Four projects in the intellectual history of quantitative social science

1. The rise and fall of game theory.

My impression is that game theory peaked in the late 1950s. Two classics from that area are Philip K. Dick’s “Solar Lottery” and R. Duncan Luce and Howard Raiffa’s “Games and Decisions.” The latter is charming in its retro attitude that all that remained were some minor technical problems that were on the edge of being solved. In retrospect, I think that book from 1958 represents the high-water mark of the idea of game theory as an all-encompassing tool in social science. Game theory has seen lots of important specific advances since then but its limitations have become clearer too. (See, for one small example, my article, “Methodology as ideology: some comments on Robert Axelrod’s ‘The Evolution of Cooperation,’” published in 2008 but originally from 1986, making a point also made by Joanne Gowa in that year.)

The intellectual history project here is to trace game theory and decision theory from their heights in the 1940s (when game theory and operations research were used by the U.S. military to help win World War II), to Peak Game Theory in the 1950s (when it seemed that we were on the cusp of solving all the important problems of international conflict and social choice, as epitomized by someone like Herman Kahn, who we know recognize as a buffoon but who it seems was considered a serious thinker back in his day), to the business decision making era of 1960s-70s, to the modern day, in which game theory is a particular subfield of political science and economics with continuing developments but no longer viewed as a sort of master key to understanding and solving social problems.

2. The disaster that is “risk aversion.”

I’ve written about this several times before (2005, 2008, 2011, 2014, 2018 “It would be as if any discussion of intercontinental navigation required a preliminary discussion of why the evidence shows that the earth is not flat.”

In particular see this post from 2009, “Slipperiness of the term ‘risk aversion’” and this from 2016, “Risk aversion is a two-way street.”

For the point of this intellectual history, the point is not to criticize naive ideas of risk aversion that are held within the economics profession, but rather to ask how it was that this problematic model became the default. (Just for an example, go to Amazon, look up Mankiw’s Principles of Economics, Search Inside on “averse,” and go to Figure 1 on page 581.)

3. From model-based psychophysics to black-box social psychology experiments.

I think there’s an interesting intellectual history to be done here, tracing from “psychophysics” and “psychometrics” from circa 100 years ago which uses physics-inspired mechanistic or quasi-mechanistic models, to “behaviorism” from circa 80 years ago whose models seem to me to be more Boolean-inspired (do X and observe Y), to “judgment and decision making” from circa 50 years ago whose models were derived from psychophysics, to “behavioral economics” and “evolutionary psychology” which are typically studied in the way that ESP has been studied for so many years, using null hypothesis significance testing with any underlying model being a black box of no inherent interest.

There are two interesting things going on in this particular intellectual history: first, the idea that “social psychology” / “evolutionary psychology” / “behavioral economics” is in many ways a conceptual step backward in psychology, a denial of the cognitive revolution and a return to the black-box modeling associated with the pre-cognitive behaviorism of the 1940s. Second, there is the specific issue discussed in this thread that, although “judgment and decision making” directly derives from “psychophysics,” the mathematical and statistical modeling in modern JDM is typically much cruder than the models used in classical psychophysics and psychometrics.

This came up in this discussion thread.

4. The two models of microeconomics.

Pop economists (or, at least, pop micro-economists) are often making one of two arguments:
(a) People are rational and respond to incentives. Behavior that looks irrational is actually completely rational once you think like an economist.
(b) People are irrational and they need economists, with their open minds, to show them how to be rational and efficient.

Argument a is associated with “why do they do that?” sorts of puzzles. Why do they charge so much for candy at the movie theater, why are airline ticket prices such a mess, why are people drug addicts, etc. The usual answer is that there’s some rational reason for what seems like silly or self-destructive behavior.

Argument b is associated with “we can do better” claims such as why we should fire 80% of public-schools teachers or Moneyball-style stories about how some clever entrepreneur has made a zillion dollars by exploiting some inefficiency in the market.

The trick is knowing whether you’re gonna get a or b above. They’re complete opposites! I blogged about this in 2011 and it’s come up several times since then. The intellectual history question is how this happened, and how this is perceived within the economics community. This is related to the analogy between economics now and Freudian psychiatry in the 1950s, and also related to discussions of the political implications of various social science theories.

There are other questions of intellectual history I’d like to study, but the above four are a start.