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Arthur Koestler wrote an entire book about it, aptly called The Sleepwalkers. It describes discoverers as sleepwalkers stumbling upon results and not realizing what they have in their hands.
We forget about unpredictability when it is our turn to predict. This is why people can read this chapter and similar accounts, agree entirely with them, yet fail to heed their arguments when thinking about the future.
As happens so often in discovery, those looking for evidence did not find it; those not looking for it found it and were hailed as discoverers.
but incremental change has turned out to be generally slower than forecasters expected. When a new technology emerges, we either grossly underestimate or severely overestimate its importance.
A Solution Waiting for a Problem
Engineers tend to develop tools for the pleasure of developing tools, not to induce nature to yield its secrets.
We build toys. Some of those toys change the world.
Louis Pasteur’s adage about creating luck by sheer exposure. “Luck favors the prepared,”
The
best way to get maximal exposure is to keep researching. Collect opportu...
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HOW TO PREDICT YOUR PREDICTIONS!
People who do not really know his work tend to focus on Popperian falsification, which addresses the verification or nonverification of claims. This focus obscures his central idea: he made skepticism a method, he made of a skeptic someone constructive.
Popper’s insight concerns the limitations in forecasting historical events and the need to downgrade “soft” areas such as history and social science to a level slightly above aesthetics and entertainment, like butterfly or coin collecting.
Popper’s central argument is that in order to predict historical events you need to predict technological innovation, itself fundamentally unpredictable.
“Fundamentally” unpredictable? I will explain what he means using a modern framework. Consider the following property of knowledge: If you expect that you will know tomorrow with certainty that your boyfriend has been cheating on you all this time, then you know today with certainty that your boyfriend is cheating on you and will take action today, say, by grabbing a pair of scissors and angrily cutting all his Ferragamo ties in half.
There is actually a law in statistics called the law of iterated expectations, which I outline here in its strong form: if I expect to expect something at some date in the future, then I already expect that something at present.
It can be phrased as follows: to understand the future to the point of being able to predict it, you need to incorporate elements from this future itself.
This incapacity is not trivial. The mere knowledge that something has been invented often leads to a series of inventions of a similar nature, even though not a single detail of this invention has been disseminated—there is no need to find the spies
There may be no plagiarism: the information that the solution exists is itself a big piece of the solution.
By the same logic, we are not easily able to conceive of future inventions (if we were, they would have already been invented).
I find this is true when writing books. If I can conceive an invention, someone has already made it. For instance, I randomly thought of a corn cobber. There are many available. They are usually called corn strippers.
Hmm, I should open a gentleman's club. Surprisingly, there aren't any on Google.
I’ll summarize my argument here: Prediction requires knowing about technologies that will be discovered in the future. But that very knowledge would almost automatically allow us to start developing those technologies right away. Ergo, we do not know what we will know.
Remember the psychological discussions on asymmetries in the perception of skills in the previous chapter? We see flaws in others and not in ourselves.
When mathematicians say “hand-waving,” disparagingly, about someone’s work, it means that the person has: a) insight, b) realism, c) something to say, and it means that d) he is right because that’s what critics say when they can’t find anything more negative.
The Three Body Problem
He introduced nonlinearities, small effects that can lead to severe consequences, an idea that later became popular, perhaps a bit too popular, as chaos theory.
Poincaré’s reasoning was simple: as you project into the future you may need an increasing amount of precision about the dynamics of the process that you are modeling, since your error rate grows very rapidly.
The problem is that to correctly compute the ninth impact, you need to take into account the gravitational pull of someone standing next to the table
Prediction and forecasting are a more complicated business than is commonly accepted, but it takes someone who knows mathematics to understand that. To accept it takes both understanding and courage.
They Still Ignore Hayek
Corporations survive not because they have made good forecasts, but because, like the CEOs visiting Wharton I mentioned earlier, they may have been the lucky ones.
But corporations can go bust as often as they like, thus subsidizing us consumers by transferring their wealth into our pockets—the more bankruptcies, the better it is for us—unless they are “too big to fail” and require subsidies, which is an argument in favor of letting companies go bust early.
one can argue that we know very little about our natural world; we advertise the read books and forget about the unread ones.
It would be preferable if we were better at understanding cancer or the (highly nonlinear) weather than the origin of the universe.
Do nerds tunnel, meaning, do they focus on crisp categories and miss sources of uncertainty?
In reality, languages grow organically; grammar is something people without anything more exciting to do in their lives codify into a book.
Consider again the central planner. As with language, there is no grammatical authority codifying social and economic events; but try to convince a bureaucrat or social scientist that the world might not want to follow his “scientific” equations.
To clarify, Platonic is top-down, formulaic, closed-minded, self-serving, and commoditized; a-Platonic is bottom-up, open-minded, skeptical, and empirical.
The reason for my singling out the great Plato becomes apparent with the following example of the master’s thinking: Plato believed that we should use both hands with equal dexterity. It would not “make sense” otherwise. He considered favoring one limb over the other a deformation caused by the “folly of mothers and nurses.”
The empirics practiced the “medical art” without relying on reasoning; they wanted to benefit from chance observations by making guesses, and experimented and tinkered until they found something that worked. They did minimal theorizing.
Empirics do minimal theorizing. This is an important point. Forming a theory results in confirmation biases where only evidence that supports the theory will be considered.
Campbell's example of collecting mounds of evidence for the China project is a good one.
doctors rejected the practice of hand washing because it made no sense to them, despite the evidence of a meaningful decrease in hospital deaths.
Academic Libertarianism
To borrow from Warren Buffett, don’t ask the barber if you need a haircut—and don’t ask an academic if what he does is relevant.
In academia a tenured faculty is permanent—the business of knowledge has permanent “owners.” Simply, the charlatan is more the product of control than the result of freedom and lack of structure.
Prediction and Free Will
It is another matter to project a future when humans are involved, if you consider them living beings and endowed with free will.
However, if you believe in free will you can’t truly believe in social science and economic projection. You cannot predict how people will act.
You simply assume that individuals will be rational in the future and thus act predictably. There is a strong link between rationality, predictability, and mathematical tractability. A rational individual will perform a unique set of actions in specified circumstances.
In order for social sciences and economics to work, people must be rational and always act in their own self-interests.
I have many gooks I haven't read yet as it gives me a feeling of abundance. It's like knowning I have plenty of food and don't have to ration myself.
Many times people would need to go bankrupt in order to prevent a black swan event from bankrupting them. Is this true, or is it an excuse not to prepare for black swan events?
Platonified economists ignored the fact that people might prefer to do something other than maximize their economic interests.
Plato specified a set of rules people should follow without considering that people would not like to follow them.
