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Economic Theory and Cognitive Science: Microexplanation
In this study, Don Ross explores the relationship of economics to other branches of behavioral science, asking, in the course of his analysis, under what interpretation economics is a sound empirical science. The book explores the relationships between economic theory and the theoretical foundations of related disciplines that are relevant to the day-to-day work of economics--the cognitive and behavioral sciences. It asks whether the increasingly sophisticated techniques of microeconomic analysis have revealed any deep empirical regularities--whether technical improvement represents improvement in any other sense. Casting Daniel Dennett and Kenneth Binmore as its intellectual heroes, the book proposes a comprehensive model of economic theory that, Ross argues, does not supplant, but recovers the core neoclassical insights, and counters the caricaturish conception of neoclassicism so derided by advocates of behavioral or evolutionary economics.
Because he approaches his topic from the viewpoint of the philosophy of science, Ross devotes one chapter to the philosophical theory and terminology on which his argument depends and another to related philosophical issues. Two chapters provide the theoretical background in economics, one covering developments in neoclassical microeconomics and the other treating behavioral and experimental economics and evolutionary game theory. The three chapters at the heart of the argument then apply theses from the philosophy of cognitive science to foundational problems for economic theory. In these chapters, economists will find a genuinely new way of thinking about the implications of cognitive science for economics, and cognitive scientists will find in economic behavior, a new testing site for the explanations of cognitive science.
Because he approaches his topic from the viewpoint of the philosophy of science, Ross devotes one chapter to the philosophical theory and terminology on which his argument depends and another to related philosophical issues. Two chapters provide the theoretical background in economics, one covering developments in neoclassical microeconomics and the other treating behavioral and experimental economics and evolutionary game theory. The three chapters at the heart of the argument then apply theses from the philosophy of cognitive science to foundational problems for economic theory. In these chapters, economists will find a genuinely new way of thinking about the implications of cognitive science for economics, and cognitive scientists will find in economic behavior, a new testing site for the explanations of cognitive science.
- GenresEconomics
444 pages, Paperback
First published June 1, 2005
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June 11, 2009
I was a bit conflicted regarding how to rate this book. On one hand, it has been hugely influential for me and the way I think about science. On the other hand, being hugely influential on an undergrad is so easy it probably wouldn't even be worth an achievement point on Xbox Live. A year and a half ago I would have been hugely influenced by a ham sandwich if someone had written an equation on it with mustard. Secondly, part of why it has had such a big impact on me is the fact that it is about very big, very fascinating issues that are of great interest to me, but which I have not actually read much about outside of... well, this book. The book deals with many topics, but the central question that Don Ross grapples with is that of the self, and what exactly cognitive science, evolution, and microeconomic theory have to say about what it is. Despite knowing non-negligible amounts about each of those topics, my education is mostly restricted to the nitty-gritty stuff you learn as an undergrad and as part of the day-to-day research grind, and I had never seen anyone weave together the big ideas of the disciplines on such a grand scale. However, few of the ideas in the book are entirely new, of course, and someone who was better read in stuff like this would probably be less wowed than I. In conclusion, I think this is a great book, but it's probably less great than I think it is.
But enough about me. I should probably talk about the book a bit, huh? As mentioned before, the book draws on microeconomic theory, evolutionary psychology, and cognitive science to form an argument about how and why we conceptualize the 'self' the way we do. I won't try to summarize his arguments, as that would take a month, but for readers who are scratching their heads right now, I will try to give a taste of how the three disciplines fit together, and why they are converging both in this book and in the broader scientific literature. First, we have economics, which most people think of as being about taxes and interest rates. But it's not! People don't really know what economics is, least of all economists, but Don Ross makes that case that it is really the science of scarcity. That is, there is a finite amount of resources in the world, and an effectively infinite demand for them. What do agents do about it? That, according to Don Ross, is the true domain of economics. This is also what has ended up binding economics -- quite accidentally! -- to evolution and the life sciences. Scarcity, after all, is the fundamental problem of life. If there were an infinite amount of food around, an infinite amount of time for organisms to reproduce and infinite space for them to occupy, then fitness would not matter and there would be no natural selection. But scarcity exists, and thus relative fitness influences which organisms and organic structures end up propagating. And after billions of years of competition we get the human brain, which is the domain of the cognitive sciences. Using over 100 years of ideas and research from each of these fields, Ross investigates what all of these fields tell us about what the human brain is, why it is the way it is, and, most of all, what it means about our intuitive concept of the 'self' that are so deeply ingrained in us yet has no clear scientific meaning.
Which is all well and good, but first you have to figure out what the hell he is talking about. This is very much not a book for the general public, as the profoundly un-catchy title makes clear, but even for those with doctorates in one (or even more!) of the relevant fields, this book is a dense slog at best. It is so laden with unexplained jargon, unnecessary verbiage, and general vagueness that it is impossible to discriminate between the ideas that are confusing because they are complex, because they are under-explained, or because they just make no goddamn sense from the beginning. In one delightfully ironic passage, Ross reprimands his fellow philosophers for not laying out their ideas in real, feasible, grant-worthy experiments (a noble sentiment!), and then proceeds to give the most baffling, incomprehensible experiment proposal that I have ever seen. That shit would have gotten an F as a Psych 101 paper.
This major shortcoming aside, does Ross accomplish his goal? Does he offer anything new and useful to the scientific literature? I think so, but only time and much research will tell whether the ideas in this book prove scientifically useful. He occasionally overreaches and makes some fairly bizarre claims, but given that Ross is a philosopher by training it is surprised he didn't do so more often. Most of what he says is grounded in real, hard science, while at the same time he goes beyond the obvious textbook interpretations of the results to engage with big questions in a way that scientists usually do not. In this way, Ross successfully creates a cohesive, compelling, and empirically-sturdy framework for thinking about the mind and brain.
FYI, anyone interesting in topics should probably check out Daniel Dennett's writings before tackling this sucker. Much of the evolution and philosophy in this book is drawn wholesale or with minor twists from Dennett, and I hear that Dennett is actually a good writer!
But enough about me. I should probably talk about the book a bit, huh? As mentioned before, the book draws on microeconomic theory, evolutionary psychology, and cognitive science to form an argument about how and why we conceptualize the 'self' the way we do. I won't try to summarize his arguments, as that would take a month, but for readers who are scratching their heads right now, I will try to give a taste of how the three disciplines fit together, and why they are converging both in this book and in the broader scientific literature. First, we have economics, which most people think of as being about taxes and interest rates. But it's not! People don't really know what economics is, least of all economists, but Don Ross makes that case that it is really the science of scarcity. That is, there is a finite amount of resources in the world, and an effectively infinite demand for them. What do agents do about it? That, according to Don Ross, is the true domain of economics. This is also what has ended up binding economics -- quite accidentally! -- to evolution and the life sciences. Scarcity, after all, is the fundamental problem of life. If there were an infinite amount of food around, an infinite amount of time for organisms to reproduce and infinite space for them to occupy, then fitness would not matter and there would be no natural selection. But scarcity exists, and thus relative fitness influences which organisms and organic structures end up propagating. And after billions of years of competition we get the human brain, which is the domain of the cognitive sciences. Using over 100 years of ideas and research from each of these fields, Ross investigates what all of these fields tell us about what the human brain is, why it is the way it is, and, most of all, what it means about our intuitive concept of the 'self' that are so deeply ingrained in us yet has no clear scientific meaning.
Which is all well and good, but first you have to figure out what the hell he is talking about. This is very much not a book for the general public, as the profoundly un-catchy title makes clear, but even for those with doctorates in one (or even more!) of the relevant fields, this book is a dense slog at best. It is so laden with unexplained jargon, unnecessary verbiage, and general vagueness that it is impossible to discriminate between the ideas that are confusing because they are complex, because they are under-explained, or because they just make no goddamn sense from the beginning. In one delightfully ironic passage, Ross reprimands his fellow philosophers for not laying out their ideas in real, feasible, grant-worthy experiments (a noble sentiment!), and then proceeds to give the most baffling, incomprehensible experiment proposal that I have ever seen. That shit would have gotten an F as a Psych 101 paper.
This major shortcoming aside, does Ross accomplish his goal? Does he offer anything new and useful to the scientific literature? I think so, but only time and much research will tell whether the ideas in this book prove scientifically useful. He occasionally overreaches and makes some fairly bizarre claims, but given that Ross is a philosopher by training it is surprised he didn't do so more often. Most of what he says is grounded in real, hard science, while at the same time he goes beyond the obvious textbook interpretations of the results to engage with big questions in a way that scientists usually do not. In this way, Ross successfully creates a cohesive, compelling, and empirically-sturdy framework for thinking about the mind and brain.
FYI, anyone interesting in topics should probably check out Daniel Dennett's writings before tackling this sucker. Much of the evolution and philosophy in this book is drawn wholesale or with minor twists from Dennett, and I hear that Dennett is actually a good writer!
August 2, 2022
The book description is already a pretty good summary of what the book is all about, and the other reviewer has also given a good overview of its pros and cons, which makes my reviewing task much easier. I'll try to keep it as short as possible while hopefully providing somewhat different and useful information about the book.
I should begin by disclosing that Ross is one of my intellectual heroes. When I decided to embark on my personal journey to construct a consistent naturalistic philosophy, it didn't take very long for me to get in touch with Ross's work; this was mainly due to him being co-author, with James Ladyman, of a book called Every Thing Must Go: Metaphysics Naturalized, which is among the deepest influences both on the way I think about the relationship between the sciences and on the way I think about how philosophy is most fruitfully done. But even before finishing ETMG I had already read a good deal of Ross's papers, as well as his most recent book, and to this day I never cease to be amazed by how the man's knowledge about so many different scientific fields is up-to-date, wide-ranging, and deep. And this brings me to this book.
Ross most general aim in the book is to specify what economics as a science has as its basic object of investigation and how it relates to cognitive science and evolutionary theory. The other reviewer is right when he says that Ross makes the case that economics is fundamentally the science of scarcity: economics is concerned with studying agents that face resource constraints and can give alternative uses to such resources. Since normally, due to its policy relevance, people associate economics with human markets, the identification of "economic agent" with "human agent" is to be expected, as it often happens. And that's where wild confusions begin. For neoclassical economic theory defines agency simply as any system that observes consistency, stability and transitivity in its choices -- a conceptual bundle known as Revealed Preference Theory (RPT) --, while we know that people behave inconsistently and exhibit preference reversals, as Ross himself surveys in the so called "experimental economics" literature.
Being aware of all of this evidence on human behavior, why won't economics make adjustments in its formal apparatus? Why do economists keep studying agency through RPT analysis? The answer Ross gives is that economic agents are most definitely not identical with human individuals. Instead, the economic agent is an abstraction, a technical concept whose target is any system whose behavior approximates RPT. And now the question becomes whether economic theory actually has any empirical relevance, to which Ross emphatically answers "yes". Here's an example to illustrate: the book makes reference to a large literature in behavioral ecology that shows how well one can explain and predict behavior by resorting to standard microeconomic analysis. I have chosen this example because it simultaneously shows how economics doesn't directly generalize over human individuals and how it can be empirically relevant, as several non-human animals studied in behavioral ecology don't display the kind of human agency of our folk conception while still being agents whose behavior can be fruitfully studied using neoclassical economic theory.
So economics is not directly about people. But of course economics is essential to making sense of a lot of the human social world, including obviously modern human markets. So how do we make sense of all of this? Ross argues that people approximate economic agency in so far as there are relevant external pressures (institutional and social structures especially) to incentivize this behavioral pattern. And here comes the most interesting part: economics is also relevant for making serious, scientifically driven sense of the very notion of human selfhood. Just to give it a little taste and entice curiosity: building on Dan Dennett's philosophical ground, Ross argues that human selves have come into existence as stabilizing solutions to coordination problems in the evolution of human sociality (and to understand this we need game theory). To properly see this, we have to go on an interdisciplinary endeavor that brings together neuroscience, cognitive and behavioral sciences, and evolutionary theory, and Ross puts great effort in carefully doing exactly that. But in order to clear the path, a previous general philosophical work had to be done. So Ross spends some time sketching and motivating his philosophy of science, which is a variety of non-reductionist, unificationist scientific realism. This may be boring to some, but it's a very important background discussion to be aware of, as there are a variety of different philosophically motivated ways people can try either to deny that economics should be regarded as an autonomous science, or to deny that the neoclassical concept of economic agency is indispensible for explaining and predicting some phenomena. In fact, throughout the book Ross makes his case by contrasting his position with other positions that have been put forward about the relationship between economics and other special sciences.
I can't overstate how influential this book is for me. Like I've already mentioned, Ross is a great inspiration for me, as he brilliantly exemplifies how serious naturalistic philosophy should be done, and in this book things are no different in this regard. Ross provides a clear, systematic and detailed defense of his view of what economics is about and how it relates to neighboring sciences, and in the process he puts great effort presenting the main arguments from opposing views with high fidelity, and as a result it should be emphasized (if it weren't obvious by now) that the book is very dense. People totally unfamiliar with some microeconomic theory, contemporary issues in general philosophy of science and in philosophy of mind, and some cognitive science shouldn't read this book before getting a basic grip on these subjects. Ross does try to make things easier and clearer for people unfamiliar with one or more of these subjects by introducing and explaining several important concepts and empirical results, but they're not enough to avoid laypeople from having a very difficult time reading a book that already demands careful attention from people who are familiar with the relevant subjects. But for people interested in the place of economics as a bona fide autonomous science in our broader scientific worldview the personal investment in this book absolutely pays off, even if one ends up unpersuaded by some of the arguments.
I should begin by disclosing that Ross is one of my intellectual heroes. When I decided to embark on my personal journey to construct a consistent naturalistic philosophy, it didn't take very long for me to get in touch with Ross's work; this was mainly due to him being co-author, with James Ladyman, of a book called Every Thing Must Go: Metaphysics Naturalized, which is among the deepest influences both on the way I think about the relationship between the sciences and on the way I think about how philosophy is most fruitfully done. But even before finishing ETMG I had already read a good deal of Ross's papers, as well as his most recent book, and to this day I never cease to be amazed by how the man's knowledge about so many different scientific fields is up-to-date, wide-ranging, and deep. And this brings me to this book.
Ross most general aim in the book is to specify what economics as a science has as its basic object of investigation and how it relates to cognitive science and evolutionary theory. The other reviewer is right when he says that Ross makes the case that economics is fundamentally the science of scarcity: economics is concerned with studying agents that face resource constraints and can give alternative uses to such resources. Since normally, due to its policy relevance, people associate economics with human markets, the identification of "economic agent" with "human agent" is to be expected, as it often happens. And that's where wild confusions begin. For neoclassical economic theory defines agency simply as any system that observes consistency, stability and transitivity in its choices -- a conceptual bundle known as Revealed Preference Theory (RPT) --, while we know that people behave inconsistently and exhibit preference reversals, as Ross himself surveys in the so called "experimental economics" literature.
Being aware of all of this evidence on human behavior, why won't economics make adjustments in its formal apparatus? Why do economists keep studying agency through RPT analysis? The answer Ross gives is that economic agents are most definitely not identical with human individuals. Instead, the economic agent is an abstraction, a technical concept whose target is any system whose behavior approximates RPT. And now the question becomes whether economic theory actually has any empirical relevance, to which Ross emphatically answers "yes". Here's an example to illustrate: the book makes reference to a large literature in behavioral ecology that shows how well one can explain and predict behavior by resorting to standard microeconomic analysis. I have chosen this example because it simultaneously shows how economics doesn't directly generalize over human individuals and how it can be empirically relevant, as several non-human animals studied in behavioral ecology don't display the kind of human agency of our folk conception while still being agents whose behavior can be fruitfully studied using neoclassical economic theory.
So economics is not directly about people. But of course economics is essential to making sense of a lot of the human social world, including obviously modern human markets. So how do we make sense of all of this? Ross argues that people approximate economic agency in so far as there are relevant external pressures (institutional and social structures especially) to incentivize this behavioral pattern. And here comes the most interesting part: economics is also relevant for making serious, scientifically driven sense of the very notion of human selfhood. Just to give it a little taste and entice curiosity: building on Dan Dennett's philosophical ground, Ross argues that human selves have come into existence as stabilizing solutions to coordination problems in the evolution of human sociality (and to understand this we need game theory). To properly see this, we have to go on an interdisciplinary endeavor that brings together neuroscience, cognitive and behavioral sciences, and evolutionary theory, and Ross puts great effort in carefully doing exactly that. But in order to clear the path, a previous general philosophical work had to be done. So Ross spends some time sketching and motivating his philosophy of science, which is a variety of non-reductionist, unificationist scientific realism. This may be boring to some, but it's a very important background discussion to be aware of, as there are a variety of different philosophically motivated ways people can try either to deny that economics should be regarded as an autonomous science, or to deny that the neoclassical concept of economic agency is indispensible for explaining and predicting some phenomena. In fact, throughout the book Ross makes his case by contrasting his position with other positions that have been put forward about the relationship between economics and other special sciences.
I can't overstate how influential this book is for me. Like I've already mentioned, Ross is a great inspiration for me, as he brilliantly exemplifies how serious naturalistic philosophy should be done, and in this book things are no different in this regard. Ross provides a clear, systematic and detailed defense of his view of what economics is about and how it relates to neighboring sciences, and in the process he puts great effort presenting the main arguments from opposing views with high fidelity, and as a result it should be emphasized (if it weren't obvious by now) that the book is very dense. People totally unfamiliar with some microeconomic theory, contemporary issues in general philosophy of science and in philosophy of mind, and some cognitive science shouldn't read this book before getting a basic grip on these subjects. Ross does try to make things easier and clearer for people unfamiliar with one or more of these subjects by introducing and explaining several important concepts and empirical results, but they're not enough to avoid laypeople from having a very difficult time reading a book that already demands careful attention from people who are familiar with the relevant subjects. But for people interested in the place of economics as a bona fide autonomous science in our broader scientific worldview the personal investment in this book absolutely pays off, even if one ends up unpersuaded by some of the arguments.
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