A slow post...  

Somehow, around two weeks ago, I strained? pulled? twisted? some thew or something in my left shoulder. Driving a tractor with all the controls on the right became a real hassle, and putting on my pants a challenge. Needless to say, posting one-handed wasn't fun either.

So I didn't.

But it's getting better in that casually glacial pace I now realize is how geezers heal.

So let's talk irrationality. It seems fitting just now when a new farm program is taking shape.

As many of you know I have been fascinated with efforts by cognitive psychologists to understand why we make irrational choices, indeed how we choose in the first place. A considerable body of research has piled up on the odd ways our mind works.

All of it is pretty damning when it comes to imagining our species as having anything at all in common with say, Vulcans. We are persuaded by the trivial, attention-grabbing, or emotional in the face of hard facts to the contrary.

In fact, it all seems pretty futile.

The last several years have seen many popular psychology books that touch on this line of research. There’s Ori and Rom Brafman’s Sway, Dan Ariely’s Predictably Irrational and, naturally, Daniel Kahneman’s Thinking, Fast and Slow. If you could sum up the popular literature on cognitive biases and our so-called irrationalities it would go something like this: we only require a small amount of information, often times a single factoid, to confidently form conclusions and generate new narratives to take on new, seemingly objective, but almost entirely subjective and inaccurate, worldviews.
The shortcomings of our rationality have been thoroughly exposed to the lay audience. But there’s a peculiar inconsistency about this trend. People seem to absorb these books uncritically, ironically falling prey to some of the very biases they should be on the lookout for: incomplete information and seductive stories. That is, when people learn about how we irrationally jump to conclusions they form new opinions about how the brain works from the little information they recently acquired. They jump to conclusions about how the brain jumps to conclusions and fit their newfound knowledge into a larger story that romantically and naively describes personal enlightenment.
Tyler Cowen made a similar point in a TED lecture a few months ago. He explained it this way:

There’s the Nudge book, the Sway book, the Blink book… [they are] all about the ways in which we screw up. And there are so many ways, but what I find interesting is that none of these books identify what, to me, is the single, central, most important way we screw up, and that is, we tell ourselves too many stories, or we are too easily seduced by stories. And why don’t these books tell us that? It’s because the books themselves are all about stories. The more of these books you read, you’re learning about some of your biases, but you’re making some of your other biases essentially worse. So the books themselves are part of your cognitive bias.

The crux of the problem, as Cowen points out, is that it’s nearly impossible to understand irrationalities without taking advantage of them. And, paradoxically, we rely on stories to understand why they can be harmful. [More]

Currently, I'm reading Jonathon Haidt's The Righteous Mind, which could be the best of the bunch. And despite the warnings voiced above, I think it has been remarkably helpful, especially in this election season.

But I agree about the "narrative bias". The reason farmers watch USFR is hear a story about the commodity markets that has all the elements of any good yarn. Good guys and bad guys, a range of motives, and nearly miraculous abilities to shape events.

Most of all it transforms a raft of transaction details (sales) into an living entity - The Market. This entity goes shopping for acres, gets confused, and tries to persuade farmers to do various things like hold crops or shift acres. It is this enduring fairy tale that takes a mess of dry data and turns it into something we think we understand. In reality it is little different from seeing a pony in the sky when looking at water vapor accumulations.

The bigger question is if we can or even should override this predilection to choose a narrative over say, a statistical summary. Currently, I still hold out hope we can, but it's so much hard work with often little reward, we don't.

Regardless, just knowing our thoughts are riddled with inconsistencies should enable us to proceed with more caution, especially when demanding we know The Truth.

I notice they didn't test calls to Dad...  
  
Calling to talk to Mom is good for you.

Wired flags a new study that proves many mothers across the country right: For your own sake, you should call home more often. The research comes from Evolution and Human Behavior. It finds that a phone call to mom provides significant stress relief while instant message conversations won’t quell the nerves.
The conversations happened after research subjects took a stressful test. As subjects spoke (or typed) with their mothers, the researchers measured changes in levels of cortisol (generally linked to stress) and oxytocin (a hormone linked to pleasure). When subjects talked on the phone, cortisol levels dropped and oxytocin went up. But IMing with Mom looked the same as having no contact at all. [More]

I also note the test was for girls calling home.

Fictive learning strikes again...  

Upset because you didn't sell the rest of your corn three weeks ago? This is your brain on volatile markets:

Montague, et. al. immediately discovered a strong neural signal that drove many of the investment decisions. The signal was fictive learning. Take, for example, this situation. A player has decided to wager 10 percent of her total portfolio in the market, which is a rather small bet. Then, she watches as the market rises dramatically in value. At this point, the investor experiences a surge of regret, which is a side-effect of fictive learning. (We are thinking about how much richer we would be if only we’d invested more in the market.) This negative feeling is preceded by a swell of activity in the ventral caudate, a small area in the center of the cortex. Instead of enjoying our earnings, we are fixated on the profits we missed, which leads us to do something different the next time around. As a result investors in the experiment naturally adapted their investments to the ebb and flow of the market. When markets were booming, as in the Nasdaq bubble of the late 1990s, people perpetually increased their investments. In fact, many of Montague’s subjects eventually put all of their money into the rising market. They had become convinced that the bubble wasn’t a bubble. This boom would be different.
And then, just like that, the bubble burst. The Dow sinks, the Nasdaq collapses, the Nikkei implodes. At this point investors race to dump any assets that are declining in value, as their brain realizes that it made some very expensive mistakes. Our investing decisions are still being driven by regret, but now that feeling is telling us to sell. That’s when we get a financial panic.
In the last year, Montague has expanded on these provocative results. He’s shown, for instance, that heavy smokers are less vulnerable to fictive learning. This is probably because they’ve learned, over time, to ignore those regretful thoughts telling them to quit smoking. (Although they lament their nicotine addiction — they know it’s killing them — they keep on lighting up.) The upshot is that their ability to not learn from fictional scenarios might also make them more resistant to the allure of bubbles. The lesson, I guess, is that it might be good to have a stock broker with a debilitating addiction.
Montague has also begun exploring the power of social comparison, or what he calls the “country club effect,” on the formation of financial bubbles. “This is what happens when you’re sitting around with your friends at the country club, and they’re all talking about how much money they’re making in the market,” Montague told me. “That casual conversation is going to change the way you think about investing.” In a series of ongoing experiments, Montague has studied what happens when people compete against each other in an investment game. While the subjects are making decisions about the stock market, Montague monitors their brain activity in two different fMRI machines. The first thing Montague discovered is that making more money than someone else is extremely pleasurable. When subjects “win” the investment game, Montague observes a large increase in activity in the striatum, a brain area typically associated with the processing of pleasurable rewards. (Montague refers to this as “cocaine brain,” as the striatum is also associated with the euphoric high of illicit drugs.) Unfortunately, this same urge to outperform others can also lead people to take reckless risks.
More recently, a team of Italian neuroscientists led by Nicola Canessa and Matteo Motterlini have shown that regret is also contagious, so that “observing the regretful outcomes of another’s choices reactivates the regret network.” (In other words, we internalize the errors of others. Or, as Motterlini wrote in an e-mail, “We simply live their emotions like these were our own.”) Furthermore, this empathy impacts our own decisions: The “risk-aptitude” of investors is significantly shaped by how well the risky decisions of a stranger turned out. If you bet the farm on some tech IPO and did well, then I might, too.
There are two important takeaways to this research. The first is that neuroscience might soon be able to help make macroeconomic diagnoses, allowing us to better distinguish between booms and bubbles. For instance, one could have subjects “play” the current gold market in a scanner, if only to see how their brain activity compares to that of people playing previous market bubbles.
The second is that speculative bubbles are rooted in a very adaptive learning mechanism, which is probably why they’re so hard to prevent. The only way to keep us from bidding up LinkedIn stock and tulips is to keep us from learning through counterfactuals. Of course, that means we’d be cut off from a crucial means of self-improvement, a way of benefiting from mistakes we didn’t actually make. In other words, the reason we sometimes make such stupid investment decisions is because we’re so damn smart. [More worth reading]

I still don't think our markets are "bubbling", but the more I read about my lyin' brain, the less sure I am about my reasons.

I think the availability bias is also making me think this will be another relatively poor crop, for us and the US, simply because our recent trend is downward as too much water has plagued us consistently since 2007. None of these are sound reasons or bases for prediction.

Speaking of which, I just finished a thoroughly enjoyable, albeit discouraging book:

[More]

Like Philip Tetlock's monumental work the evidence and logic is very persuasive, but Gardener sheds more light on why and how our brains deal with uncertainty (badly) and how we massage our own thinking to relieve the stress uncertainty brings us.

Passive marketing is looking better and better all the time.

More lead...

When I posted about the EPA and lead, some questioned the math/science of the correlation.  This excellent post by my favorite neuroscience blogger may help supply some reasons behind my opinion.

Are liberals just conservatives...

Who have made some money? Will Wilkinson, who normally thinks about three levels above me does a wonderful job of drawing together some current research on our "default" values and how they change. Please read the whole post, but here is the set-up:

University of Virginia professor of psychology Jonathan Haidt is a pioneer in the scientific study of moral emotion and cognition. Haidt’s principal claim to fame is his “five foundations” theory of human morality. Imagine a graphic equalizer on a stereo with five separate settings that slide up and down. One setting determines our sensitivity to suffering and harm. One calibrates our sense of reciprocity and fairness. Another fixes our degree of in-group loyalty, and establishes how inclusively we draw the circle around those we consider one of “us”. Still another concerns our attitudes toward authority and the duties of our station. And then there is our “spiritual” sense of the sacred and the profane. Recently, Haidt has entertained the possibility of a sixth slide on the moral equalizer determining our attunement to matters of individual autonomy and freedom, but we’ll stick with just the five for now.The elegant basic idea is that variation along a small number of universal dimensions of emotion and cognition can account for the entire stunning range of human morality. Afghani herdsmen and American animal rights activists surely disagree about a lot, morally speaking. But their respective cultures draw from the same fund of psychological resources to construct each of their deeply-felt, guiding moralities. We all have the same basic moral equalizer. We just differ in our settings.Among Haidt’s most provocative findings is that American liberals and conservative differ systematically in the calibration of their moral equalizers. Liberals have harm and fairness (Haidt calls these the “individualizing foundations”) pushed way up and in-group, authority,and purity (the “binding foundations”) pushed way down. In contrast, conservatives have all the slides pushed up, though their individualizing settings are not set as high as are liberals’.Haidt has tended to characterize conservative morality, resting on as it does on all five moral foundations, as more complex or in some sense full-bodied than liberal morality, which rests almost entirely on just the two individualizing foundations. Haidt argues that traditional moralities, like contemporary conservative morality, tended to have all the settings on the moral equalizer turned up relatively high, and he describes the process by which we have arrived at liberal morality, with everything butfairness and harm turned down, as “the great narrowing.”

But he goes on to touch on the puzzle of my own value evolution and shed great light on why we are not guided by the same morality over our whole lives. It may be that prosperity, or at least less stress over wealth and material well-being frees us up to tweak our values.

In other words, as the threat of economic insecurity and its concomitant zero-sum conflict over resources recedes with the rise of material prosperity, the defensive binding foundations also recede, leaving the rising generation with a moral equalizer on which in-group, authority, and purity have never been turned up, making fairness and harmrelatively more salient. Now, toss in Inglehart’s Maslovianism. As our material needs are met, higher-order needs of consciousness become more pressing. So, at the point in development in which a generation is struck by the “postmaterialist” impulse to seek meaning through moral activity, it finds itself with a historically relatively liberal morality preoccupied with distributive fairness, the reduction of suffering (and, I think, autonomy). In the quest for meaning-making, postmaterialist generations latch onto and refine these moral sensibilities, further raising their salience relative to the binding foundations. Haidt’s “great narrowing” follows from the “great cushioning” of rising prosperity. Of course, as soon as, say, a recession hits, the defensive binding foundations kick in a bit, and a bunch of us buy bald-eagle t-shirts and get mad at about immigrants stealing our jobs.

But here's the catch for grain farmers: we cannot escape the zero-sum aspect of our work. There are only so many acres, and if I farm them, you don't. Now add in the added insecurity over tenure (land rental) we have developed though increasing transparent cash rental markets, and it is small wonder farmers poll as very conservative. We do not operate in a world where we can ever back off our conservative settings, or at least until we own enough land to make us effectively invulnerable to rent predators. [I define that as able to survive comfortably on just what we own]

This would help to explain why grain farmers, in the midst of the biggest boom in US history for their sector of ag, have high disapproval ratings for Pres. Obama. This has mystified me, since in addition to making oodles of money (as compared to say, Reagan) Obama has defended ethanol, GMOs, and generally been less eager to slash the ag budget. I think there is a considerable racial element as well (judging by the jokes I hear), but clearly we are not voting our wallets. We are voting our perceived insecurity.

This really strikes home with me. It seems logical that my changing views about inequality and social well-being are luxuries I could only afford very recently. In addition, the zero-sum aspect of our work is a bigger clamp on our moral outlook than I ever imagined.

At any rate, Will's writing is first-rate, and his logic is impeccable. Highly recommended.

[You may need to read some of it 2-3 times. DAMHIKT.]

Stories change our world...

After a wonderful meal with old friends last night, I awoke to read this:

You see what happened there? Even though their assumption about wine was false – the more expensive Cabernet didn’t taste better – that assumption still led to increased pleasure, both as measured in terms of self-reported preference and as a function of brain activity. Sure, that pleasure is a figment of our blinkered imagination, but what part of pleasure isn’t an imaginary figment? Instead of bemoaning this subjectivity, we should embrace it. We should realize that we can make our wines much more delicious, if only we take the time to learn about them. Because we don’t need to spend a fortune on old fruit juice – price is not the only way to raise expectations. (It’s also, you know, an expensive way to raise expectations.) If my tippling experience has taught me anything, it’s that we can also make our wines taste better by delving into the history of the varietal or the region or the pretty picture on the label. And that’s why I will always be one of those annoying people who insists on muttering about malolactic fermentation while pouring Chardonnay, or on explaining the genetic kinship between Primitivo and Zinfandel when all you want is a damn glass to go with your red-sauce pasta.The reason I harass my dinner guests is that our stories have consequences, that our beliefs often matter more than the grapes. The question is what those stories are. If the only story we can tell about wine is its price, then our pleasure will always linked to cost, even though this link doesn’t exist in most taste tests. A much better (and more cost-effective) idea is to find some other narrative, to focus on aspects of wine that don’t require a big expense account. Knowledge is free. [More]

I had read several times about similar studies and those results always made me wonder how I could forget the price of the bottle I just bought. But this may be a case of not being able to fool yourself, but you can add to the pleasure of others. First, of all don't natter on about the price unless it was a notch higher than they have come to expect in your home. I even wonder about the ethics of inflating the price so folks enjoy it more.

I am sure there are other social transactions where this phenomenon applies. So being a habitual storyteller may make your company a welcome part of a gathering. It would also seem to help if you are more optimistic - filling in details about the shared experience in progress that add positively to enjoyment. 

Funny old brains.

Encouraging flip-flopping...

While equated with political suicide, the idea of seeing the other point of view is not without merit.



[via mr]

Not only diseases...

While we are all keeping an eye on the H1N1 virus, scientists are looking at how other things can be spread among a population.  Even behaviors.

Sociologists began hunting for ongoing, real-life situations in which better data could be found. A 2000 study of dorm mates at Dartmouth College by the economist Bruce Sacerdote found that they appeared to infect each other with good and bad study habits — such that a roommate with a high grade-point average would drag upward the G.P.A. of his lower-scoring roommate, and vice versa. A 2006 Princeton study found that having babies appeared to be contagious: if your sibling has a child, you’re 15 percent more likely to have one yourself in the next two years. These were tantalizing findings, but again, each was too narrow to really indicate whether and how the effect worked in the mass public. What was needed was something more ambitious, some way of mapping out the links between thousands of real-life people for years — decades, even — to see whether, and how, behaviors spread. [More]

We have seen more evidence of this type of contagious social behaviors (overeating, for one).  While it certainly points out how much impact our friends have on us, it also works the other way around. 

It is not a comfortable thought at times.

The bigger question for me is if the nature of the farming community is still collective enough to promote such effects. Most of my friends are non-farmers, and I would hazard that is more the norm than highly occupation-centered social circles for farmers.  Our influence would likely be more noticeable in friendship links rather than professional connections.

It could be there is less internal contagion for farmers - where we all tend to think the same way on common issues - that we imagine.  This may contribute to our continuing dissatisfaction with how farmers are portayed in media.  We all have differing ideas of that that image should be.

Maybe there is a critical mass necessary for a coherent subculture that we dropping below.

Why we don't save more...

Kids and delayed gratification.



[via rgs]

Yeah, but think of all the surprises...

More than you can imagine, we are blind to changes around us.



I think this  is one reason why we wonder "why didn't we see X coming".  Answer: we don't notice much.  In a world of massive change and information about it flowing to us (or inundating us), it may be we need tools like Google to overcome this particular inattention.  We only have so much awareness, and it seems modern lifestyles don't enhance that meager talent either.  Outsourcing our change-awareness to computers looks like an idea worth investigating, anyway.

On the plus side, I suspect people who can find such ways to counteract their change blindness will reap significant benefits that will seem like luck to those beside them.

PS.  We also experience change deafness.

PPS.  This also why eyewitnesses are the worst kind of evidence.