On The Dunning-Kruger Effect

 

Anyone active on social media will know how flooded society is with absurd, half-baked, ill-conceived theories about how the world works. Our culture is awash with people’s outlandish misunderstandings about faith, politics, economics, the climate - you name it. It’s not just alarming that these views and beliefs veer so far from facts and truth. What's more alarming is that the people subscribing to them do so with the utmost confidence, and not even a flicker of doubt as to whether they are wrong. 

There is a phenomenon that explains this: it’s called the Dunning-Kruger effect, which is basically people’s inability to identify their own inability in rationalising a proposition. Ironically, of course, because the effects of the Dunning-Kruger effect create blind spots that stop people seeing the error of their ways, those most in need of understanding the maladies of the Dunning-Kruger effect are the ones who are least likely to be persuaded by the redress.

What happens with the Dunning-Kruger effect is that people who know only a little about a subject are still too uninformed to realise how incompetent they are, and those who know a lot are the only ones who realise how enlightened they actually are. How this plays out is that it’s the people who most need to learn how incompetent they are that speak with the most confidence, and those who are most expert are the humblest as their prodigious knowledge informs them of how much more there is to know, and how complex the world really is relative to what thy think they understand. This graph wonderfully illustrates the problem:

People start ignorant and know that they know nothing (the bottom left) but then learn a bit about a subject and their confidence skyrockets far too prematurely. This peak is called Mount Stupid, and it is the point at which they are most likely to spout the most nonsense, and join misguided groups associated with hostile atheism, false religions, extreme left or right wing politics, and climate change alarmism, and groups of that kind. Once people get a bit more enlightened, they move down Mount Stupid towards the Valley of Despair. This is where confidence diminishes as knowledge increases – we begin to realise how little we know, and march on upwards along the Slope of Enlightenment, trying to master a subject. Those who reach the Plateau of Sustainability are the ones who can speak with the most justified confidence, as they have the most knowledge.

Alas, it’s those standing at the top of Mount Stupid who shout the loudest, and who dominate our political discourse and our media. It’s the people on Mount Stupid who tell us that belief in God belongs in the Dark Ages; it’s the people on Mount Stupid who think the gender pay gap is unfair and lobby the government to take action; it’s the people on Mount Stupid who obstruct people trying to earn a living because they are convinced there is a climate emergency – the loudest and most confident are the most ignorant.

Here's a reality check: it takes tens of thousands of hours to become an expert in something, and even thousands of hours just to know an awful lot. It takes those thousands of hours to learn that when you’re an expert you still know relatively little compared with what there is still to know. Most people haven’t spent thousands of hours on any subject; and most of the knowledge of the people shouting from Mount Stupid amounts to seeing a few articles online, a few comments below it, a meme, the odd video, Tweet, and maybe a book or two. Those on the Dunning-Kruger peak of Mount Stupid really have no idea how little they understand these subjects.

A further call for epistemic humility is in the fact that the majority of what we know and believe comes from other people – we rely on others by trusting their expertise and by trusting the discipline of their field too. If you only kept things that arrived solely on your own personal experience you would hardly know a thing. Think for a moment about the many things you are quite ‘sure’ are correct and see how much of that knowledge you have first hand experience of. Do you know any of the texts in the Magna Carta or the surveys in the Doomsday Book? Can you close your eyes and visualise the fine details on any of Blake’s Great Red Dragon paintings? Have you ever been to Easter Island? Have you ever seen anyone perform a segmental resection on a tiger or an elephant? Did you know that the album cover on Pink Floyd’s Dark Side of the Moon features the dispersion of light as it travels through a triangular prism? Will you ever physically prove that light being scattered by the prism would produce different visible colours, or will you trust the experts? Will you ever measure the electrostatic force between a nuclei and electrons, or will you just trust the experts that solid objects are made up largely of empty space? I'll bet some of you know that if a DNA molecule is to successfully circularise it must be long enough to bend into the full circle with the correct number of bases which puts the ends in the correct rotation for bonding to occur. But you've probably never observed the difference between the 'axial' stiffness and 'torsional' stiffness of the molecule. 

Those are just a few random and unconnected thoughts about how complex the world is, and how, because of the totality of possible knowledge out there, every single one of us in an amateur when it comes to most things. All of those statements above pertain to true realities in the external world, and I don’t doubt that you could find evidence to demonstrate their validity. But those verified facts are the result of years of hard work from experts in their fields (and of course their great many progenitors too). Most of the people speaking the loudest on Mount Stupid would do well to climb on down, master the subjects on which they pontificate, and come back with better ideas, more humility, and much more respect for the complexity of the subjects on which they think they have informed opinions.

What If Price Robots Could Read Our Mind?

 

Let me start by planting a scenario in your head. Jack and Jill go to the supermarket an hour apart, and they see some pineapples for sale for £1 each. Jack really loves pineapples and would willingly pay £2 for each one. Jill likes pineapples but would only pay £1.30 for each one. Both Jack and Jill each buy three pineapples, and the supermarket takes in £6 of sales. If there was a magic price-setting robot that could adjust the price of pineapples to exactly the most that each customer would willingly pay, then it would charge Jack £6 for three pineapples, and Jill £3.90, meaning supermarket sales of £9.90 rather than £6. In the real world, the supermarket doesn't know in advance what Jack and Jill will each pay, so they both get charged £1 per pineapple, even though they'd both willingly pay more.

Now picture a new scene: this time it’s the year 2045, and the price system is structured rather differently. Whereas once upon a time we would all expect to pay the same price for a pineapple on a supermarket shelf, or a music album on Amazon’s website, these days, in the year 2045, the basis for what individuals are charged for all goods and services is based on their own past consumer habits. In other words, just as the products Amazon shows us in the suggestion bar are based on past consumption, prices too may be dynamically adjusted based on how much we are thought to value something.

The current price system is built on an imperfect approximation of a weighted average of revealed preferences in society. But it does mean that we all get different value for different things. This is revealed in the prices we are willing to pay, and the levels of consumer surpluses enjoyed. That’s why a healthy economy caters for Tom’s love of Star Wars, Dick’s love of model railways and Harry’s love of snooker. Each may hate the other person’s favourite thing, but prices account for all the information signals, as individuals look to maximise their own utility, and are a best approximation of how much to charge for something.

The downside of the price system for suppliers is that there is an awful lot of consumer surplus out there (the difference between the price you’d pay and the actual price), which means prices do not accurately reflect individual demand curves. This may possibly change in the age of the Internet and its concomitant ‘big data’ programs, algorithmically designed to track our every move, purchase, taste and interest. An algorithm that can have a much better idea about our demand curves can tailor bespoke prices for individuals. This may mean that a Star Wars retailer would offer their merchandise to sci-fi geek Andy for a higher price than it would Harry the Star Wars-hating snooker fan. In fact, this is happening already is some areas of retail. There are data mining devices that can evaluate your desire for a holiday (if you’ve visited the page multiple times in a day for example) and adjust its prices accordingly.

While this will probably never be an exact science, as individual utility gathering will be difficult to determine with precision, I can well imagine a time in the future when the majority of prices are much more closely aligned to what people are willing to pay. And while this will benefit suppliers, it will no doubt eat into our consumer surpluses, and therefore reduce the amount of value created in society - that is, unless a very adaptive human psychology can keep us one step ahead of the game.

The 'Evil' Priming Of Greta Thunberg

 

In a rare moment of emotional masochism, I just watched the documentary I Am Greta. A popular view about Greta Thunberg - perhaps the most popular view of all - is that she's a young hero, bravely speaking up against climate injustices in the world, and that she's about to go on to be one of the most significant voices of her generation. It's a view that I think is both dangerous and reprehensible.

Don't get me wrong. Under different conditions, the story could be quite a powerful one. Schoolgirl galvanises millions of people to form an allegiance in fighting one of the world's biggest problems, and even the politicians stand up and laud her. If it was for a cause worth fighting for, with an agenda based on reason and good arguments, we could all stand up and applaud, possibly even gush with admiration at such a seminal moment for a teenage champion and underdog.

But we can't, and we shouldn't, because what is happening with the cult of Greta is bad and perverse (for further reading on this, see here and here). In fact, watching what's happening to her, and observing how a mass delusion is leading her so far off course, engenders such a level of disgust and revulsion in me, that I actually suspect the Greta phenomenon might be tapping into something quite evil.

If that sounds too extreme, here's what I mean. There are two kinds of evil that plague societies, which for simplicity I’ll call the manifestly evil and the subtly evil. Everyone knows the manifestly evil – it’s the evil that upon reflection nobody has any trouble identifying as evil. Examples of which would be political agendas behind Nazi Germany, the Khmer Rouge and modern day North Korea. But there is another kind of evil that goes unnoticed and unchallenged by most of the masses - the subtle evil of bad things purported to be good things. I believe that the radical left’s extreme economic policies, and the climate change alarmism of Greta Thunberg and Extinction Rebellion fall under this category - they are abjectly dehumanising entities.  

Now there’s no question that in terms of intentions and moral response, the manifestly evil acts are a lot worse than the subtly evil ones. It doesn’t take a genius to work out that Hitler is an all round more repugnant human being than John McDonnell, Paul Mason, Elizabeth Warren, George Monbiot and Naomi Klein (although two caveats: 1: the ideologies they espouse can very quickly turn into manifestly evil regimes - it's only a matter of scale; and 2: under the wrong conditions most people are capable of far more evil than they would wish to acknowledge).

Regarding the profiling of Greta Thunberg - I want to be clear here: it’s not manifestly evil that a group of unbalanced extremists are politically grooming a scared, paranoid, obsessive-compulsive young girl with Asperger’s to be the poster-girl for their cult of delusion. But it may be subtly evil to exploit a vulnerable teenager in this way. It may not contain murder or torture or overt cruelty, but it contains many of the defects associated with moral wrongness, like manipulation, grooming, falsehood, delusion, scaremongering, civil disobedience, narrow tribal agendas and the hugely damaging ‘unseen’ effects of only looking at costs (and ignoring benefits) and trying to demand over-simplistic solutions to extremely complex problems. If not manifestly evil, the cult of Greta is plagued with manipulations, falsehoods and delusions that clear the ground for greater evil to manifest itself, while at the same time damaging a vulnerable child with paranoia and brainwashing.

Something that really strikes home about the past couple of generations is how they unashamedly lack gratitude for the monumental human achievements of which they are beneficiaries, and how so immeasurably better off we are compared with our ancestors. People in the Western world live in the most privileged time of any humans who have ever lived, yet they go around bemoaning the fact that their world is so utterly terrible. Anyone who goes about their business with almost existential ingratitude is barely awake, in my view, and is quite unbalanced and deluded. 

There is, to my mind, a subtle evil about that kind of mentality when it is used to scare the youth of today into an intense lack of gratitude, an entitled arrogance, and an abject failure to apply a proper balanced perspective to the world. Given the harm that such brainwashing has done to the world’s poorest and most vulnerable people over the last 150 years, don’t be too quick to dismiss the idea that there might be something a little evil about the conditions that created the cult of Greta!