Thursday, November 19, 2015

Fuzzy independence and wishful thinking

An interesting phenomenon of intellectual and political debates is how high calibre scholars are unable to apply the standards they use in their academic job when they participate in political debates. I knew of an example of this last week, after participating in Girona in an event about the future of fuzzy logic. I participated in this event as a result of a book chapter I wrote on "Fuzzy Logic and modern economics". I am basically an outsider to the field, but besides having an interest in the topic because my father is a great specialist in it, I have genuinely come to believe that there are some ideas there that can be useful for behavioural economics and related fields. At the end of the conference, I was told by one of the participants that two other scholars, also experts in the discipline, had been politely discussing with him about the desirability of the independence of Catalonia, and that the discussion had finished with a bet: if Catalonia is not independent after a reasonable period of time, the two pro-independence "fuzzy" scholars will invite the first one, who is not pro-independence, to have dinner. After thinking about it, I realized that this is probably in contradiction with fuzzy logic, to the extent that the category "independent countries" is a fuzzy set in XXI century Europe (that is, membership to the set is not a zero-one thing, but it is a matter of degree). If being independent means being an internationally recognized member state of the European Union, I would also bet that the two pro-secession scholars will lose their bet. But as things stand, EU member states these days are less and less independent, and less and less sovereign (ask the Greeks). Catalonia can be more independent, or less independent after the current drive. I think that today it is less independent than when the drive started three years ago. I honestly do not know if in two or three years it will be more or less independent. I wish that the degree of independence does not change substantially, but that the quality of its institutional relations with overall Spain and Europe improves. Of course, the scholars' bet had also a component of wishful thinking. Here's how to avoid it: talk to more people who disagree with you and open your mind. (By the way, I tried to do precisely this to predict the result of this Saturday's game between R. Madrid and FC Barcelona. In my economics and soccer class this week, I started by asking the students in my two classes to write down their estimated probability that RM would win. In one class, very few people wrote a figure above 50%, but in the second class they were more than half. I first wrote myself 40%, and after talking to them because they are more objective than myself, I updated my probability to 45%. Later, I checked information about the last 25 games in Madrid between the two teams, and it turns out that R. Madrid has won 44% of them. I also checked the betting markets, and these were assigning a probability of R. Madrid winning slightly below 50%. I wished it to be lower, but these are the facts after de-biasing myself. But at least the game is on Saturday and we will know: there will be clear feedback because soccer outcomes are less fuzzy than other categories. In comparison, the evolution of the institutional architecture of European nations and states will be a fuzzy never ending story in our post-Westphalian world).

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