when the
government was controlled by the “high regulation” Democrats as
opposed to the “low regulation” Republicans. This has been true since
the turn of the century – the prior century, 1900.
I didn’t know this.
If A.S. is wrong about regulation that would have to mean that their logic is flawed.
But I can’t see the flaws.
Best,
Adam
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On Sun, Apr 3, 2011 at 12:10 AM, Richard Marken rsmarken@gmail.com wrote:
