Tuesday, March 21, 2017

Reflections: Nudge

Nudge by R. H. Thaler & C. R. Sunstein
Nudge has been on my list to read for literally years. In fact, I think I added it to my list shortly after it was published. I have finally gotten around to reading it, and I'm glad I can be a part of a very important conversation.

To begin with, the main thrust of the book requires the reader to accept certain assumptions about human thinking and nature. The authors insist we are not, regardless of how many Economists say otherwise, purely economic creatures which make decisions within a nicely defined and enlightened definition of self-interest but are instead vexed with all sorts of irrationality and injudicious decision-making. Due to this, humans (vs. econs) would benefit from "nudges" from third-partiespublic or privatein a variety of arenas, such as savings, investments, health, etc. I was already familiar with much of the psychology and behavioral economics which support the authors' conclusions and recommendations (Thinking, Fast and Slow delineates quite a bit of it in much more detail), and there is, no doubt, plenty to debate in the science that constitutes the foundation of Nudge.

Nudge presents "libertarian paternalism," which at first glance seems to be a concept that is an oxymoron. Linked with this concept are some additional conundrums, such as someone having the role of a "choice architect." To be honest, much of it makes me feel uncomfortable, albeit I am not repulsed by it. The authors' arguments are at times persuasive, especially when dealing with default choices. A choice has to be made; individuals are already being influenced (realized or not) in one or way or another, why not attempt to nudge them toward the most beneficial choices? This sounds completely reasonable, of course, when dealing with what seem like obvious choices, such as smoking or saving more for retirement. However, the nudge concept quickly becomes more paternalistic and less libertarian the more it's applied and the broader its reach. (The authors deal briefly with objections at the end of the book and the "slippery slope" argument is addressed; yet, it is, as is often the case, underestimated by the authors. The slippery slope argument often sticks because it is often true!) Especially when starting with the premise that human beings are in many ways bad decision makers and need help from more enlightened intellectuals, the technique of nudging can so very, very quickly turn into pulls, pushes, and shoves.

Furthermore, I feel the authors understate the difference between a public and a private institution. Although corporations can be powerful, they can never be as powerful as a government entity, which holds the monopoly over the use of force. This isn't to say that government can't do some good and can even improve the way it presents choices to its citizens, it is a mistake, in my opinion, to equate a corporate board with a congressional chamber. One can use the force of law and another cannot. Harm can be done by both, yes, but the power of one can always dominate the influence of the other. The most useful and safest kind of nudges are those implemented and perpetuated by private institutions and citizens that attempt to nudge others in a social way.

Nudges are everywhere, and this I think is one of the most important lessons I learned from the book. As human beings, we can be overwhelmed by inertia or by loss aversion or by a multitude of other factors when making decisions. Knowing this will hopefully make us better decision makers, regardless of the nudges we're receiving. As this cannot be expected to happen for many, I can be persuaded to incorporate nudges in a variety of areas, but my libertarian guard will always be up against any paternalistic plotting.

Nudge does present some valuable ideas. Yet, I wonder how far "libertarian paternalism" can extend and into what areas without the paternalistic side of the equation tipping the scales in its favor. Having said that, there are some very simple applications of the nudge concept, such as making certain decisions easier to make and breaking down barriers, which could easily be implemented without any significant moral, ethical, and ideological concerns being raised. Those "choice architects" (shiver) just have to get it right, and maybe that's where I lose most of my faith.

Other Topics of Interest:
Reflections: Thinking, Fast and Slow
Reflections: Life at the Bottom
Reflections: Utilitarianism

Tuesday, March 14, 2017

Reflections: Good to Great

Good to Great by Jim Collins
I can imagine that writing a book like Good to Great is an open invitation to cynics and critics to prove how the author got it all wrong. Being published in 2001, the book represents a snapshot in time, which becomes obsolete, similar to the latest technological product, almost as soon as it hits the public's hands. Jim Collins and his team identified eleven companies which met their criteria, which they wisely detail after the close of the book, that made the leap from a "good" company to a "great" company. What are the primary ingredients? And can it be duplicated?

As would be expected, the book lists (business books love lists) several key components for making the leap from good to great. Although not revolutionary (like most business books), the concepts are thought-provoking and no doubt valuable. Considering the book is about companies rather than individuals becoming great, the concepts are related to organizational effectiveness and transformation. However, as with most concepts, what could be applied at a macro level can probably find some kind of application at a micro level.  Some of those concepts are intuitive, such as having a culture of disciple, but others are less so, such as the "First Who, then What" principle.  However, after some pondering the principle becomes more sensible and less radical.  But is it a true principle? 

Reading the book in 2017 necessarily colors the content of the book in a way which couldn't be considered in 2001. For example, Circuit City is listed as one of those companies which made the leap from good to great. Circuit City doesn't exist anymore. Rather than disproving any of the findings of the book, however, I am intrigued by the idea of constant change and adaptation in the marketplace. Although a company can thrive or even be the best, that does not guarantee its long-term success or even survival. Competition, as well as the natural (and unnatural) forces at work in a marketplace, can make today's titan tomorrow's pygmy.

Good to Great is a fine bookwell written with valuable insight and worthwhile anecdotes and conclusions. It can also, more than likely, all be proven wrong or at the very least severely challenged, as I'm sure many academics and other interested parties have done. Regardless, I enjoyed the book and was able to cull from it applicable and relevant leadership and professional tactics.

Other Topics of Interest:
Reflections: Outliers
Reflections: The 7 Habits of Highly Effective People
Reflections: The Marshmallow Test

Monday, March 6, 2017

Reflections: The Scarlet Letter

The Scarlet Letter is a difficult book to love. Melancholy drips from every page.  From its sober beginning to its funereal ending, The Scarlet Letter is a bit of a slogalbeit a well-written one.

As was expected, the book is a harsh indictment of Puritan social structures and culture.  Themes of hypocrisy and judgment are pervasive, but I was far more interested in the exploration of confession.  Hester Prynne, by virtue of her wearing the scarlet letter, is a walking confessiona socially (and personally) imposed punishment.  Yet, her accomplice in the sin (who I won't reveal here) avoids confession and lives as a hypocrite, which, it can be argued, is the much more egregious sin. The book bears clear witness to the danger and agony of living such a life.  There is plenty of fault and guilt to go around in the book, including and perhaps especially that guilt and shame which its Puritan society should feel.

To provide my own commentary, I would hesitate to embrace the lesson of unrestrained tolerance as the moral imperative to be learned from Hawthorn's tale.  Adultery is an evil, regardless of society's unbalanced condemnation of it.  In our society of acceptance, it is easy to condemn (as they would us) the Puritan moral and ethical protocols.  However, it doesn't follow that everything they would condemn should become behaviors we should embrace.  Rather, I think the question becomes what the "scarlet letter" should be; in other words, societiesorganically or notcreate scarlet letters for all sorts of behaviors.  Furthermore, societies within a larger society, such as a religious community, create and perpetuate their own scarlet letters.  A scarlet letterwhatever form that takesas a means to correct or guide behavior is not an inherently bad thing.  The discussion should revolve around how it should be used and for what behaviors, not whether or not it should be abolished entirely.  That simply won't happen.

The ending line, which almost requires additional research to understand and appreciate, highlights perhaps the main theme of the book, which is the great Christian obligation to "[j]udge not, that ye be not judged" (Matthew 7:1).  More often than not, our ability to judge and discern correctly is severely limited, and we know very little of others' personal torments and motives. The scarlet letter becomes the behavior or choice which is the most conspicuous, but the background and context against which it is set and contrasted against is far less understandable. In our lacking understanding, we often judge incorrectly and often far too harshly. Perhaps that is the most important personal lesson I learned from Hester Prynne.

As you can see, The Scarlet Letter is not terribly enjoyable to read, but it does offer plenty to talk about. I fear, and perhaps this is an unjustified judgment, that the discussions surrounding this book focus far more on toleration rather than on moderation. I am more interested in the latter than I am the former, but I would gladly participate in the discussion.

Other Topics of Interest:
Reflections: Heart of Darkness
Memorable Moments: A Tale of Two Cities - 'Tis a far, far better thing'
Pointless Stories and the Morality of Fiction