Remembering Robert Trivers

Robert Trivers, who died on March 12, 2026, was arguably the most important evolutionary theorist since Darwin. He had a rare gift for seeing through the messy clutter of life and revealing the underlying logic beneath it. E. O. Wilson called him “one of the most influential and consistently correct theoretical evolutionary biologists of our time.” Steven Pinker described him as “one of the great thinkers in the history of Western thought.”

I was Robert’s graduate student at Rutgers from 2006 to 2014. Long before I knew him personally, however, he had already established himself as one of the most original and insightful scientists of the twentieth century. In an astonishing series of papers in the early 1970s, he changed forever our understanding of evolution and social behavior.

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The next year in 1972, Trivers published his most cited paper, Parental Investment and Sexual Selection. Here he offered a unified explanation for something that had puzzled biologists since Darwin. Writing perhaps the most famous sentence in all of evolutionary biology—“What governs the operation of sexual selection is the relative parental investment of the sexes in their offspring”—Trivers threw down the gauntlet and revealed a deceptively simple principle that reorganized the field. From that insight flowed one of the most powerful and falsifiable ideas in modern science: the sex that invests more in offspring will tend to be choosier about mates, while the sex that invests less will compete more intensely for access to them.

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Each of these papers spawned entirely new research fields, and many have dedicated their careers to unpacking and testing the implications of his ideas. As Harvard biologist David Haig put it, “I don’t know of any comparable set of papers. Most of my career has been based on exploring the implications of one of them.” Indeed, it is hardly an exaggeration to say that his ideas gave birth to the field of evolutionary psychology and the whole line of popular Darwinian books from Richard Dawkins and Robert Wright to David Buss and Steven Pinker.

To know Robert personally, however, was to confront a more uneven and less orderly organism— to use one of his favorite words—than the one revealed in his papers. The man who explained the hidden order in life often struggled to impose order in his own. “Genius” is one of the most overused words in the language, with “asshole” not far behind, and I have known few people who truly deserved either label. Robert deserved both. He could be genuinely funny, extraordinarily generous, and breathtakingly perceptive, but also moody, childish, and needlessly cruel.

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I used to joke that one reason he was so good at explaining behaviors the rest of us took for granted was that he was like an alien visiting our planet trying to make sense of our strange habits—why we invest in our children, why we are nice to our friends, why we lie to ourselves. He told me that conflict with his own father was part of the inspiration for parent-offspring conflict and one of the observations that led to his insight into parental investment came from watching male pigeons jockeying for position on a railing outside his apartment window in Cambridge.

Robert also had a respect for evidence and for correcting mistakes that I’ve rarely seen among academics, a group not known for their humility. He cared more about truth than about his reputation and retracted papers at great cost to himself and his career when he thought there were errors. He also knew that he was standing on the shoulders of the giants who had come before him. 

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He was a lifelong learner with a willingness to do hard things. After his astonishing early success, he could have done what many academics do: stay in his lane, guard his territory, and spend the rest of his career commenting on ideas he had already had. Instead, in the early 1990s he saw that genetics mattered and spent the next fifteen years trying to master it. The result was Genes in Conflict, the 2006 book he wrote with Austin Burt, which pushed his interest in conflict down to the level of selfish genetic elements. Few scientists, after making contributions as important as he had, would have had the curiosity, humility, and stamina to begin again in an entirely new area.

Trivers was a great teacher, though not always in the ways he intended. He often asked dumb questions—’What does cytosine bind to again?’ in the middle of a genetics seminar and made obvious observations—’Did you know that running the air-conditioner in the car uses gas?’ But as he liked to say, ‘I might be ignorant, but I ain’t gonna be for long.’ He could also be volatile and aggressive and there were many times when he threatened to kick my ass. I may have been the only graduate student who ever had to wonder whether he could take his advisor in a fight. Once, over lunch at Rutgers, I asked about a cut on his thumb after he had returned from one of his frequent trips to Jamaica. He matter-of-factly told me that he had just survived a home invasion in which two men armed with machetes held him hostage. He escaped by jumping from a second-story window, rolling downhill, and stabbing both men with the eight-inch knife he carried everywhere he went. He was 67 at the time.

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One of the last times I spoke with Robert, a fall had left his right arm nearly useless. He described it as “two sausages connected by an elbow.” He was a chaotic and deeply imperfect man, but also one of the few people whose ideas permanently changed how we understand evolution, animal behavior, and ourselves. Steven Pinker wrote that “it would not be too much of an exaggeration to say that [Trivers] provided a scientific explanation for the human condition: the intricately complicated and endlessly fascinating relationships that bind us to one another.” That seems just about right to me. His ideas are some of the deepest insights we have into human nature, animal behavior, and our place in the web of life. The mark of a great person is someone who never reminds us of anyone else. I have never known anyone like him. I’ll miss you, Robert. You asshole.

- More Here

The fascinating Insights Of Robert Trivers

Trivers was one of the most—perhaps the most—influential evolutionary biologists of the 20th century. His work should be much more widely known in social and behavioural sciences, in particular in economics, as Trivers’ intellectual approach is very much in line with a game theoretic understanding of social interactions.

It is hard to overstate the importance of his work. Einstein famously published four groundbreaking papers in 1905, a year often referred to as his “Annus mirabilis”, during which he revolutionised physics. Trivers might be said to have had a “Quinquennium Mirabile” for the five years between 1971 and 1976, during which he produced a series of ideas that revolutionised evolutionary biology.

Reciprocal altruism - 1971:

The human altruistic system is a sensitive, unstable one. Often it will pay to cheat: namely, when the partner will not find out, when he will not discontinue his altruism even if he does find out, or when he is unlikely to survive long enough to reciprocate adequately. And the perception of subtle cheating may be very difficult. Given this unstable character of the system, where a degree of cheating is adaptive, natural selection will rapidly favor a complex psychological system in each individual regulating both his own altruistic and cheating tendencies and his responses to these tendencies in others. As selection favors subtler forms of cheating, it will favor more acute abilities to detect cheating.

Parental investment -1972:

Since the female already invests more than the male, breeding failure for lack of an additional investment selects more strongly against her than against the male. In that sense, her initial very great investment commits her to additional investment more than the male’s initial slight investment commies him.

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Critics of evolutionary theory sometimes argue that it does not make any predictions that can be tested and that it only rationalises what has already been observed. Trivers’ work is one of the best examples disproving this accusation. In his paper on parental investment, Trivers argues that the differences in behaviour between males and females should reflect the degree of asymmetry in their parental investment. As a result, animals with more parental investment asymmetry should show greater asymmetry than those with less, and if we ever find animals with role reversals, we should also observe reversals in strategies. And indeed, we observe that in animals with less asymmetry in parental investment, like swans, the differences between males and females are less noticeable. In the rare cases where male investments are larger, like in seahorses, where the females literally place their eggs in the belly of the male who incubates them, we observe a role reversal, with females courting males and competing for access to them.

Parent Offspring Conflict - 1974:

The offspring can cry not only when it is famished but also when it merely wants more food than the parent is selected to give. Likewise, it can begin to withhold its smile until it has gotten its way. Selection will then of course favor parental ability to discriminate the two uses of the signals, but still subtler mimicry and deception by the offspring are always possible.

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Obviously, overall parents tend to love their children and children tend to love their parents, but Trivers showed—with a theory now largely supported by empirical research— that the whole picture is more complex, because there are always also elements of conflict in parent-offspring relations.

Self-deception - 1976:

In the preface to Dawkins’ The Selfish Gene, Robert Trivers proposed a solution to this problem: our tendency to self-deceive, to think we are better than we are, may serve as a mechanism that enables us to deceive others more effectively. He wrote:

If … deceit is fundamental to animal communication, then there must be strong selection to spot deception and this ought, in turn, to select for a degree of self-deception, rendering some facts and motives unconscious so as not to betray – by the subtle signs of self-knowledge – the deception being practiced. —Trivers (1976)

Commenting on this assertion, psychologist Steven Pinker remarked, “This sentence... might have the highest ratio of profundity to words in the history of the social sciences”

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In a 2011 paper with Bill von Hippel, Trivers developed this idea further, listing how self-deception can help. When trying to deceive, people may face cognitive load (the cognitive work required to make sure a web of lies does not have glaring contradictions). Given that lying is a betrayal of trust and is sanctioned when it is found out, it is risky, and people can get nervous about being found out, possibly showing signs of nervousness. Finally, people might try to mask signs of nervousness, thereby also behaving in a way that indirectly suggests lying. Self-deception, by inducing people to believe in their own lies, so to speak, can eliminate these possible clues while leading others to believe the preferred story of the person self-deceiving.

Trivers’ theory of self-deception has been supported by empirical research (including research I have contributed to). It explains what seems to be one of the most irrational patterns of human behaviour as emerging from strategic incentives.

Trivers has been one of the most influential evolutionary biologists, and his papers are still worth reading today. His insights, published more than 50 years ago, are fascinating. They often align very well with economic theories of behaviour, and it is therefore regrettable that his ideas are not more well-known in economics, and in particular in behavioural economics.

A key feature of Trivers’ take across these contributions was to see that beneath the world of social interactions we observe, there are deep structures in terms of incentives that shape the game we play. Understanding these games and their structures helps us make sense of the seemingly endless complexity of human psychology and social dynamics. In several key contributions, Trivers helped lift the veil on the underlying logic of human behaviour.

- More Here

In Search For A Successor To Neoliberalism

 “Neoliberalism’s anti-government, free-market fundamentalism is simply not suited for today’s economy and society, but what comes next is still not fully developed,” said Larry Kramer, president of the William and Flora Hewlett Foundation, which launched its Economy and Society Initiative in December 2020 to focus on identifying a successor to neoliberalism. “This joint effort reflects our shared interest in replacing outdated 20th-century thinking — individualistic versus collectivist, central control versus free markets, liberty versus equality, and the like — with new ideas that can lead to broader economic justice and prosperity for people around the world. This is a first step to support forward-thinking scholars, students, and thought leaders who can break out of a patently failing neoliberal paradigm, with its ossified left-right divides, and help shape a bold new vision for what people should expect from their governments and economies.”

“In the decades since economists like Milton Friedman and Friedrich Hayek first developed their economic theories, our understanding of the world and the behavior that drives it has exponentially improved. Collectively, we have made great gains in understanding the cause and effects of economic inequality; created vast online social networks that operate from pocket-sized computers; sequenced the human genome; and achieved a much more comprehensive understanding of evolutionary biology and the fundamentally cooperative nature of human beings. Yet the economic models and assumptions utilized by many academics, economists, and policymakers haven’t remotely kept pace with these advancements,” said Omidyar Network CEO Mike Kubzansky. “Now, more than ever, it is imperative that we prioritize interdisciplinary scholarship to update our knowledge of complexity to better understand our economy — the ultimate complex, dynamic system. We are pleased to join the Hewlett Foundation and our other partners in supporting a new cadre of academic leaders, and a new epoch in the study of economics and its intersection with a diverse range of fields. Together, we can change the ideas that will change the world.”

- Reimagining Capitalism: Major Philanthropies Launch Effort at Leading Academic Institutions

I personally been thinking about alternatives for a very long time. It is not easy. 

I laud this new initiative but I am apprehensive: 

• I sincerely hope this is not a camouflage to re-brand socialism. Fifty percent of this team should include right-wing/neoliberals. If you don't understand why then please quit and go read Team of Rivals: The Political Genius of Abraham Lincoln
• Everyone involved should have spend time in some of the most poverty and crime ridden places on earth. Read William Easterly's The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor 
• I don't care about the color or nationality of the team but the ideas cannot come sitting in a comfortable western villa . Live the life of people who will be impacted by your decisions. Read Taleb's Skin in the Game: Hidden Asymmetries in Daily Life.
• Daily mantra of the team should be: Road to hell is paved with good intentions. 

Copernican Moment In Economics Is Near (Hopefully!)

If you never understood some rudimentary economic principles and their "grand" problems; Dennis J. Snower's piece lays it out brilliantly. 

It's a great place to understand what is microeconomics, macroeconomics, behavior economics, government regulation, and the famous invisible hand of Adam Smith. 

Here are some grand problems in reality which current economic "theories" refuse to address: 

• If the free-market system is meant to satisfy our needs efficiently, why is it despoiling our environment? 

• Why is it generating inequalities and other inequities that threaten the social cohesion of our societies? 

• Why does it leave so many people economically insecure, vulnerable to unemployment and trapped in dead-end jobs? 

• Why does it not correct for the excesses of consumerism, workaholism and digital addictions, frequently leading to anxiety, depression, burnout, substance abuse and crime? 

• Why is it giving us so little guidance in promoting public compliance with social distancing rules during the Covid-19 pandemic, even though such compliance has economic causes and consequences?

• Why does it keep so many businesses focused on short-term profit and shareholder value, even though so many business leaders are genuinely concerned about the environment and the wellbeing of their customers and employees?

My meta-level answers to the above questions are (to state the obvious - socialism is the worst virus and here we are trying to avoid capitalism becoming a virus before its too late):

Capitalism and free-market have become an ideology rather than seen as a tools-in-progress to be improved continuously to benefit life on earth, 

Tribalism -  "believing" and "following" other sapiens in their network by mindless habit and for social bonding with relic moral values (and if morality is part of that bonding),

And finally, the sheer inability of sapiens to change their minds as and when realities change. 

Crazy as it sounds, economists answers to these questions have no skin-in-the-game and if-you-have-a-hammer-every-problem-is-like-a-nail syndrome: 

• These questions may be important, but the answers lie outside the domain of economics. For environmental problems, turn to the life sciences; for social problems, turn to sociology and anthropology; for psychological problems, turn to psychology; for crime, turn to law; and so on. 

• Economics can deal with these questions through its standard policy toolbox: taxes and subsidies, government regulations, quotas, remuneration schemes, and other instruments that provide monetary incentives for some behaviors and forbid others. 

Shower shares some positive news and I read with a healthy dose of skepticism: 

Now the practitioners’ patience with mainstream economics is wearing thin. Unlike the academic economists, the practitioners must actually address the great economic questions of our time. They cannot afford to be satisfied with the two above-mentioned standard answers. They cannot accept that these questions lie outside the domain of economics, even though they have many important economic causes (the world economy as driver of climate change, economic inequalities as drivers of populism and social fragmentation, and so on) and many important economic consequences (climate change driving migration, populism leading to protectionism, and so on). Nor can the practitioners be content with the economists’ standard policy toolbox, since these instruments are obviously not overcoming the growing problems of climate change, social conflict, “deaths of despair,” containment of the Covid-19 pandemic, and much more. 

And finally, the practitioners are no longer enamored by the mainstream narrative on the division of responsibilities. Consumers in their millions are taking an interest in the social, political and environmental consequences of consumption and production activities, school children are out in the streets in protest about climate change, international organizations are beginning to measure economic performance beyond GDP (such as through the OECD’s Better Life Index and the UN’s Sustainable Development Goals), businesses are beginning to measure business performance beyond shareholder value (such as through Environmental, Social and Governance criteria along with the initiatives of the WEF International Business Council, the OECD Business for Inclusive Growth coalition, the Value Balancing Initiative, the British Academy’s Future of the Corporation programme), national governments are beginning to design budgets with regard to notions of wellbeing that extend beyond consumption of goods and services (such as New Zealand’ wellbeing budget). In short, the practitioners are not waiting for the mainstream economics profession to adjust to reality; instead, they are forging ahead on multiple fronts, extending the domain of economics to the existential challenges we face. 

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This is a different starting point from the one underlying mainstream economics. The discipline of economics is based on classical physics, i.e. the inanimate world. Evolution, by contrast, is appropriate to the animate world. Not a bad point of departure for economics. After all, humans are living creatures. If we choose this path, economics will be reaching its Darwinian – not Copernican – Moment. 

This is why now is probably the most exciting and fruitful time ever to become an aspiring economist. The Dutch philosopher Erasmus famously said:

“At the end, you will ask yourself: What have I made of my life? That wish you wish to answer then, do now.” 

Who would not wish to be alive and active at such a moment, when a great contribution is waiting to be made and there is no one around to execute you for it?

What I've Been Reading

Skin in the Game: Hidden Asymmetries in Daily Life by Nassim Nicholas Taleb.

Brilliant :-)

1. The minority rule produces low variance outcomes.
2. Never compare a multiplicative, systemic, and fat-tailed risk to a non-multiplicative, idiosyncratic, and thin-tailed one.
3. Courage is when you sacrifice your own well-being for the sake of the survival of a layer higher than yours.
4. How much you truly "believe" in something can be manifested only through what you are willing to risk for it.
5. There is no love without sacrifice, no power without fairness, no facts without rigor, no statistics without logic, no teaching without experience, no complication without depth, no science without skepticism, and nothing without skin in the game.  

A great review here as well.

Richard Thaler - Nobel Lecture

What I've Been Reading

The Undoing Project: A Friendship That Changed Our Minds by Michael Lewis.  What could we expect when a best writer of our generation writes about one of the best friendships of this generation? Only Michael Lewis can pull this off !!

That was another thing colleagues and students noticed about Danny: how quickly he moved form his enthusiasms, how easily he accepted failure. It was as if he expected it. But he wasn't afraid of it. He'd try anything. He thought of himself as someone who enjoyed, more than most, changing his mind. "I get a sense of movement and discovery whenever I find a flaw in my thinking," he said. His theory of himself dovetailed neatly with this moodiness. In his darker moods, he become fatalistic - and was so wasn't surprised or disturbed when he did fail. (He'd been proven right!) In his up moments he was so full of enthusiasm that seemed to forget the possibility of failure, and would run with any new idea that comes his way. "He could drive people up the wall with his volatility," said fellow Hebrew University psychologist Maya Bar-Hillel. "Something was genius one day and crap the next, and the genius the next day and crap the next." What drove other crazy might have helped to keep Danny same. His moods were grease for his idea factory. 

In Amos's company Danny felt funny too - and he'd never felt that way before. In Danny's company Amos, too, became a different person:uncritical. Or, at least uncritical of whatever came from Danny. He didn't even poke fun in jest. He enabled Danny to feel, in a way he hand't before, confident. Maybe for the first time in his Danny was playing offense. "Amos did not write in a defensive crouch," e said. "There was something liberating about the arrogance - it was extremely rewarding to feel like Amos, smarter than almost everyone." 

The men who revealed our innate stupidity couldn't control their innate biases that affected their friendship... And that should teach us so much about human nature.

The Undoing Project by Micheal Lewis

Before the war, Danny and Amos had shared the hope that their work on human judgment would find its way into high-stakes real-world decision-making. In this new field, called decision analysis, they could transform high-stakes decision-making into a sort of engineering problem. They would design decision-making systems. Experts on decision-making would sit with leaders in business, the military, and government and help them to frame every decision explicitly as a gamble, to calculate the odds of this or that happening, and to assign values to every possible outcome.

If we seed the hurricane, there is a 50 percent chance we lower itsAdapted from The Undoing Project: A Friendship That Changed Our Minds, by Michael Lewis wind speed but a 5 percent chance that we lull people who really should evacuate into a false sense of security: What do we do?

In the bargain, the decision analysts would remind important decision-makers that their gut feelings had mysterious powers to steer them wrong. “The general change in our culture toward numerical formulations will give room for explicit reference to uncertainty,” Amos wrote in notes to himself for a talk of his own. Both Amos and Danny thought that voters and shareholders and all the other people who lived with the consequences of high-level decisions might come to develop a better understanding of the nature of decision-making. They would learn to evaluate a decision not by its outcomes—whether it turned out to be right or wrong—but by the process that led to it. The job of the decision-maker wasn’t to be right but to figure out the odds in any decision and play them well. As Danny told audiences in Israel, what was needed was a “transformation of cultural attitudes to uncertainty and to risk.”

Exactly how some decision analyst would persuade any business, military, or political leader to allow him to edit his tis thinking was unclear. How would you even persuade some important decision-maker to assign numbers to his “utilities” (that is, personal value as opposed to objective value)? Important people didn’t want their gut feelings pinned down, even by themselves. And that was the rub.

Later, Danny recalled the moment he and Amos lost faith in decision analysis. The failure of Israeli intelligence to anticipate the Yom Kippur attack led to an upheaval in the Israeli government and a subsequent brief period of introspection. They’d won the war, but the outcome felt like a loss. The Egyptians, who had suffered even greater losses, were celebrating in the streets as if they had won, while everyone in Israel was trying to figure out what had gone wrong. Before the war, the Israeli intelligence unit had insisted, despite a lot of evidence to the contrary, that Egypt would never attack Israel as long as Israel maintained air superiority. Israel had maintained air superiority, and yet Egypt had attacked. After the war, with the view that perhaps it could do better, Israel’s Ministry of Foreign Affairs set up its own intelligence unit. The man in charge of it, Zvi Lanir, sought Danny’s help. In the end, Danny and Lanir conducted an elaborate exercise in decision analysis. Its basic idea was to introduce a new rigor in dealing with questions of national security. “We started with the idea that we should get rid of the usual intelligence report,” said Danny. “Intelligence reports are in the form of essays. And essays have the characteristic that they can be understood any way you damn well please.” In place of the essay, Danny wanted to give Israel’s leaders probabilities, in numerical form.

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Danny and Lanir then presented their probabilities to Israel’s Foreign Ministry. (“The National Gamble,” they called their report.) Foreign Minister Allon looked at the numbers and said, “Ten percent increase? That is a small difference.”

Danny was stunned: if a 10 percent increase in the chances of full-scale war with Syria wasn’t enough to interest Allon in Kissinger’s peace process, how much would it take to turn his head? That number represented the best estimate of the odds. Apparently, the foreign minister didn’t want to rely on the best estimates. He preferred his own internal probability calculator: his gut. “That was the moment I gave up on decision analysis,” said Danny. “No one ever made a decision because of a number. They need a story.” As Danny and Lanir wrote, decades later, after the U.S. Central Intelligence Agency asked them to describe their experience in decision analysis, the Israeli Foreign Ministry was “indifferent to the specific probabilities.” What was the point of laying out the odds of a gamble if the person taking it either didn’t believe the numbers or didn’t want to know them? The trouble, Danny suspected, was that “the understanding of numbers is so weak that they don’t communicate anything. Everyone feels that those probabilities are not real—that they are just something on somebody’s mind.”

- Excerpts from The Undoing Project: A Friendship That Changed Our Minds, by Michael Lewis

Wisdom Of The Week

It's like obesity. The NHS is thinking about charging people to be fat because, like smoking, they say it's your fault. Weight is not as heritable as height, but it's highly heritable. Maybe 60 percent of the differences in weight are heritable. That doesn't mean you can't do anything about it. If you stop eating, you won't gain weight, but given the normal life in a fast-food culture, with our Stone Age brains that want to eat fat and sugar, it's much harder for some people.

We need to respect the fact that genetic differences are important, not just for body mass index and weight, but also for things like reading disability. I know personally how difficult it is for some children to learn to read. Genetics suggests that we need to have more recognition that children differ genetically, and to respect those differences. My grandson, for example, had a great deal of difficulty learning to read. His parents put a lot of energy into helping him learn to read. We also have a granddaughter who taught herself to read. Both of them now are not just learning to read but reading to learn.

Genetic influence is just influence; it's not deterministic like a single gene. At government levels—I've consulted with the Department for Education—I don't think they're as hostile to genetics as I had feared, they're just ignorant of it. Education just doesn't consider genetics, whereas teachers on the ground can't ignore it. I never get static from them because they know that these children are different when they start. Some just go off on very steep trajectories, while others struggle all the way along the line. When the government sees that, they tend to blame the teachers, the schools, or the parents, or the kids. The teachers know. They're not ignoring this one child. If anything, they're putting more energy into that child.

It's important to recognize and respect genetically driven individual differences. It's better to make policy based on knowledge than on fiction. A lot of what I see in education is fiction. In education, part of the reason people shy away from genetics is because they think it's associated with a right-wing agenda. It's so important to emphasize that scientific facts are neutral. It's the values that you apply to them that should determine policy.

- Why We're Different, Edge - A Conversation With Robert Plomin

What I've Been Reading

And we have to start paying attention to those supposedly irrelevant factors, what I will call SIFs for short.

Misbehaving: The Making of Behavioral Economics by Richard H. Thaler. Wonderful auto-biography of behavioral economics;  I was laughing so hard at times that Max was jealous and started jumping on me. I have learned so much from Thaler and co., over the years;  they helped me understand human nature better. Thank you for nudging the world towards a better place.

Having read Tetlock's Superforecasting last week; I am going to make two bold predictions (with a time frame of-course):

• Thaler's will be receiving his long over due Nobel within next five years. 
• Sapiens will screw up behavioral economics within next fifteen years that it will look paternalist rather than libertarian paternalism.  

Here's economist John Lott defending (read sunk cost) Coarse theorem:

Couldn't the low trading of the mugs be explained by transaction cost? I explained that the tokens experiment had ruled out this explanation - after all, the tokens had the same transaction cost as the mugs, and the tokens did trade as much as the theory predicted. She (Lott's wife) seemed satisfied, but then Lott jumped in to "help". "Well," he asked, "couldn't we just call the endowment effect itself a transaction cost?". I was shocked by this comment; transaction cost are supposed to cost of doing transaction - not a desire to do a transaction. If we are free to relabel preferences as "costs" at will so that behavior appears to be consistent with the standard theory, then the theory is both untestable and worthless. So instead of trying to reason with Lott, I turned to Posner and asked him whether he would now concede that I am not the least scientific person in the room. Posner smiled, nodded his agreement, and everyone in the room who could see him laughed. 

What I've Been Reading

Just as clean air makes respiration possible, silence, in this broader sense, is what makes it possible to think. We give it up willingly when we are in the company of other people with whom we have some relationship, and when we open ourselves to serendipitous encounters with strangers. To be addressed by mechanized means is an entirely different matter.

To attend to anything in a sustained way requires actively excluding all the other things that grab at our attention. It requires, if not ruthlessness toward oneself, a capacity for self-regulation.

The World Beyond Your Head: On Becoming an Individual in an Age of Distraction by Matthew B. Crawford. I was totally surprised reading this lesser know book; Crawford gives Nicholas Carr run for this money. A gem of book - "Cognitive Extension" is the recurring theme of the book which he delivers through analogies of racing, organ makers (yes, did you know they cost over a million bucks and are handmade?) and other "lesser" known crafts.

There is a very real sense in which a tool may be integrated into one’s body, for one who has become expert in using the tool. There is a growing number of studies that support this idea of “cognitive extension”; the new capacities added by tools and prosthetics become indistinguishable from those of the natural human body, in terms of how they are treated by the brain that organizes our actions and perceptions.

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Surprisingly, it is in the field of robotics that some of the most convincing evidence has emerged that inference, calculation, and representation are a grossly inefficient way to go about negotiating a physical environment. In his now-classic article “Intelligence Without Representation,” published in the journal Artificial Intelligence in 1991, Rodney Brooks wrote that “the world is its own best model.” Roboticists are learning a lesson that evolution learned long ago, namely, that the task of solving problems needn’t be accomplished solely by the brain, but can be distributed among the brain, the body, and the world.

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In a variation on the old funk dictum, we might say, “Involve your ass, your mind will follow.” And conversely, “Free your ass, your mind will wander.” I suspect John Muir is right with his image of the Aztec hood ornament: having some skin in the game would seem to be an important safety variable.

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In a culture predicated on this autonomy-heteronomy distinction, it is difficult to think clearly about attention— the faculty that joins us to the world— because everything located outside your head is regarded as a potential source of unfreedom, and therefore a threat to the self. This makes education a tricky matter.

What I've Been Reading

How to Write a Thesis by Umberto Eco.

This book was written in 1977 in Italian but the English translation came out only this year. A must read for students and non-students; tons of wisdom even if you don't plan to do a thesis.Here's a brilliant excerpt which would make any neuroscientist smile:

I show the page to Placido, and then I read him the excerpt that helped me so much. I read it, I read it again, and I am astonished. The abbot Vallet had never formulated the idea that I attributed to him; that is to say he had never made the connection that seemed so brilliant to me, a connection between theory of judgement and theory of beauty.

Vallet wrote of something else. Stimulated in some mysterious way by what he was saying, I made the connection myself and, and as I identified the idea with the text I was underlining, I attributed it to Vallet. And for more than twenty years I have been grateful to the old abbot for something he had never given me. I had produced the magic key on my own.

But is this really how it is? Is the merit of that idea truly mine? Had I never read Vallet, I would never have had that idea. He may not have been the father of the idea, but he certainly was, so to speak, its obstetrician. He did not gift me with anything, but he kept my mind in shape, and he somehow stimulated my thinking. Is this not also what we ask from a teacher, to provoke us to invent ideas?

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I am not sure what the moral of this story is, but I know there is at least one, and it is very beautiful. I wish my readers to find many abbot Vallet over the course of their lives, and I aspire to become someone else's abbot Vallet. 

What I've Been Reading

What can be added to the happiness of the man who is in health, who is out of debt, and has a clear conscience?

“Very little.”

How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness by Russ Roberts.

Adam Smith's first book The Theory of Moral Sentiments is really a hard book to read and I never got around reading it. Russ Roberts has done us a huge favor for by writing this new book. Go, get this book and read it - this is the best book I have read this year.

Smith’s awareness of our inability to see ourselves clearly finds an echo in the modern literature at the intersection of psychology and economics called behavioral economics , a field that challenges the strict rationality of most modern economic models. Daniel Kahneman won the Nobel Prize in Economics for experimental work he did with Amos Tversky that examined how easily and often we misperceive reality. The co-winner that year was Vernon Smith, another experimentalist who studies how the mistakes people make individually can be tempered by their interactions with others in the marketplace. So while we may think our house is actually more beautiful than it is or our skills are more valuable than they really are, when we try to sell our house or look for a job, we gain a richer appreciation of how things truly are. I like to think Adam Smith would respect the work of both Kahneman and Vernon Smith and see them both as his intellectual heirs.

Wisdom Of the Week

Smith notes a number of differences between how we react to grief and joy that is felt by others: There is, however, this difference between grief and joy, that we are generally most disposed to sympathize with small joys and great sorrows.

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This asymmetry of joy and sorrow— the ease with which we sympathize with success relative to failure— is Smith’s explanation for why the rich and famous receive more attention and create more happiness than the poor and forgotten. We enjoy the successes of the rich and famous. The poor and forgotten move us briefly and not deeply. For Smith, this explains why rich people flaunt their wealth and poor people hide what they are missing: It is because mankind are disposed to sympathize more entirely with our joy than with our sorrow, that we make parade of our riches, and conceal our poverty. Nothing is so mortifying as to be obliged to expose our distress to the view of the public, and to feel, that though our situation is open to the eyes of all mankind, no mortal conceives for us the half of what we suffer. Nay, it is chiefly from this regard to the sentiments of mankind, that we pursue riches and avoid poverty.

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We don’t experience great grief the same way we experience great joy. The joy of others can make us happy, as long as we are not envious. The grief of others has a much more limited effect, even for close friends.

- Excerpts from the excellent book How Adam Smith Can Change Your Life: An Unexpected Guide to Human Nature and Happiness by Russ Roberts

What I've Been Reading

The Black Swan: The Impact of the Highly Improbable Fragility by Nassim Nicholas Taleb. I think this is the first book in my recent memory I have re-read. Having respect for mother nature, getting ideas translated into math, understanding limitations of our math and most importantly getting deep into an idea are all timeless traits one needs to learn from Taleb. 

The postcrash years were entertaining for me, intellectually. I attended conferences in finance and mathematics of uncertainty; not once did I find a speaker, Nobel or no Nobel, who understood what he was talking about when it came to probability, so I could freak them out with my questions . They did “deep work in mathematics,” but when you asked them where they got their probabilities, their explanations made it clear that they had fallen for the ludic fallacy— there was a strange cohabitation of technical skills and absence of understanding that you find in idiot savants. Not once did I get an intelligent answer or one that was not ad hominem. Since I was questioning their entire business, it was understandable that I drew all manner of insults: “obsessive,”“commercial,”“philosophical,”“essayist,”“idle man of leisure,” “repetitive,”“practitioner” (this is an insult in academia), “academic” (this is an insult in business). Being on the receiving end of angry insults is not that bad; you can get quickly used to it and focus on what is not said. Pit traders are trained to handle angry rants . If you work in the chaotic pits, someone in a particularly bad mood from losing money might start cursing at you until he injures his vocal cords, then forget about it and, an hour later, invite you to his Christmas party. So you become numb to insults, particularly if you teach yourself to imagine that the person uttering them is a variant of a noisy ape with little personal control. Just keep your composure, smile, focus on analyzing the speaker not the message, and you’ll win the argument. An ad hominem attack against an intellectual, not against an idea, is highly flattering. It indicates that the person does not have anything intelligent to say about your message.

I often hear people say, “Of course there are limits to our knowledge,” then invoke the greater uncertainty principle as they try to explain that “we cannot model everything”— I have heard such types as the economist Myron Scholes say this at conferences. But I am sitting here in New York, in August 2006, trying to go to my ancestral village of Amioun, Lebanon. Beirut’s airport is closed owing to the conflict between Israel and the Shiite militia Hezbollah. There is no published airline schedule that will inform me when the war will end , if it ends. I can’t figure out if my house will be standing, if Amioun will still be on the map— recall that the family house was destroyed once before. I can’t figure out whether the war is going to degenerate into something even more severe. Looking into the outcome of the war, with all my relatives, friends, and property exposed to it, I face true limits of knowledge. Can someone explain to me why I should care about subatomic particles that , anyway, converge to a Gaussian? People can’t predict how long they will be happy with recently acquired objects, how long their marriages will last, how their new jobs will turn out, yet it’s subatomic particles that they cite as “limits of prediction.” They’re ignoring a mammoth standing in front of them in favor of matter even a microscope would not allow them to see.

Half the time I am shallow, the other half I want to avoid shallowness. I am shallow when it comes to aesthetics; I avoid shallowness in the context of risks and returns. My aestheticism makes me put poetry before prose, Greeks before Romans, dignity before elegance, elegance before culture, culture before erudition, erudition before knowledge, knowledge before intellect, and intellect before truth. But only for matters that are Black Swan free. Our tendency is to be very rational, except when it comes to the Black Swan.

What I've Been Reading

The Undercover Economist Strikes Back: How to Run-or Ruin-an Economy by Tim Harford.

Macroeconomics is hard. You have ten billion distinct varieties of product, seven billion people, countless unobservable transactions. 2 The economy is shaped by psychology, history, culture, unforeseeable new technologies, geological and climatic events, computer trades too quick for humans to perceive, and much else. It is a dizzying, imponderable problem. No wonder we struggle.

Tim does an excellent job of explaining macro economics concepts in a simplified Q&A format while following Einstein's heuristic. And Tim's sense of humor makes it more fun:

When Nicolas Sarkozy was president of France he commissioned three renowned economists, Joseph Stiglitz (a Nobel laureate), Amartya Sen (another Nobel laureate) and Jean-Paul Fitoussi, to contemplate alternatives to GDP. One possible reason for President Sarkozy’s enthusiasm was surely that the French spend most of their time not working, and this lowers France’s GDP. The country is likely to look better on most alternative indices. It’s not unreasonable to look at those alternatives, but let’s not kid ourselves: politicians are always on the lookout for statistical measures that reflect well on them.

You cannot find a better book to understand macroeconomics - highly recommended. 

Dan Ariely on 23andMe and the Burden of Knowledge

Does 23andMe have an obligation to be better with the information.
I think that they want to get better at it. It’s their mission to get people to make better decisions. In the realm of information that is frightening and worrisome, that’s not an easy thing to do. I met people in 23andMe and they are interested in the well-being of their users. When we did the tests with the people in my research  lab I sent a report to them with our thoughts. My sense is that their heart is in the right place. From my perspective, doing the right thing and profiting form it is perfectly fine. It’s a simple starting point they began with: just give people the information and they’ll be better off with it. Now 23andMe need to refine their use of data. They have to have behaviorists on their staff and use them to make the information more useful. If you think you can just give people information and expect good response, no way. It’s way too much information and it is too expensive emotionally.

So how can they start to get better?
If I were their advisor I would make decisions for people. If the test reveals that you have a relatively high chance of colon cancer, but you can’t do anything about it, maybe we don’t even tell you that, but for sure not lead with this news front and center. But, if results suggest that you have a moderate chance of diabetes that you can control by changing behavior, I would emphasize that. I would lead with the family history and genetic mapping. It’s popular and less controversial. Next I would offer information and general suggestions for how you could improve life expectancy and quality of life, based on results that are actionable. Then, I would create another layer that would cost more to access and in that layer I would give all of the detailed information, including information about things that are largely out of your control. I would make that layer cost more because I want people to make an active choice to get that level of information. I basically want to make sure that people who go for that level of information want to invest in the burden of knowing. Even with all of this, I still think that the information communicated has to be better.

It sounds like this maybe shouldn’t be a consumer product yet?
I’m a big believer in technology and I think if it’s done right 23andME is a great product. I worry a lot that people don’t think about the future enough, and the lack of thinking about the future is a big part of my research. I think the ability to get people to look at the future in a meaningful way and help them shape it, could be very powerful. The promise is tremendous, the execution right now is not my favorite. I don’t’ want people to have the burden of information. I don’t want to frighten people. I don’t want to make them unnecessarily worried. And I suspect that simply giving people all the information will get them to act in all kinds of ways that aren’t optimal.

- More Here

What I've Been Reading

The Man Who Lied to His Laptop: What Machines Teach Us About Human Relationships by Clifford Nass and Corina Yen.

A colleague of mine recommended this book but even before reading it I said - "The influence of Daniel Kahneman's wisdom will far reaching effects in all our lives." 

This book captures zillion social science experiments and its worth a read if haven't read any psychology books in a decade or so.

So here are few reviews of Daniel Kahneman's book Thinking, Fast and Slow which come out in 2011:

David Brooks, NYT:
I’d like to use this column not to summarize the book but to describe why I think Kahneman and his research partner, the late Amos Tversky, will be remembered hundreds of years from now, and how their work helped instigate a cultural shift that is already producing astounding results.

The Economist:
As Copernicus removed the Earth from the centre of the universe and Darwin knocked humans off their biological perch, Mr Kahneman has shown that we are not the paragons of reason we assume ourselves to be. Often hailed as the father of behavioural economics (with Tversky as co-parent), his work has influenced a range of disciplines and has even inspired some policy. But the true consequences of his findings are only starting to emerge. When he presents the poor victims of his experiments with conclusive proof of their errors, the typical reaction is not a chastened pledge to shape up, but confused silence, followed by business as usual. No one likes to be told he is wrong.

New Yorker:
It’s impossible to overstate the influence of Kahneman and Tversky. Like Darwin, they helped to dismantle a longstanding myth of human exceptionalism. Although we’d always seen ourselves as rational creatures—this was our Promethean gift—it turns out that human reason is rather feeble, easily overwhelmed by ancient instincts and lazy biases. The mind is a deeply flawed machine.

This new book will certainly accomplish that—Kahneman has given us a new set of labels for our shortcomings. But his greatest legacy, perhaps, is also his bleakest: By categorizing our cognitive flaws, documenting not just our errors but also their embarrassing predictability, he has revealed the hollowness of a very ancient aspiration. Knowing thyself is not enough. Not even close.

What Behavioral Economics Is Not

The first misconception, that “behavioral economics is about controlling behavior:”:

Some people are worried that behavioral economics will be used, whether by corporations or the government, to control behavior. …What distinguishes the behavioral toolset, however, is that so many of the tools are about helping people to avoid making a decision that they themselves would consider a mistake. Elderly Americans who enroll in Medicaid Part D private drug plans are asked to choose from over 40 options. An intervention that reduced this overload – sending enrollees a letter with information about three alternative plans that would be cheaper for them — nearly doubled the proportion of enrollees who decided to switch plans… and saved $150 per year on average for each person who switched.

The point?

…the most interesting and innovative tools are those that make it easier for people to do what they already want to do — to realize their own good intentions.

The second common misconception, that “behavioral economics is liberal (or conservative)”:

…behavioral economics is being picked up and used everywhere. When liberals are in power, it’s used by liberals. When conservatives are in power, it’s used by conservatives. In fact, the political party that has most embraced behavioral economics is UK Prime Minister David Cameron’s Conservative Party…

Furthermore, while Cass Sunstein may have served as the “Nudger in Chief” during the Obama administration, the only US presidential candidate to have published an academic paper on behavioral economics is a Republican, the former governor of Arkansas, Mike Huckabee.
But there’s a reason why BE’s acceptance is politically wide-ranging:

…behavioral economics appeals to pragmatists and realists because it simply provides a set of tools. It does not rely on heavy-handed state solutions, or on the conceit that people are best left to their own devices. …Savings defaults can raise retirement savings without increasing payroll taxes. Social norm messages can reduce energy use without imposing a carbon tax. “Behaviorally” designed stimulus packages can be as effective for less money.

The final misconception the essay discusses, that “behavioral economics is about irrationality.”:

Rationality has a very specific meaning within economics; it refers to a set of mathematical assumptions economists use to describe our preferences, and how they lead to actions. …When economists use the term “irrational” they mean something very different than how we use it in everyday conversation. …Economic “irrationality” has more in common with irrational numbers (such as pi or √2) than it does with Tom Cruise, Charlie Sheen, or Miley Cyrus.

On the other hand, behavioral economics is built upon psychology, not mathematics. We know that our preferences do not necessarily determine our actions. Psychologists study the brain as it is, rather than trying to assume away the messy details.

When people label human behavior as “irrational,” they are “assum[ing] away the messy details.” Behavioral economics avoids this mistake because of its recognition that context heavily affects the way we make decisions and take action. And the traditional model of decision-making cannot account for the infinite complexity of context.

We believe that people are usually very clever. But the human brain is not a perfect problem solver in all situations. So when someone makes a mistake, it’s important to understand the context that led that mistake to happen. From this, patterns begin to appear. People are not consistently lazy, or stupid, or hot-tempered. But in specific situations they may appear to be so. And though these errors are systematic, the successes are as well. So behavioral economists look for examples of both.

- More Here

Delayed Gratification Hurts Climate Change Cooperation

My colleagues from UBC, the Max-Planck-Institute for Evolutionary Biology, and the Max-Planck-Institute for Meteorology, and I published a study this week in Nature Climate Change where we show that when the rewards of cooperation are delayed, cooperation significantly declines. We used a 6-player collective risk game—a variant on the threshold public-goods experiment, which requires a minimal investment into the common pool (in our case 120 Euros) for the public good to be provided (in our case, an additional 45 Euros each). No single player is capable of ensuring the group's success, and a majority of players who donate nothing guarantees that the target cannot be met. As an environmental scientist interested in large-scale social dilemmas, like overfishing and climate change, this set-up is perfect to explore some of the nuances of cooperation.

- Jennifer Jacquet on Edge