Sunday, October 23, 2005

Paulos correct, but only telling half the story

John Allen Paulos has a history of saying things that while not profound, make an incredible amount of sense. He is someone who has a history of taking a mathematical look at the world, and often hits on really interesting points.

This Article on Intelligent design is a case in point. He pursues a fascinating analogy between the emergence of very efficient free markets and Darwinian evolution. Now when you think about it is not the most profound analogy, they are both things that have naturally emerged. Therefore they naturally have an appearance of efficiency. No one in their right mind would ask who intelligently designed our economy.

Each price is set by market forces. Nothing costs more than people are willing to pay for it. Certainly nothing that any of us use. No one deliberately made sure that every drug store has the toothpaste that most people around there use. If it didn't someone would open up a store that did have it and people would buy their stuff there.

So there is a very clear analogy between an argument for efficiency of free markets and their value, with Darwinian evolution. But here is my problem. Paulos then goes on to marvel that there are all these people who are so anti-Darwin and yet so pro-free market. How could they, he wonders, be so prepared to favor the notion of efficient emerging markets, and yet reject the notion of emergent efficient biological mechanisms.

Now, personally I believe in both - self-organizing markets, and self-organizing biological systems. I think they are both perfectly reasonable explanations for how we get these rather efficient systems, both organic and economic.

But Paulos does not seem at all amazed that there are massive amounts of people out there (mostly called "academics") who think that it is so obvious that the most naive form of Darwinism is true, but vigorously fight and propagandize shamelessly that self-emerging markets are horrible ways to design economic systems, and that the only way to get real efficiency is via central planning.

He does not bother to mention the minions of academics who, since Marx, fought very hard to have an anti-Darwinistic economic notion become mainstream academic thought (at least outside economics departments). And academics, unlike your average anti-Darwinist, should know better.

Paulos is forgetting that analogies are two way streets. Your average academic, if I am not mistaken, thinks that a soviet-style economy, where a central "intelligent" agency simultaneously decided the prices and distribution of millions of goods and services is naturally preferable. There is no spontaneity or emergence in socialist markets, and yet academics have no problem believing that 1) this is the most equitable, and more importantly, 2) this is the most efficient.

So Paulos pointed out a big flaw in the reasoning of those who liked the free market but didn't like Darwinism. He goes so far as to practically mock their inconsistency. But somehow the standard left-wing dogma which is equally inane, goes unmocked. Somehow Darwinism is really the same as free markets, and so anti-Darwinists are dumb. But he feels no need to tell us that the free market is the same as Darwinism and anti-Free marketeers are dumb too. Why can't he say that? It is the natural flip-side.

Somehow when the left and right make the same mistake (which they are both equally dumb for making) only the right gets ridiculed. Sad.


Shosh said...

It's a good article. Did you check out his website? He looks exactly like I'd expect a professor of mathematics to look. I'm sure Paulos wants to keep his job which is why he only implicitly mocks the left-he has to work with these people every day, after all. It's also interesting that in the free market system, one is free to market so sometimes the most common products are not the most necessary or the best of their kind-those who market can always depend on the stupidity of the people they are selling to. And with human evolution, we have some really stupid designs that although they technically work, could probably be a whole lot better (our backs are a good example -bones piled on top of each other with the brunt of the pressure resting on the bottom bone). I woke up with a sore back this morning and cursed my design. I doubt I'd prefer being on all fours, though....

30 something said...

Drug stores are not Darwinian. There is a Darwinian element to the way in which merchandise ends up in a drug store, however that element is limited to natural selection, not random mutation. There is a tremendous input from intelligent agents when it comes to the product lines of drug stores and other stores for that matter, so much so, in fact, that for anyone to claim otherwise suggests to me a fundamental lack of understanding of what it means for something to be truly Darwinian.

The history of the debate regarding the evolution of life is replete with claims that some or another process is Darwinian when, in fact, only part of the story is Darwinian. Stressing natural selection while ignoring random mutation is something that Darwinians commonly do. My guess though is that most of those that are skeptical of Darwinian evolution have no qualms with the idea that natural selection is an important process in biology and in many other realms of science. What most people have a problem with is the idea that random mutation is capable of producing the diversity, complexity and efficiency of life forms that we find around us.

The first time I came across someone playing the “natural selection works therefore Darwin was right” trick was in my first college biology class. The professor was talking about the famous peppered moth. The peppered moth is a whitish moth covered with black spots. This coloration provides an effective camouflage for the moths as they rest on certain Birch trees. These moths can be found in a range of pigmentation from very black to very white and all shades in between. In a much touted study in England it was found that when the white trees, on which the moths rested, became dark from industrial pollution, birds ate more of the lighter moths. It came as no surprise that the population of darker moths increased while the lighter ones decreased. Further, when cities cleaned up their air, the trees got lighter and the lighter moths again predominated. This, the professor insisted, is evidence of Darwinian evolution.

However, the peppered moths effect does not provide support for Darwinian evolution and neither is our economy Darwinian. Both the moths and the economy are Darwinian and not Darwinian in the same way. Paulos asks: “Go into almost any drug store and you can find your favorite candy bar. Every supermarket has your brand of spaghetti sauce, or the store down the block does. Your size and style of jeans are in every neighborhood. Somehow there are enough ball bearings and computer chips in just the right places in factories all over the country. The physical infrastructure and communication networks are also marvels of integrated complexity. Oil and gas supplies are, by and large, where they're needed. Your e-mail reaches you in Miami as well as in Milwaukee, not to mention Barcelona and Bangkok.” He concludes “What would you think of someone who studied economic entities and their interactions in a modern free market economy and insisted that they were, despite a perfectly reasonable and empirically supported account of their development, the consequence of some all-powerful, detail-obsessed economic law-giver? You might deem such a person a conspiracy theorist.”

Of course Paulos is right, but trivially so. Sure god didn’t decide 5000 years ago, or ever, how many white and black moths are going to inhabit any particular habitat. Neither is there some “detail-obsessed economic law-giver” deciding what should and should not be sold in drug stores. Both the moths and the items in the drug store are “naturally selected” via Darwinian processes that operate both in nature and in economics. However to call these Darwinian is to misrepresent to issue entirely.

In the case of the moths the genes for both black and white moths existed before industrial pollution ever came on the scene. All pollution did was to make it more likely that the gene for white coloration was going to predominate in this particular circumstance. However to truly demonstrate Darwinian evolution one would have to show that a Darwinian process created the gene in the first place. In a similar way, for economics to be truly Darwinian the processes that get the product to where it is in the first place need to be random, when in fact they are not.

A better example of a truly Darwinian process is the aids virus which, it seems, is actually able to produce new forms via random mutation. However, my point here is not to criticize evolution or to argue whether random mutation could ever have produced anything truly complex. I simply want to point out that the market place is not Darwinian.

For a drug store to be Darwinian we would need to start out with an assortment products that is truly random. Mink coats, off road vehicles, lathes, transistor radios. Then, depending on the stores success, a random process would change the merchandise in the store. The merchandise that is being bought would stay on the shelves and the merchandise that is not being bought would be replaced in a random fashion for another product. So if people going into a drug store would not, over time, be interested in buying engineering software, that product would be replaced randomly by, say, pocket watches then by something else and so on until finally a product would appear that would be in demand. If as a result of this randomly mutating product line a successful drug store would be produced we could then say that a Darwinian process is at play.

However drug stores do not function this way. There is in fact an intelligent agent that directs the evolution of the product line, making sure revenue is maximized at each step along the way and that each change is as reasonable as possible. Whether any particular change lasts or not will be decided by the forces of natural selection and, indeed, there is no global overseer here. Whether a truly Darwinian process could produce a successful store is an empirical question. Some practical concerns would be, for example, how long would it take for a profitable line up to come about? Would the end result ever resemble a drug store, or would there be a random assortment of unrelated products? Could an organized collection of products within a category be produced (ei 100 toothbrushes to choose from)? Would the store go out of business long before anything useful came about?

Whether this could happen or not is, however, quite besides the point. Economics is not Darwinian but rather is a complex interaction of intelligent agents interacting with Darwinian processes.

Kenny said...

You make it sound as if Paulos suggests that if you "like" free markets then you should "like" evolution, and you want to say it should go in the opposite direction as well. But it sounds to me that he doesn't care whether or not you "like" these things - just that if you think free markets can cause spontaneously emergent efficiency, then you should think evolution could as well. And vice versa. But the academic left that you criticize doesn't doubt this about free markets - they just doubt that it does it in the best way possible. Now of course, what exactly it means to be the best sort of emergent order is completely unclear, and that's a separate story. But (as far as I know) no one thinks that evolution produces complex systems in "the best way possible" (whatever that would mean). I seem to remember Dawkins suggesting at several times in The Selfish Gene that we should try to change our nature and avoid some of the things that evolution has designed us to do. And this is exactly (well, in a weaker sense) what the Marxist says about the things that free markets have made us do.

These critiques suggest that these parallel processes might not always operate for the best, even though they acknowledge that both of these processes operate. However, the caricatured evangelical Republican thinks that only the free market process actually operates, while the evolutionary process doesn't. And the free market process always results in the best outcome. While God was needed for the other one.