Class Warfare Blog

March 27, 2018

Determinism and Free Will

Filed under: Economics,Philosophy,Science — Steve Ruis @ 12:10 pm
Tags: , , , ,


I have written more than a little about free will and this post is a supplement to that. I have been reading a little about the alternatives to free will, primarily determinism, which is a claim that every decision we make is caused by events outside of our control. I have no problem with that argument, just the driving of it home saying that Determinism Rules, Dude! I think this is yet another example of human exuberance to come up with an answer when we are not yet ready for one. This is my position of free will, too. I think most decisions are made sub- or unconsciously and we understand so little about those processes that to exclude them from discussions of free will thwarts any chance at a reasonable conclusion.

So, are all of our decisions caused? Are our behaviors ruled by the “cause and effect” that works so well in the sciences?

I have been reading Nassim Nicholas Taleb’s works. I just finished “Fooled by Randomness” and have started “The Black Swan.” Mr. Taleb (he has a Ph.D. but doesn’t flaunt it) got his start as a financial instruments trader. He points out over and over, that most human activities are ruled by chance, yet we stubbornly refuse to admit that, seeing systems and patterns in behaviors and numbers that we believe show underlying structures that make things like the stock market predictable. He points to daily stock market reports, an example of which is “the market tumbled 1.7 points today, reacting to the announcement that blah, blah, blah.” He says that statements like this makes financial reporters entertainers rather than journalists. The market indices fluctuate during the day and from day to day. All of them fluctuate more than 1.7 points per day, so a change in any index of 1.7 index points cannot be distinguished from noise. Yet we insist on ascribing reasons to these fluctuations. We also know that the ocean’s tides rise and fall twice a day, so measuring the height of the water depends on what time you measure it. We also know that waves create artificial highs and lows that will move a float up and down in mere seconds. No oceanographer would mistake these normal fluctuations for changes that require action (like sea level rise), but we often do in settings like the stock market.

Our brains were shaped by evolution to do some amazing things. Unfortunately some of these things are counterproductive. For example, we judge the likelihood of something happening by the frequency we encounter that thing. This worked really well when we only encountered things in real life, like when was the last time you witness a murder directly, for example? But, we see the evidence of crime after crime on the nightly news day after day and conclude crime is on the increase; it is not; crime reporting on the news is on the increase, crime itself is decreasing and has been for decades. So, it is easy to fool ourselves using our very best mental skills.

One of our strongest mental skills is pattern recognition. It is so strong we see patterns where none exists, even in sets of random dots and numbers. In the case of financial markets we are making an even bigger mistake. In science we postulated first that invisible entities controlled the behavior of natural phenomena (spirits and ghosts). We then had a bunch of people argue that natural phenomena obeyed laws (the law of gravity, conservation of energy, conservation of momentum, etc.) and that the behaviors of physical objects was predictable based upon these laws and so they were! (Damn!) So, we came to believe in physical cause and effect. Now if we apply this belief to social systems, like financial markets and free will, will it also work? Well, the physical laws have an underlying structure that supports those laws existing. Do morals and financial markets and the like have such a basis? I do not think so, but more importantly, if there is it hasn’t been demonstrated that there is. In order to prove that nature was based upon laws, a whole lot of predictions had to be made and prove out to be right before people accepted that a root foundation for physical laws existed and could be relied upon.

But financial markets, well that’s another story. After every catastrophic collapse of some market or other, the market gurus go around and find one of their kind who predicted that the collapse would happen, and hype them as someone with special knowledge. The problem is that at any point in time, every possible outcome is being predicted and no matter what happens, you can find somebody after the fact that will have predicted correctly. This is not a successful prediction. In science, once you work out the laws involved, you can teach them to others and everyone ends up making correct predictions, not just a person here or there.

Human overreach in pattern-recognition puts, I suspect, too much faith in cause and effect, the underlying mechanism of determinism. We know that quantum mechanical effects are far from cause and effect rooted. We know that a great deal is “caused” by randomness. (If you go out to dinner, you are going to eat something. If you go to an Italian restaurant, you are very likely to eat something Italian. If …). Are we ready to conclude that free will is an illusion and all things are determined by cause and effect? I do not think so.


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