Cass Sunstein: for the Homer Simpson in all of us

Click to listen to Chris’s conversation with Cass Sunstein (30 minutes, 14 mb mp3)

Cass Sunstein of the gentle Nudge

Cass Sunstein gives us the half-hour short course here on “the most exciting intellectual movement of the last thirty years” — behavioral economics, that is, of which we had a taste recently with George Lakoff and Dan Ariely.

Behavioral economics is the demonstration (by clinical psychology, affirmed by neuroscience) that the “rational man” of neo-classical economics is in fact, in Dan Ariely’s book title, Predictably Irrational — that we are eternally kidding ourselves in our choice of credit cards, or of diets and desserts; that we tend to lurch without much reflection from over-optimism to over-anxiety about terrorist threats, war risks, and environmental melt-downs. Cass Sunstein is himself a demonstration of the spread of the new thinking from psychology and economics to law and politics. From the University of Chicago Law School, where he taught alongside Barack Obama for a dozen years, he has just moved permanently to Harvard, where he and Obama seem still to be channeling each other. Sunstein’s new book Nudge, with the economist Richard Thaler, is an introduction to a variety of not-quite-coercive strategies for helping people get what they really want: 401k savings plans, for example, that would be automatic for all workers who didn’t choose to set some of their wages aside. The general trick, Sunstein says, is recognizing that there’s less Immanuel Kant, more Homer Simpson, in each and all us than we’ve been taught.

This started with psychology. Two Israelis Daniel Kahneman and Amos Tversky did a bunch of amazing experiments in the 1970’s where they said people use some mental shortcuts in trying to think about risk. If a recent event, for example, is in your head, say it involves a crime or a misfortune or something wonderful happening, then you will think it’s really probable that the crime or the misfortune or the wonderful thing will happen. This way of thinking migrated first into economics. There has really been a revolution in economic thinking because economists are trying to do their work with a realistic rather than artificial sense of what human beings are like. The idea is that we can do economics with Homer Simpson as our types rather than doing economics with computers as our types. People just aren’t computers. When Homer, in one episode, went to buy a gun, the gun owner told him that him that there is a three day waiting period. And Homer responded: “What? Three Days? I’m angry now!” So that captures people’s passion and focus on the short term, and it also captures how law and policy can help a lot.

Harvard Law Professor Cass Sunstein in conversation with Chris Lydon, August 21, 2008.

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  • piminnowcheez

    Professor Sunstein expresses a misunderstanding about what cognitive science is. Cognitive SCIENCE has been around much longer than cognitive NEUROscience, which does depend on technologies for imaging brain activity, like fMRI or ERP. Professors Kahneman and Tversky were practitioners of cognitive psychology, which, along with artificial intelligence, was one of the early disciplines to be described collectively as “cognitive science.” So behavioral economics, to the extent that it traces its roots to Kahneman & Tversky’s groundbreaking descriptions of actual, rather than idealized, human decision-making behavior, certainly qualify as cognitive science.

    Cognitive neuroscience, fwiw, was originally conceived of less as a way not of understanding how the brain works, than of using knowledge about brain activity to understand how cognition works. For example, if you know the amygdala is activated during a particular cognitive process, does its association with fear or stimulus salience tell you anything about the cognitive process in question?

  • hurley

    I agree with pimm…insofar as I understand what I see as the confusions within the conversation. Chris correct to explore this pop wisdom, the better to debunk it. I find it– behavioral economics — a weird fusion of tedium and beige, a boring, even dangerous idea clothed as science, neuroscience, no less, that Barbie of currently received opinion…The notion of someone X-raying my brain — yours, too — for any but homely diagnostic purposes..Need I finish the sentence?.I hope not. There are novels and poems and plays that might tell you what you already know, or what you might want to know. etc..

  • veritasrox

    Behavioral economics is a fascinating field of study, with an ever-growing list of “Heydidjaknowthat!?” – style findings. I must admit that I am still waiting for a better synthesis of experimental observations with neoclassical economics’ “enlightenment promises,” particularly when it comes to theorizing about human agency. Sometimes the mountain of tidbits about our irrationality starts to overshadow our free will, especially in the political sphere. For example, during primary season I encountered many undecided voters who felt trapped by a strange game matrix: they hypothesized that the rest of the electorate would vote “irrationally” based on their primitive instincts or prejudices and therefore felt compelled to select strategically a candidate who could counter this irrationality RATHER than the candidate they themselves favored most. This situation may speak to our need to structurally reform our electoral system to better express authentic voter preferences, but it certainly also shows how we can become a little bit lost when we lack a way to factor our own agency into our provisional models of human behavior.

    As Chris indicated, the Obama campaign provides a lens for examining the various possible societal responses to the newsflash that we are not simply God’s-image robot-rational beings. On the one hand, we can strive to implement benevolent policy that makes government work for us in a user-friendly way (what Cass called “iPod Governement”). While there may be some citizens who want the freedom to calculate their every risk and optimize every expenditure, for most of us this sort of self-interest management is an administrative burden. We would rather buy into a system that reflects our values (like universal health care), and then leave it to well-paid wonks to figure out the details. On the other hand, Obama has tried to inspire his supporters, Kennedy-style, to DO things for the country – to perceive ourselves as, and in doing so BECOME, a different kind of political actor than we have been for the past 8 years. This requires a belief in our own powers to make a difference, a commitment to create and collaborate with our fellow citizens, and trust in each other that we can work together to build a better society. As I see it, behavioral economics still takes a rather skeptical view on this sort of optimism, and I would like to see the irrational-actor models evolve to the point where they can better explain and interpret this sort of inspirational-agency phenomenon.

    A final note on the legal system: <Mahzarin Banaji has done fascinating work on our implicitly-held biases against certain identity categories. Among other things, her research leads us to question our reverence of certain socio-legal practices, such as reliance on eye-witness testimony during criminal trials, that tend to exhibit more irrational cognition than is morally or ethically justifiable.