Bryan Caplan on Preferences Over Beliefs

Responding to the criticism mentioned in the previous post, Caplan begins by noting that it is quite possible to observe preferences:

I observe one person’s preferences every day—mine. Within its sphere I trust my introspection more than I could ever trust the work of another economist. Introspection tells me that I am getting hungry, and would be happy to pay a dollar for an ice cream bar. If anything qualifies as “raw data,” this does. Indeed, it is harder to doubt than “raw data” that economists routinely accept—like self-reported earnings.

One thing my introspection tells me is that some beliefs are more emotionally appealing than their opposites. For example, I like to believe that I am right. It is worse to admit error, or lose money because of error, but error is disturbing all by itself. Having these feelings does not imply that I indulge them—no more than accepting money from a source with an agenda implies that my writings are insincere. But the temptation is there.

After this discussion of his own experience, he considers the experience of others:

Introspection is a fine way to learn about your own preferences. But what about the preferences of others? Perhaps you are so abnormal that it is utterly misleading to extrapolate from yourself to the rest of humanity. The simplest way to check is to listen to what other people say about their preferences.

I was once at a dinner with Gary Becker where he scoffed at this idea. His position, roughly, was, “You can’t believe what people say,” though he still paid attention when the waiter named the house specialties. Yes, there is a sound core to Becker’s position. People fail to reflect carefully. People deceive. But contrary to Becker, these are not reasons to ignore their words. We should put less weight on testimony when people speak in haste, or have an incentive to lie. But listening remains more informative than plugging your ears. After all, human beings can detect lies as well as tell them. Experimental psychology documents that liars sometimes give themselves away with demeanor or inconsistencies in their stories.

Once we take the testimony of mankind seriously, evidence of preferences over beliefs abounds. People can’t shut up about them. Consider the words of philosopher George Berkeley:

“I can easily overlook any present momentary sorrow when I reflect that it is in my power to be happy a thousand years hence. If it were not for this thought I had rather be an oyster than a man.”

Paul Samuelson himself revels in the Keynesian revelation, approvingly quoting Wordsworth to capture the joy of the General Theory: “Bliss was it in that dawn to be alive, but to be young was very heaven!”

Many autobiographies describe the pain of abandoning the ideas that once gave meaning to the author’s life. As Whittaker Chambers puts it:

“So great an effort, quite apart from its physical and practical hazards, cannot occur without a profound upheaval of the spirit. No man lightly reverses the faith of an adult lifetime, held implacably to the point of criminality. He reverses it only with a violence greater than the faith he is repudiating.”

No wonder that—in his own words—Chambers broke with Communism “slowly, reluctantly, in agony.” For Arthur Koestler, deconversion was “emotional harakiri.” He adds, “Those who have been caught by the great illusion of our time, and have lived though its moral and intellectual debauch, either give themselves up to a new addiction of the opposite type, or are condemned to pay with a lifelong hangover.” Richard Write laments, “I knew in my heart that I should never be able to feel with that simple sharpness about life, should never again express such passionate hope, should never again make so total a commitment of faith.”

The desire for “hope and illusion” plays a role even in mental illness. According to his biographer, Nobel Prize winner and paranoid schizophrenic John Nash often preferred his fantasy world—where he was a “Messianic godlike figure”—to harsh reality:

“For Nash, the recovery of everyday thought processes produced a sense of diminution and loss…. He refers to his remissions not as joyful returns to a healthy state, but as ‘interludes, as it were, of enforced rationality.'”

One criticism here might go as follows. Yes, Caplan has done a fine job of showing that people find some beliefs attractive and others unattractive, that some beliefs make them happy and some unhappy. But like C.S. Lewis, one can argue that this does not imply that this is why they hold those beliefs. It is likely enough that they have some real reasons as well, and this means that their preferences are irrelevant.

One basis for this objection is probably the idea that sitting down and choosing to believe something seems psychologically implausible. But it does not have to happen so explicitly, even though this is more possible than people might think. The fact that such preferences can be felt as “temptations,” as Caplan puts it in describing his own experience, is an indication that it is entirely possible to give in to the temptation or to resist it, and thus that we can choose our beliefs in effect, even if this is not an explicit thought.

We could compare such situations to the situation of someone addicted to smoking or drinking. Let’s suppose they are trying to get over it, but constantly falling back into the behavior. It may be psychologically implausible to assert, “He says he wants to get over it, but he is just faking. He actually prefers to remain addicted.” But this does not change the fact that every time he goes to the store to buy cigarettes, every time he takes one out to light it, every time he steps outside for a smoke, he exercises his power of choice. In the same way, we determine our beliefs by concrete choices, even though in many cases the idea that the person could have simply decided to choose the opposite belief may be implausible. I have discussed this kind of thing earlier, as for example here. When we are engaged in an argument with someone, and they seem to be getting the better of the argument, it is one choice if we say, “You’re probably right,” and another choice if we say, “You’re just wrong, but you’re clearly incapable of understanding the truth of the matter…” In any case it is certainly a choice, even if it does not feel like one, just as the smoker or the alcoholic may not feel like he has a choice about smoking and drinking.

Caplan has a last consideration:

If neither way of verifying the existence of preferences over beliefs appeals to you, a final one remains. Reverse the direction of reasoning. Smoke usually means fire. The more bizarre a mistake is, the harder it is to attribute to lack of information. Suppose your friend thinks he is Napoleon. It is conceivable that he got an improbable coincidence of misleading signals sufficient to convince any of us. But it is awfully suspicious that he embraces the pleasant view that he is a world-historic figure, rather than, say, Napoleon’s dishwasher. Similarly, suppose an adult sees trade as a zero-sum game. Since he experiences the opposite every day, it is hard to blame his mistake on “lack of information.” More plausibly, like blaming your team’s defeat on cheaters, seeing trade as disguised exploitation soothes those who dislike the market’s outcome.

It is unlikely that Bryan Caplan means to say your friend here is wicked rather than insane. Clearly someone living in the present who believes that he is Napoleon is insane, in the sense that his mind is not working normally. But Caplan’s point is that you cannot simply say, “His mind is not working normally, and therefore he holds an arbitrary belief with no relationship with reality,” but instead he holds a belief which includes something which many people would like to think, namely, “I am a famous and important person,” but which most ordinary people do not in fact think, because it is obviously false (in most cases.) So one way that the person’s mind works differently is that reality doesn’t have as much power to prevent him from holding attractive beliefs as for normal people, much like the case of John Nash as described by Caplan. But the fact that some beliefs are attractive is not a way in which he differs. It is a way in which he is like all of us.

The point about trade is that everyone who buys something at a store believes that he is making himself better off by his purchase, and knows that he makes the store better off as well. So someone who says that trade is zero-sum is contradicting this obvious fact; his claim cannot be due to a lack of evidence regarding the mutual utility of trade.

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