Thought Experiments


I was just discussing with a friend a thought experiment I put together years ago during a debate on whether or not inequality is a prerequisite to economic exchange.

The claim I heard from some economists was that you can't have trade without inequality. While I believe inequality is inescapable, natural, not undesirable, and an inevitable outcome of freedom and prosperity, I don't think it is logically necessary in order for mutually beneficial trade to occur.

I emphasize logical, because thought experiments can be useful for finding errors in reasoning, but they are almost never useful for finding better explanations for the real world. I think I can construct a thought experiment that reveals that inequality is not logically necessary for win-win trade, but that doesn't do much to improve understanding of the world. In the real world, everyone is unequal, period. We differ in taste, preference, ability, biology, etc. Even small divergence leads to different subjective valuations which is the major driver in gains from trade.

The point of the claim that inequality is needed for trade is to reveal that, for from being a danger to be feared, it's a necessary part of human flourishing. That is true. Still, I don't think it is logically required for trade to occur.

Here's my thought experiment:

Two perfectly identical people live on an island. To survive, they need both fish and berries in their diet. Both have identical preferences for types of work, and identical abilities at fishing and berry picking.

In 1/2 a day, one can collect 100 berries, and in 1/2 a day one can catch 2 fish. So each individual splitting the day between berries and fish will end up with 100 berries and 2 fish, for a combined total of 200 berries and 4 fish.

But there are more abundant berries high up on the mountain. The catch is it takes an entire day to get there and back, leaving no time for fishing. And there are more fish deeper in the ocean, but it takes an entire day to paddle there and back leaving no time for berries.

The two identical people could specialize. One spends the whole day fishing in more abundant waters and catches 6 fish. One day one spends all day in more abundant berry bushes and picks 300 berries. They can trade and end up with 150 berries and 3 fish each. Both individuals have gained (50%!) from the trade due to division of labor.

This does not require either individual to become more skilled than the other at one task. They could alternate each day who does which and still win. Division of labor and specialization coupled with trade is a better outcome than self-sufficiency even for two completely equal individuals because of the uneven nature of production itself. Each unit of time does not produce an identical outcome, and duration spent at a task may affect the marginal productivity, even without new skills gained or new capital employed.

See, trade is beneficial even in a world of perfect equality!

The problem is every assumption in the thought experiment is far fetched beyond belief. It can reveal an error in the logic of the original claim, but not its reality. Trade always arises between unequal partners because no two people are equal in the real world. Even identical twins stranded on an island aren't. Even engineered clones under my scenario wouldn't be, because in reality they would enhance their skill with more time invested in one task than another.

Thought experiments are not "gotcha" moments for real world claims. They may be mild rebukes of the certainty of the logical necessity, but they are so divorced from the real world, and so stripped of variables that they allow the real world to contradict them all the time.

Just ask those economists who couldn't imagine any logical way lighthouses could be funded without government even while the very lighthouses outside their window were funded without government.

Thought experiments are fun and sometimes useful, but also often arrogant, blinding, and dangerous.

Update: I just noticed a "Related Post" under this from three years ago. About this exact same thing. I don't even remember writing it. Daily blogging will do that sometimes. Anyway, here it is.

 

Medical History Haiku


In one hundred years

Current medical ideas

Will seem barbaric

Stupid Things


I just watched some guys on YouTube eat a whole pineapple, skin and all.

Apparently pineapple exteriors have an enzyme that digests protein and basically tenderizes the inside of you mouth and later your digestive system - it digests you while you digest it. These guys were bleeding from the mouth by the time they were done.

Of course this looks like a stupid thing to do. But it also has some strange appeal, just like the stunts on MTV's Jackass. Or climbing Everest for that matter.

Humans want to know.

We want to see firsthand (or at least secondhand) what happens when you do this to that. Watch kids mess around with household objects. They always eventually do something stupid with them.

This is a wonderful trait. It can lead to tragedy, but it is also the most human, fully alive kind of activity, and it pushes humanity forward.

We want to go to Mars because it's there. We want to know what will happen. We have to try it.

The kids doing pineapple challenges are channeling the same spirit that drives us forward. When we're interplanetary, you can thank them. (If they're still alive.)

Inner Game of Startups #42: Controversy, money, and vision


This week I talk about the balance between a personal brand and a company brand, how to not get sucked into current events, and why startups can fail due to too much vision and too much money.

Read it and all issues here.

The Obsessive Tendency to Turn Everything Into a Game


I can't seem to help turning things into games.

I tell myself I'm going to go for a leisurely swim and just go as long as I feel like. Pretty soon I'm counting laps, counting strokes per lap, and giving myself little challenges to meet.

It's like this when I shoot hoops, vacuum the floor, wash the dishes, sit by a fire, or respond to emails. It doesn't matter what it is, I almost always end up gamifying it.

I'm not sure if this is good or bad or a bit of both. I mean games are definitely good sometimes, especially for really monotonous tasks. But the games aren't necessarily fun. Sometimes they are, but mostly they're a result of some kind of OCD tendencies I have to quantify and patternize every task and always - always - find ways to do it better or faster, even when that has no bearing on the outcome or when the entire goal of the activity was just to relax.

Occasionally I can just doing things without little sub-tasks and challenges within, and it's kind of nice to have an open-ended, non-timebound experience, where the activity is one whole rather than a bunch of parts. Writing is one of the few things I can do that way (though I often gamify that too).

I'm not sure if I do this because it reduces the scope of the goals to nearer term, or because it keeps me from getting bored, or for some other reason I should seek counseling for. Maybe this is universal.

Stories Open Doors


Learning to tell stories is an incredible skill. But learning to think in stories is even more fundamental.

A narrative arc is more memorable and impactful than factual bullets. The ability to create narratives is what allows attracting friends, collaborators, investors, customers, and fans.

Storytellers are interesting people who get interesting opportunities. Not just those who tell anecdotal tales, but those who weave all of life into layers of narrative. The price of wheat is not merely an economic fact, it's part of a story that started somewhere and will end somewhere. And it's probably nested in other stories.

But telling stories starts with thinking in narrative arcs instead of dots.

I've seen this illustration several times (I'm not sure the origin):

Data To Wisdom Via Information, Knowledge & Insight ...

These are all different ways to see facts. But none of them weave a story. There's no narrative in the dots or the colors or the lines or the connections or paths. They are facts with relationships, but they stop short of a narrative arc. Yes, there is wisdom in seeing that point A follows a path to point B. But why? How? For what purpose? What happened when the path was completed? What was going on before?

A narrative thinker will see these facts and be able to construct a story - a beginning, middle, and end - with motivations and purpose involved. Stories have teleology, facts do not.

The ability to see a meaningful story in any person, event, or series of facts leads to the ability to communicate in narratives. You can connect dots for reasons, and show the future if the dots continue to connect.

Thinking in story helps you be more interesting because it helps you be more interested.

When someone tells you, "I'm an engineer", instead of filing this as a fact in your mental Rolodex, you immediately want to know the story. How did they end up an engineer? Is this the end of a long journey, the beginning of a new story, or the middle? Curiosity drives you to ask good questions, good questions make connections, and connections lead to opportunities.

Discovering, telling, and re-telling your own story is a great place to start. Why are you sitting there reading this right now? What led you here? Why? What does it mean for the future?

Alternating Energies


I've discovered I have the best weeks when I can alternate frenetic days with deep dive days.

Several days in a row of either deep work (writing, thinking, planning) or loud work (people, podcasts, emails, tasks) and quality declines. But If I can have a single day of lots of calls and being "on" with other people, followed by a day doing mostly alone work, I get the best of both.

I can pour myself into the demanding work knowing tomorrow will be a respite. As I've gotten older, I definitely prefer the quiet work to the loud, but I need the loud stuff in some minimum quantity, and my work requires it more than that anyway. So I try to carve out days or half days in between the loud work to have plenty of quiet work.

Both types of work require energy, and both can give energy back if done right, but switching between energy states is optimal for me.

Keeping Focus Without Retreatism


I wrote yesterday about the information war. We're bombarded with so much information if we are tuned in it's impossible to think.

But I don't think the long-term solution is total retreat from the world at large, or what Venkatesh Rao calls Waldenponding.

The bad information experience is like artillery perpetually pounding around you, driving you mad. But there's another kind of information experience that's more like a constant stream. It flows endlessly, every moment bringing past new things. You can wade in, you can get refreshed by it, you can have fun, catch valuable bits, and you can also drown. But the info stream is not inherently hostile or trying to make you useless like the info artillery. You can step back onto the banks and just observe without getting immersed. You can contribute to it, consume from it, or use it for inspiration to create.

The info stream has always existed, even before computers and cell phones, radio and TV. It's the scuttlebutt, the gossip, the collective conversation we call culture. It's trends, fads, ideas, fashions, commerce, and events constantly moving around us.

The digital world has broadened the stream to include more participants, and the flow is faster than ever. But each individual also has more control over their experience of the stream, how they consume, and especially how they contribute.

Waldenponding sounds both difficult and welcome when under constant fire by the info artillery. If only we could go screenless and escape, we'd become whole beings and achieve spiritual enlightenment, we think. But I think the urge to retreat entirely is another form of delusion, less dangerous perhaps than the delusion of thinking it's all real and urgent and important, but a delusion nonetheless.

It makes more sense to take control of your relationship to information, rather than be controlled by it or completely shielded from it.

First, get the hell out of the bullshit battlefield. Don't let yourself be bombarded. Don't sit there and get shelled to oblivion. Get away from the noise and chaos and need to always know the news and have an opinion.

Breathe.

Maybe wander the quiet woods for a bit after leaving the battlefield. When you're ready, approach the stream. Look at it as something beautiful and fascinating. Respect it as something powerful and dangerous. Wade in from time to time as you are able without getting swept away. You'll get stronger and form a better relationship to the stream over time. Make it a part of your existence that serves you, not the other way around.

And when you realize it's pulled you under, or that you've wandered away from the stream metaphor altogether and are back on the battlefield, exit again. Go back to the woods.

Metaphors are how we make meaning. The conscious navigation away from a battlefield to a stream can help reset your engagement with the world of endless information. At least it does for me.

Isaac Morehouse


Isaac Morehouse is the CEO of Crash, the career launch platform, and the founder of Praxis, a startup apprenticeship program. Isaac is dedicated to the relentless pursuit of freedom. He’s written some books, done some podcasting, and is always experimenting with self-directed living and learning.

Featured on -

Looking for something?


Blog Archives

Archives

Small Moves to Setup Big Moves


When opportunity avails itself you're either ready to big seize it, little seize it, or miss out entirely.

It's easy to see someone who makes a big move to nab a big opportunity and think it was luck or good timing alone. But it's not the moment that matters most, but the buildup.

If you constantly make little moves that get you better and better positioned in case of opportunity, you'll be able to make big moves when it comes. This seems obvious, but it's very hard to do.

During no-opportunity times you look around and see no great big moves to make. True. Frustrating. But if you keep looking and thinking about future scenarios, you can spot steady small moves that will compound, each shifting just a bit more of your resources into position to take advantage if big opportunity should emerge. Each small move gets max leverage when opportunity comes, and the little opportunity costs of those little moves comes back and a whole lot more.

Don't worry about how you missed out on big opportunity, or how you don't see it around you. Make small moves to be in position and get your mind ready. It will come.

Assumption of Audience


A lot of misunderstanding and offense online comes from assuming the audience.

When we read posts, we tend to assume we are the audience. When the content doesn't fit us, we assume it's wrong.

Whenever I witness this, I think of the scene in Star Wars, "This is not the post you are looking for". If it doesn't click for you, move on. It's probably not for you. Whether positive advice that seems dumb to you, or a negative attack that seems incorrect to you, odds are it's between two parties you don't understand and they aren't writing with you and your situation in mind.

Trying to educate the poster on your situation and let them know they their content doesn't fit it is almost never a good idea. Because they assume you're part of their audience too. And if you say, "Hey, I'm not your audience but I don't agree with this", it signals a waste of both of your time.

Before you respond, ask yourself who the intended audience is. It helps.

Antagonism and Action


One of the most useful methods I've found to get closer to actionable truth is by creating (non-hostile) antagonism.

If I'm unsure about options, I will pick one and act as if it's true. I'll argue in favor of it as if it's the only way. I'll make the best, strongest arguments for it I can, and won't hedge. This requires someone else to take up the opposite position, if nothing else just to get it a fair hearing. But I'm gonna come on strong, so they are going to have to bring the strongest arguments to match.

With two people fully going to bat for the two positions, the truth is more likely to reveal itself far faster than if we just dance around the weaker "on the one hand but on the other hand" stuff.

Not only does going all in on one position draw out useful arguments from others for the alternate position, but it lets me test drive being a devotee of my position and see if it resonates with my gut. The most important truths are those you just know with your knower, even if you can't consciously articulate or understand why. Indecision is when that gut feeling isn't strong enough either way to cut through the intellectual pros and cons. Examining positions objectively at a distance is an intellectual exercise that doesn't always help discover the gut feeling.

But putting on a position like it's true and going all in gives a taste of what it feels like to live in that reality. The gut gets a chance to scream "this feels off" or "Yes, this is right!"

The hard part about this approach is that it can feel shocking or disheartening or overwhelming to people if they aren't used to it. I grew up in a loud, talkative, interrupting, arguing household. To me, disagreeing is not offensive. There's nothing personal about attacking each others arguments within a trusted context. But I've learned over the years this is not normal and I often end up bowling over people and they just yield to my pigheaded arguments...even if I'm just test driving them myself.

I've tried to ease back some, but mostly to collaborate with people who can get down with strong argument as a form of truth discovery.

PS - I find this works really well for action items. I do not like this approach for discovering philosophical, moral, or abstract truth.

Father’s Day Haiku


It's a lot of work

To let kids do things for me

Here goes Father's Day!

TK Coleman – Virtue Signalling and Corporate Activism Aren’t the Enemy


Had another great chat with TK about alot going on in the world today.

We chat about his beef with free-market advocates who fail to see when the market is winning and instead fear what it might produce.

We dive into companies responding to social outrage, whether it's a worrisome sign of mob mentality or a positive process for truth discovery, and a whole lot more.

Audio version here (and on all podcast platforms under The Isaac Morehouse Podcast)

https://soundcloud.com/isaacmorehouse/tk-coleman-virtue-signalling-and-corporate-activism-arent-the-enemy

 

Video version here:

https://youtu.be/LZTSGQeGlr4

 

Isaac Morehouse


Isaac Morehouse is the founder and CEO of Praxis, a startup apprenticeship program making degrees irrelevant for careers. Isaac is dedicated to the relentless pursuit of freedom. He’s written some books, done some podcasting, and is always experimenting with self-directed living and learning.

Featured on -

Occasional Email Updates

[mc4wp_form id="3197"]

Looking for something?


Blog Archives

Archives