A Curious Miscellany of Items Philosophical, Historical, and Literary

Manus haec inimica tyrannis.

Monday, August 30, 2010

Jon Elster, "Sour Grapes"

I now move on to the second of Jon Elster’s books that I proposed to discuss in the previous post. Please note that, since I’ve dropped several names there — and since I’ll likely be dropping some more here — at the end of this post you’ll find a list of readings referred to in both.
Jon Elster, Sour Grapes: Studies in the Subversion of Rationality (Cambridge: Cambridge University Press, 1983).

I claimed earlier that Elster’s work has some possibly very damaging implications for economics as a rational science, particularly economics done in the rational choice tradition.
By “rational choice”, I refer to an approach to economic analysis that takes as its methodological starting point the idea that the preferences of agents are to be viewed as rational, even if they seem prima facie irrational to the third party observer. An example might be the approach of Nobel Prize-winning economist Gary Becker to a phenomenon like addiction: it may seem as if the choices of smokers are irrational, but they begin to make more sense if we view them as rational from the point of view of maximizing one’s present preferences. After all, if the choice of smokers to smoke were completely irrational, then why is it that when the price of cigarettes goes up, their consumption goes down? Economically, there is much about the behaviour of addicts that displays characteristics of rational economic choice.

(I would counter that this is correct to a certain extent, but that addictive products display a notable lack of demand elasticity — although demand falls when prices rise, the reaction of demand to price is much less sensitive than it is with, say, pickles or ice cream. If the price of heroin goes up, although a few addicts may kick, many will simply steal more purses to keep up with the rise in price. Few turn to crime to support their taste for expensive ice cream. There are many good reasons not to accept a rational choice theory of addiction. For an excellent critique, see Rogeberg 2004.)

Satisfying Preferences: Whose? Which?

Ulysses and the Sirens very much concerns the difficulty of whose preferences are to be satisfied. We might say that, in utilitarian or rational choice fashion, the preferences of all agents are to be given equal consideration. But Elster complicates this by showing us that each of those agents is composed of an indefinite number of intertemporal agents with possibly conflicting preferences, and with no clear cut indication of which of these selves is to have normative priority.

Sour Grapes takes things to a deeper level. Whereas economics pretends to be a descriptive rather than a prescriptive or normative science, Elster examines the nature of desires to demonstrate that it might not be so easy for economics to avoid normative prescriptions. To be more clear: whereas economics claims to be concerned with finding the best way of satisfying the preferences of the greatest number of people regardless of what those preferences are, Elster shows that economics cannot avoid making evaluative judgments about people’s preferences.

Economists are too apt to take people’s wants (or the ordering of these wants, in the form of preferences) as brute facts, as given. Their task then becomes the technocratically straightforward one of figuring out how best to satisfy the greatest number of them.
By contrast, Elster shows that not all desires are worthy of being satisfied. Now, on the face of it this is nothing new; moral philosophers have been saying as much since the time of Socrates. But Elster is not just concerned with the immoral nature of some desires. No economist in his right mind denies that satisfying the desires of sadists is on all fours with satisfying the desires of people with less perverted tastes. But the economist will try to parse this in terms of utility: they will say that as a matter of (contingent) fact, one satisfied sadist must mean one or more normal people must be made very dissatisfied victims of the sadists, the predictable result of which would be net disutility. That, they’d say, is why the preferences of sadists should not be satisfied. But notice that they are still taken into account.

This explanatory scheme might give economists some rationale for discriminating against the wants of sadists, although not on the grounds that the desires of sadists were wrong or immoral. After all, if it so happened that sadists and masochists were evenly distributed in the population and could somehow be paired up, the economists might have to revise their judgment, and take the preferences of sadists (and masochists) seriously.

Elster’s critique of preference-satisfaction has less to with variations in the moral worthiness of desires, and more to do with the fact that some desires are to be preferred to others in terms of their rationality. Indeed, his analysis implies that rationality is so easily subverted, that we ought not to put too much stock in the satisfaction of preferences at all, at least not unless we are willing to roll up our sleeves and examine the nature of the preferences we propose to satisfy.

We tend to think that preferences have at least some minimal rational ordering. For example, it is comforting to believe that our preferences obey the law of transitivity: If I prefer A to B, and I prefer B to C, then all things considered I must prefer A to C. Elster presents a variety of situations in which people’s preferences are not transitive in this way.

Path-Dependency and Context Dependency.

Often our preferences are path-dependent in that they are dependent on my previous history of choices and desires. In other words, they depend heavily on the temporal order in which choices are presented. Preferences are also context-dependent in that they are responsive to changes in the situational variables in the choice-context. Path-dependency is evident, for example, in what psychologists call “availability bias”, the observed tendency of people to prefer that which is most recently presented to them over that which was presented to them earlier. I may prefer A to B and B to C, but where C is presented to me after A, I might prefer C. So what is my real preference, the one that economists should be trying to figure out how to satisfy?

Here’s a rather cute example illustrating both path-dependency and context-dependency. Let x = a Vermeer painting, y = a Renoir painting, and z = a Monet painting. One each of x, y and z is up for auction. Let’s assume I have a lot of money, I’m not a huge fan of Impressionism, and that I don’t currently own a painting by any of these artists. Because I am rich and the paintings are for sale, the feasible set is {x,y,z}. In this situation, I have the following preference ordering: x > y > z. But, if the context is one in which a week earlier I inherited my uncle’s Monet painting, then it becomes conceivable that my preference ordering could be z > x > y (because I already have the beginnings of a Monet collection), or possibly z > y > x (because in addition to the beginnings of a Monet collection, I also already have the beginnings of an Impressionist collection).
The point is that our desires and preferences are closely tied to our previous experience and life history. For example, it is highly unlikely that I will have a preference for fine wines if no wine at all has ever passed my lips.

If Ulysses and the Sirens demonstrated the importance of the time dimension in human preference, Sour Grapes demonstrates the importance of how preferences are formed. Hence the title of the book, referring to Aesop’s fable of the fox and the grapes, in which the fox pretends not to care for the grapes that he cannot have, by telling himself that the grapes are in any case sour.

Adaptive Preferences.

Elster brings our attention to a phenomenon similar to sour grapes, which he calls adaptive preferences. The latter differs from the former in the fact that where the fox pretends not to like the grapes he cannot have, a person with an adaptive preference actually prefers precisely that which he can have over that which he cannot. His preferences are formed out of his feasible set of choices.

This is not just a phenomenon of settling for second-best, because it’s not something that is necessarily conscious. Nor is it necessarily a bad thing, for in countless cases it is a healthy response. After all, imagine how unbearable life would be if we continually felt discomfort at not having the things we want, given that we simply cannot have most of the things we want. Our minds tend naturally to tailor our desires to our possibilities and that’s probably a good thing. It seems only reasonable that our preferences be limited to some feasible set of options.

But adaptive preferences can also have a more sinister aspect. A slave for example might come to “prefer” the life of a slave and to “love” his master, because in the absence of other options, he settles for what he has. Does this mean that the “preferences” of slaves ought to be respected? Can such preferences serve as a justification of the institution of slavery? Economists have few resources to answer these questions because they are normative/evaluative.

It is part of the economist’s training not to care about the ethical nature of slavery, but only whether as an institution it is efficient. In assessing this efficiency they will presumably do a calculation of how well it satisfies the aggregate preferences of society, and within this aggregate, for the purposes of calculation, the desires of slaves are on all fours with – count for no more or less than – the preferences of masters. Therefore, if the masters are happy, and the slaves are “happy” (in the adaptive preferences sense of the term), then, other things being equal, there is nothing (economically) wrong with slavery. Luckily for society, most economists have historically found slavery to be an inefficient institution.

I should like to presume, dear reader, that your intuitions accord with mine in finding that the economist misses the main point. The preferences of the slaves, being adaptive in the worst way, have been perverted. Slaves tailor their desires to their feasible set, but that feasible set has been artificially and immorally limited by the masters. The adaptive preferences of slaves should not count in the way that normal preferences count (I am intentionally using evaluative terminology like “worst”, “perverted” and “normal” here, because they don’t scare me in the way they seem to scare economists and other social scientists). As Elster puts it, “my suggestion is that we should evaluate the broad rationality of beliefs and desires by looking at the way in which they are shaped” (p. 15). Much later on in the book, he elaborates this point:

“[W]e should not take wants as given, but inquire into their rationality or autonomy. These, in the general case, are properties that cannot be immediately read off the wants themselves…. Rationality in the broad sense depends on the way in which the states are actually formed. Two individuals may be exactly alike in their beliefs and wants, and yet we might assess them differently from the point of view of rationality, judgment and autonomy.” (p. 140)

I fear I have not managed to do full justice to the genius of Elster’s book. Sour Grapes is really a virtuoso performance, so far-reaching are the topics with which it deals with and the sources upon which it draws. I mentioned in the previous post that Elster is an analytical Marxist. But even a Marxist is capable of speaking good sense from time to time. By way of an ending to this post, here are some other propositions Elster defends in Sour Grapes, propositions that Marxists (and indeed all social scientists) must grapple with:

1. There is no reason to suppose that beliefs shaped by a social position tend to serve the interests of the persons in that position (p. 143).

2. There is no reason to suppose that beliefs shaped by a social position tend to serve the interests of the ruling or dominant group (p. 147).

3. There is no reason to suppose that beliefs shaped by interests tend to serve these interests (p. 156).

4. There is no reason to suppose that beliefs which serve certain interests are also to be explained by those interests (p. 163).

Further Reading

AINSLIE, George. Picoeconomics: The Strategic Interaction of Successive Motivational States within the Person. Cambridge: Cambridge University Press, 1992. [Picoeconomics as a field of study can be thought of as micro-micro-economics. It concerns itself with such phenomena as time-preference, time-inconsistency, and hyperbolic discounting.]

BECKER, Gary and Kevin MURPHY. “A Theory of Rational Addiction,” Journal of Political Economy 96 (1988), 675-700. [Locus classicus for the rational choice approach to addiction.]

BRENNAN, Geoffrey and James M. BUCHANAN. The Reason of Rules: Constitutional Political Economy. Cambridge: Cambridge University Press, 1985. (Reprint, Indianapolis: Liberty Fund, 2000.) [Deals with the political and constitutional dimensions of a “multiple selves” theory.]

ELSTER, Jon. Ulysses Unbound: Studies in Rationality, Precommitment, and Constraints. Cambridge: Cambridge University Press, 2000. [More recent book carrying forward his work in Sour Grapes and Ulysses and the Sirens. He even applies his ideas to film and jazz music.]

ELSTER, Jon (ed.). The Multiple Self. Cambridge: Cambridge University Press, 1987. [A collection of essays by various authors, including Schelling and Ainslie.]

FRANFURT, Harry. The Importance of What We Care About. Cambridge: Cambridge University Press, 1988. [On the difference between first- and second-order desires, or roughly, between desires and values.]

KAVKA, Gregory. Moral Paradoxes of Nuclear Deterrence. Cambridge: Cambridge University Press, 1987.

PARFIT, Derek. Reasons and Persons Oxford: Clarendon Press, 1984. [Presents a utilitarian ethical theory based on a “multiple selves” conception of agency. The gist of Parfit’s position is that utilitarianism should only concern itself with satisfying the desires of present selves. I strongly disagree.]

ROGEBERG, Ole. “Taking Absurd Theories Seriously: Economics and the Case of Rational Addiction Theories,” Philosophy of Science 71 (2004), 263-285.

SCHELLING, Thomas. The Strategy of Conflict. Cambridge, MA: Harvard University Press, 1960. [Book in which Schelling explored the notion of rationally motivated irrationality, especially in the context of relations between nuclear-armed nations. A Cold War classic.]

SCHELLING, Thomas. Strategies of Commitment and Other Essays. Cambridge, MA: Harvard University Press, 2005. [Title essay concerns precommitment.]

THALER, Richard H. and Cass R. SUNSTEIN. Nudge: Improving Decisions about Health, Wealth, and Happiness. New Haven, CT: Yale University Press, 2008. [Applies some grossly oversimplified findings in social and cognitive psychology to problems of rational decision-making. They advocate a position they call "libertarian paternalism", in which the powers that be should design better institutions and choice-situations so that people can make better decisions. After reading it, I was left wondering why they bothered using the descriptor "libertarian".]