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The Myth of Complete Knowledge

By Craig Wright | 17 Nov 2020 | Economics

The journal articles written by Jones (2003) and Cairney (2012) seem very different at face value, but we can see the same point of view in both. Jones analyses specific challenges to rationality that appeared in the 1950s, addressing the nature of homo economicus, and the bounds that exist on human action, using topics such as behavioral choice, cognitive psychology, and organizational theory. Cairney links the subject of complexity theory, a paradigm that has become common in scientific discourse on public policy, demonstrating the inappropriateness of many forms of top-down control. The link between their research is straightforward: if we cannot expect to act with complete rationality, then we cannot assume to be able to centrally plan economies.

Jones (2003) proposes that no matter how complex the world becomes, we can still form three basic tenets for how we can operate through politics and government: we should do no harm and not mislead others, or society, we should aim to allow individual and organizational movements and interactions without friction or corruption, and we should not require people to acquire knowledge outside of their area of expertise or attention in a manner that would create inefficiencies. Both authors express a path to either hope and salvation or, if we make the wrong choices, the collapse of good government, leaving us with the darkest page in history. There is no guarantee of good government, nor an easy path to designing institutions that will be operating flawlessly over time.

The world is a messy place, and with any theory, it is essential to ensure that it solves real policy problems. Complexity theory demonstrates that where “the behavior of complex systems is difficult (or impossible) to predict” (Cairney, 2012), small differences in input lead to radically different outcomes. Yet Jones (2003) notes that “bounded rationality and behavioral choice lead to predictions about policy outcomes that imply that organizational outputs will be disjointed and episodic regardless of the input stream and cost structure of the organization”.

Both authors remind us of the difficulty of deciding for other people with the limited information we can possess. In a convoluted world that complexity theory, beyond simple calculation, demonstrates to exist, and which is subject to the constraints of complexity, we can still form some basic tenets on how to live and interact in society and how to be stewarded towards a future that we would all accept. Even where every action comes with unintended consequences, we can establish a few guiding principles that ensure we do not merely give up and act as if we were living in a nihilistic existence. The secret would seem to be to create balance through stewardship, rather than a governing body that shall rule.

References

Cairney, P. (2012). Complexity Theory in Political Science and Public Policy. Political Studies Review10(3), 346–358. https://doi.org/10.1111/j.1478-9302.2012.00270.x

Jones, B. D. (2003). Bounded Rationality and Political Science: Lessons from Public Administration and Public Policy. Journal of Public Administration Research and Theory13(4), 395–412. https://doi.org/10.1093/jpart/mug028

[Image: knowledge by Norbert Kucsera from the Noun Project; Image Source: https://thenounproject.com/term/knowledge/1896949/; https://creativecommons.org/licenses/by/3.0/us/legalcode]