This Thing For Which We Have No Name
"No one ever got fired for buying IBM" is a wonderful example of understanding loss aversion or "defensive decision making". The advertising and marketing industry kind of acted as if it knew this stuff—but where we were disgracefully bad is that no one really attempted to sit down and codify it. When I discovered Nudge by Richard Thaler and Cass Sunstein, and the whole other corpus on Behavioral Economics…. when I started discovering there was a whole field of literature about "this thing for which we have no name" …. these powerful forces which no one properly understood—that was incredibly exciting. And the effect of these changes can be an order of magnitude. This is the important thing. Really small interventions can have huge effects. ...We'll be back with more Rory tomorrow.
***...The strange thing about academics, which always fascinates me, is that they believe they're completely immune to status considerations and consider themselves to be more or less monks. In reality, of course, academics are the most status-conscious people in the world. Take away a parking space from an academic and see how long he stays. I always find this very strange when you occasionally get in the realm of happiness research, you get fairly considerable assaults on consumerism as if it's just mindless status seeking. Now, the point of the matter is, is that academics are just as guilty of the original crime, they just pursue status in a different way. ...
~ ~ ~I have probably stolen, without realizing it, your own job title of "impresario" rather unfairly. The reason I did this was that occasionally people started writing about me online as a "behavioral economist" and I realized that, among academic behavioral economists, this would drive them practically apoplectic to have someone with no qualifications in the field so described. (I'm a classicist by background in any case). So my being described as a behavioral economist would make them practically deranged.
It's not my job to be a behavioral economist; my job is to actually popularize behavioral economics. The interesting thing to me—as someone who has a brother who's an academic—is that academics, however brilliant, are the worst marketers in the world. And there's a reason for this, which is they, of course, possibly rightly, despise the idea of marketing. Their idea is that there is a pure and objective truth and people should appreciate it. As they see it, the way in which you present that truth should be irrelevant to its acceptance. So indifferent are academics to presentation, it seems, that the PowerPoint slide which announced the existence of the Higgs Boson was partly written in the font Comic Sans.
My contention would be that there are ideas which, depending on how you present them—it's rather like the experiment with Wason Cards—may either be easily accepted and understood or are incomprehensible and/or repellant. The reaction to those ideas will entirely depend on how they're framed and presented, and have nothing to do with the objective truth underlying the findings. My personal view, as much as it may seem repellant to them, is that academics actually need impresarios, need marketers, and need popularizers.
The reason I'd happily describe myself as a behavioral science impresario is that many recent insights from six or seven interrelated fields of social science are extraordinarily important in terms of business activity, but more important still, public policy. If those things aren't widely known, appreciated, and understood, and if people aren't allowed to grasp them in the right way, then they will be crudely overlooked. I said elsewhere on Edge that in the social sciences, the good ideas aren't always influential and the influential ideas aren't always good. To have some very, very important ideas from Kahneman, for instance, or Jonathan Haidt from evolutionary psychology…. to have those overlooked or effectively rejected by practical people in positions of power or influence would be really tragic.
I was always taken by the Richard Feynman thing where he said, and I'm paraphrasing, "When you come up with some true thing, you can often find the same truth that's expressible in three or four different ways." And what those four different expressions say is identical in objective reality; however, the kinds of ideas and implications and applications that arise, depending on how you express the truth, are psychologically completely different. Expressing the same thing in four different ways is, in one sense, completely worthless as an activity. On the other hand, in terms of generating further ideas based on those insights, the kinds of things that will be generated will be dependent on how those things are presented. "Therefore psychologically we must keep all the theories in our heads, and every theoretical physicist who is any good knows six or seven different theoretical representations for exactly the same physics." That's a really important thing.
The reason I'd happily describe myself as a behavioral science impresario is that many recent insights from six or seven interrelated fields of social science are extraordinarily important in terms of business activity, but more important still, public policy. If those things aren't widely known, appreciated, and understood, and if people aren't allowed to grasp them in the right way, then they will be crudely overlooked. I said elsewhere on Edge that in the social sciences, the good ideas aren't always influential and the influential ideas aren't always good. To have some very, very important ideas from Kahneman, for instance, or Jonathan Haidt from evolutionary psychology…. to have those overlooked or effectively rejected by practical people in positions of power or influence would be really tragic.
The problem—in terms of understanding human behavior, and I go even further, in understanding economics—is, why is neoclassical economics so disproportionately influential among the social sciences in influencing policy and bank behavior and, indeed, business? I mean, the finance director—the chief financial officer—is now typically the second most powerful person in any organization. He will, unconsciously or not, base quite a lot of his decisions on the unproven assumptions of neoclassical economic theory. So why has neoclassical economics, which is a pretty appalling predictive guide to individual human behavior, achieved this influence? One of the reasons is it's mathematically neat so people just fall in love with the elegance of the thing and are happy to ignore the fact that, empirically, it ain't all that.
Another one, I suspect, is a peculiarity of academics. My brother is an astrophysicist. I once said to him, "Look, you do extraordinarily advanced math about galaxy clustering and such. Why don't you just bugger off to a bank for three years, make a stack of money, and then return with the freedom to do what you like?" And he said, "The problem is, for example, in astrophysics, disappearing off to work in a bank for three years is effectively career suicide." Now, there's one group of academics where working for Citibank for two years on a highly-paid gig is possibly not career suicide, and that would be among economists.
By contrast, I imagine that if you're an anthropologist and you spend three years working for Unilever, it's actually a career setback. My guess would be that if you were a sociologist in 1975 and you went and worked for an advertising agency, you might as well retire afterwards because no one else in academic sociology was going to give you a job. But economics has this disproportionate influence and my mission is to rebalance things a little bit....MUCH MORE
