From [Marc Abrams (2006.06.23.1643)]
[From Bill Powers (2006.06.23.1412 MDT)]
Marc Abrams (2006.06.23.1553) --
I hope your modeling group can do better than Rothbard does.
Bill, we are not attempting to model an economy. Our pursuit is a great deal less elaborate but much more important. I hope to show that rationality, or from an economic perspective the "expected Utility curve" needs to be rethought in the face of perceptual control.
The notion that people "satisfice", or "optimize" is the foundation not only for economics but for most of the social science's and again, in the face of perceptual control provides a very poor backdrop or understanding of what might seem to be "reasonable or "plausible" behavior.
When you add "bounded" rationality, which simply means that whatever we deem reasonable is always tempered (bounded) by the >environment than you can begin to understand why our understanding of "rationality" needs to be revised.
I believe that pursuing this line of thinking gives me the most direct path to what others deem to be most important to their work and that is in answering the question; "why do folks do what they do?" Well you could say that folks try to be rational. I like to think that understanding that we are controllers and not necessarily "rational" provides a reason for wanting and needing to know perceptual control theory. Forget for a moment what the actual mechanisms are internally that provide this, to me those are not important questions. I know they are to you and I'm not trying to minimize their importance. I just think that I can be more effective working from the top down rather than the bottom up.
What is important is that we are indeed controllers and as such there are certain consequences involved for the organism.
He is trying to analyze the economy by looking at multiple closed-loop
relationships a few at a time,
Bill, I did not present Rothbard's work as a way to model an economy. Indeed I have said a long time ago that modeling an econmy is near impossible and something I would not touch
.>which gives a plausible but entirely spurious picture of how the whole system works.
I think you must try and understand the basis for his thoughts. He did not simply pull this stuff out of a hat. You say spurious. On what basis do you make this claim? What specific aspects did you disagree with?
It's probably beyond the capacities of the unaided human brain to
understand what happens when all the interacting loops are working >at the same time, rather than each one waiting for the others to finish as in Rothbard's analysis. Prices, interest rates, market changes, >consumer preferences, inventory changes, depreciation, wage and dividend adjustments all go on at the same time. Anyone in SD must >know that you can't change just one thing in such a system. Everything changes at once, and only through simulating the system can >we learn what the consequences of any major change will be. Rothbard's "insights" are an unending stream of confident >pronouncements having no basis at all that I can see.
I think your intitial read was done in some haste and I don't for minute think Rothbard does not understand the simultinaity involved or the complexity. You might want to read the book, or better yet If you'd like, I'd provide you with a book better suited to providing you with his understanding of economics rather than his take on a particular issue.
I can understand why you might think the way you do without knowing or understanding why he said what he did.
Regards,
Marc
Bill P.
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