Afterword
My background was originally in cognitive neuroscience. It started from looking at optical illusions. Weird patterns shown to our eyes, our brain playing tricks on us. As the theory goes, optical illusions serve a purpose. Our brain is not powerful enough to process the world in its entirety, and so resorts to certain practicalities. It decides to tell us just enough to act on, guided and stabilized by billions of years of natural selection towards choosing the proper realities.
Natural selection is a statistical tool present wherever there is continuous heredity. Our laws [54], economies [107], languages [32], traditions [85], and even our sense of fairness [17] are guided and stabilized by the principle of natural selection. After many years of guidance, these aspects of our world have stabilized enough to be predictable through the lens of optimality. But our world is far from stationary. Whether we look backwards ten, a hundred, or a thousand years, much of our past looks foreign. We still have not reached the end, if there will ever be one. To what extent are our optical illusions optimal responses, and to what extent are they relics of a less than optimal past? And how much of our sense of fairness?
To understand our irrationality, we must first understand optimality. Ariely2, Loewenstein, and Prelec [9], following Kahneman and Tversky [110], ran an experiment that stuck with me. Test subjects bid on an object after seeing the last two digits of their social security number. Those with a higher number bid higher. In a world where our mind must process many things at once, it cannot afford the luxury of properly classifying every source of information. In a decentralized world where our sense of value is not fully grounded, we look to what others do for guidance. What is optimal? What is a relic?
In my teens, I was enraptured by Leonard Read’s “I, Pencil” and Hayek’s “The Use of Knowledge in Society”. Could economics, a field that studies optimality in decentralized societies, arm me with the frame to answer my two simple questions? After reading further, I kept finding papers that came close in description, but kept falling short of what I wanted. Each introduction would have beautiful prose stating, clearly, that the author shares much of the motivation that I do. And yet whenever I looked deeper, I kept encountering a barrier that stopped the rest of the text from matching the introductions’ promises. Economists, to me, did not have what they needed to properly write down optimality.
Mathematics, the tool that let Isaac Newton write down the motion of celestial bodies, my joy I had not yet found a use for, became my answer.
The unknown beyond what we can see. If we do not know it, or simply cannot understand it, can we tell it apart from randomness? The proper mathematics describes optimality in a random world, a society more complex than we can understand.
More than a decade later, this dissertation’s only goal is to arm those who care with better tools to understand this world, and help me start again where I left off and answer my two simple questions.