One interesting thing about cognitive biases - they're the subject of so many books these days. There's the Nudge book, the Sway book, the Blink book, like the one-title book, all about the ways in which we screw up. And there are so many ways, but what I find interesting is that none of these books identify what, to me, is the single, central, most important way we screw up, and that is, we tell ourselves too many stories, or we are too easily seduced by stories. And why don't these books tell us that? It's because the books themselves are all about stories. The more of these books you read, you're learning about some of your biases, but you're making some of your other biases essentially worse. So the books themselves are part of your cognitive bias. Often, people buy them as a kind of talisman, like "I bought this book. I won't be Predictably Irrational." It's like people want to hear the worst, so psychologically, they can prepare for it or defend against it. It's why there's such a market for pessimism. But to think that buying the book gets you somewhere, that's maybe the bigger fallacy. It's just like the evidence that shows the most dangerous people are those that have been taught some financial literacy. They're the ones who go out and make the worst mistakes. It's the people that realize, "I don't know anything at all," that end up doing pretty well.
So if I'm thinking about this talk, I'm wondering, of course, what is it you take away from this talk? What story do you take away from Tyler Cowen?
I'm really not sure, and I'm not here to tell you to burn your DVD player and throw out your Tolstoy. To think in terms of stories is fundamentally human. There's a Gabriel García Márquez memoir, Living to Tell the Tale, that we use stories to make sense of what we've done, to give meaning to our lives, to establish connections with other people. None of this will go away, should go away, or can go away. But as an economist, I'm thinking about life on the margin. The extra decision: should we think more in terms of stories, or less in terms of stories? When we hear stories, should we be more suspicious? and what kind of stories should we be suspicious of? Again, I'm telling you it's the stories that you like the most, that you find the most rewarding, the most inspiring. The stories that don't focus on opportunity cost, or the complex, unintended consequences of human action, because that very often does not make for a good story. So often a story is of triumph, of struggle; there are opposing forces, which are either evil or ignorant; there is a person on a quest, someone making a voyage, and a stranger coming to town. And those are your categories, but don't let them make you too happy.
So as an alternative, at the margin (again, no burning of Tolstoy), just be a little more messy. If I actually had to live those journeys and quests and battles, that would be so oppressive to me! It's like, my goodness, can't I just have my life in its messy, ordinary - I hesitate to use the word - glory? It's fun for me - do I really have to follow some kind of narrative? Can't I just live? So be more with comfortable with messy. Be more comfortable with agnostic, and I mean this about the things that make you feel good. It's so easy to pick a few areas you're agnostic in, and then feel good about like, "I'm agnostic about religion, or politics." It's a kind of portfolio move you make to be more dogmatic elsewhere, right? Sometimes, the most intellectually trustworthy people are the ones who pick one area, and they're totally dogmatic in that. So pig-headedly unreasonable you think, "How can they possibly believe that!?" But it soaks up their stubbornness, and then on other things, they can be pretty open-minded. So don't fall into the trap of thinking because you're agnostic on somethings, that you're being fundamentally reasonable about your self-deception and your stories and your open-mindedness.
This idea of hovering, of epistemological hovering, and messiness, and incompleteness, and not everything ties up into a neat bow, and you're really not on a journey here. You're here for some messy reason or reasons, and maybe you don't know what it is, and maybe I don't know what it is, but anyway I'm happy to be invited, and thank you all for listening.