Brigid Slipka

…writings on giving & living

When Theories are Wrong

November 15th, 2010 · No Comments · Economics, Living Well

Theories are lovely.  They are neatify the world, project order on to a myraid of disparate behaviors, allow educated guesses at what the future holds.

But there is no theory, ever, that explains everything that it claims it does.  Some square-shaped action will not fit into that round-shaped reasoning. When this happens, proponents of the theory respond one of three ways:

1. Label the square-shaped actors as stupid.

They usually say it more kindly than using the word “stupid” but if you pick at it, that’s kinda what they mean.

The popular turn of phrase among finance and econ guys is to describe behaviors that don’t fit their models as “irrational.” Even when every consumer in the world acts in a way different from what the theory would predict (such as accepting a free cheap product rather than a more-deeply-discounted quality product) they still don’t question the theory but are baffled by the consumer.

2. Label the square-shaped actors as ignorable exceptions.

Newton’s second law of thermodynamics is the very firm theory that stuff spreads out to fill the space and doesn’t return to its original state (example: heat spreads through a room until it’s equally dispersed but never reverses back to a big clump by the vent).

Except:


(h/t kottke)

Folks will look at this, say “Wow!” and promptly ignore it. Nothing will change in post-doctoral studies or engineering departments or physics textbooks.  It’s an interesting but ultimately ignorable blip.  The Second Law will be impervious.

3. Change the theory.

Rather than forcing outliers into the Newton’s Laws, Einstein changed the theory: Laws of physics are relative.

Rather than chucking aside the rare outliers, Nassim Nicholas Taleb chucked aside the theory that outliers are rare.

Both of these gents said: It’s possible that entire world is wrong.  But it’s far more probable that the theory is.

We can learn pretty much everything about a theory from school & newspapers & social media except for that extraordinarily salient fact that the theory is just made up.  All theories are.  We make them up for good reasons: to help create policy and build skyscrapers and plan for retirement.

But at the edges of their usefulness, theories stop showing us the true nature of the world and instead start showing us the true nature of ourselves.

Tags: ···

No Comments so far ↓

Like gas stations in rural Texas after 10 pm, comments are closed.