- “Human action is necessarily always rational” is a quote from Mises that expresses the same. Later he writes “The ultimate end of action is always the satisfaction of some desire of the acting man. Since nobody is in a position to substitute his own value judgements for those of the acting individual, it is vain to pass judgement on other people’s aim and volition.” (Human Action, Chapter I. Acting Man)
- Rational doesn’t imply effective. You might act in a way that brings you further aways from what you aimed for, but the action itself was still rational. (Like a doctor 100 years ago who used cures that are deemed ineffective by todays doctors.)
- Again from Mises: “The opposite of action is reactive response to stimuli.”
- Whatever you’re doing right now is the best use of your time, according to you.
- I don’t know much about IIT, basically only watched https://www.youtube.com/watch?v=0hex5katLGk, but have a feeling that there is a deep connection here. I find it interesting that Mises and Tononi stress the importance of consciousness for action.
- Alternative title: Everyone already follows their incentives optimally. Every System follows it’s own logic. What in the in-animate or animal world are natural laws and instincts, like gravity, or hunger, in political and societal and organisational systems are incentives. To really understand a system, start with the premise that what you see is perfection according to the laws that the individual parts of the system follow.
- I think I should talk about motivation here, because that’s what I’m pointing to: People are motivated by something and act accordingly. Incentives are one input in the calculation of what they do next
- Starting with this, many things that seem irrational to us, only show us gaps in our model of others and the world. There are no contradictions. Check your premises
Example from a piece about the exploding popularity of various forms of casinos among young peopl:
For a generation that sees no realistic path to these things through conventional means, the expected value of a moonshot starts looking better than the expected value of grinding. If your baseline is “treading water forever,” then a PERCEIVED 5% chance of escaping is mathematically attractive against a 100% chance of staying stuck.
This isn’t financial illiteracy. It is revealed preference under constraint.