![]() Smith, though - curiously - just jumps in and startsĭescribing human moral judgment without any such throat-clearing. ![]() Goals that motivates such a project and distinguishes it from most otherĮthical philosophy. Writing a prelude like this one that explains the difference in outlook and Introspection and examination of the opinions of well-considered men of hisĪnyone writing a book of experimental ethics today would spend a little time Though Smith’s “experimentation” isn’t very rigorous - mostly amounting to The Theory of Moral Sentiments is in this camp, Judgment as a pre-systematization given and trying to describe itsĬontours rather than force it into a rationally-invented mold. “Experimental” ethical philosophy takes a different tack: taking human moral Various ways and then trying to test the soundness of the resulting systems. Therefore much ethical philosophy has involved systematizing morality in In theseĪrguments, showing that some ethical assertion orĮquivalent to showing it to be disproven or wrong. System or that it ought to be systematized. Their arguments is the theory that morality either arises from a When people argue about the application of moral values, usually implicit in Today I’ll share some of my thoughts on volume one of that book, including the surprising context of his “invisible hand” quote. ![]() In fact, a market that makes perfect predictions is a logical impossibility.I have not read The Wealth of Nations, but I’m currently reading Smith’s earlier book, To the extent that markets are reflections of our collective judgment, they are fallible too. But, the theory is more robust than you might think.Īnd yet, a central premise of this book is that we must accept the fallibility of our judgment if we want to come to more accurate predictions. This view, which was the orthodoxy in economics departments for several decades, has become unpopular given the recent bubbles and busts in the market, some of which seemed predictable after the fact. One might expect these markets to improve predictions for the simple reason that they force us to put our money where our mouth is, and create an incentive for our forecasts to be accurate.Īnother viewpoint, the efficient-market hypothesis, makes this point much more forcefully: it holds that it is 'impossible' under certain conditions to outpredict markets. I advocate the use of betting markets for forecasting economic variables like GDP, for instance. My view is that this notion is 'mostly' right 'most' of the time. That’s really what the stock market is: a series of predictions about the future earnings and dividends of a company. It might follow, then, that markets are an especially good way to make predictions. Both are consensus-seeking processes that take advantage of the wisdom of crowds. Or, Bayesian reasoning might be thought of as an 'invisible hand' wherein we gradually update and improve our beliefs as we debate our ideas, sometimes placing bets on them when we can’t agree. Smith’s 'Invisible hand' might be thought of as a Bayesian process, in which prices are gradually updated in response to changes in supply and demand, eventually reaching some equilibrium. Adam Smith and Thomas Bayes were contemporaries, and both were educated in Scotland and were heavily influenced by the philosopher David Hume. … free-market capitalism and Bayes’ theorem come out of something of the same intellectual tradition.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |