“Economics, as it is usually practiced, operates in a purely deductive mode,” he says. “Every economic situation is first translated into a mathematical exercise, which the economic agents are supposed to solve by rigorous, analytical reasoning. But then here were Holland, the neural net people, and the other machine-learning theorists. And they were all talking about agents that operate in an inductive mode, in which they try to reason from fragmentary data to a useful internal model.” Induction is what allows us to infer the existence of a cat from the glimpse of a tail vanishing around a
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