[Herbert Simon] How humans can make rational choices? (Reason in Human Affairs)

Roughly speaking

1. A story about limited rationality that is familiar to all academic subjects, as well as Herbert-Simon, a genius scholar who is well-versed in all fields of study.
2. Overconfidence in reason and the persuasiveness of Hitler's "my struggle."
3. The idea of ​​rationality (superhuman model, behavior model, intuition model, evolutionary adaptation model)

Herbert-Simon

How do people judge in a diverse and complex world?

In a world where there are no answers every day, people continue to wander, thinking that it's not a thing or anything like that.

This story often appears in the lyrics of songs, but what do you think?

I always go to the supermarket and buy the items, thinking that it might be reasonably cheap or that it would be worth buying.

Even for luxury items such as cars, I somehow decide that minivans would be better, so I look at a few companies and decide.

Even if it's a life decision, there is a view that how much challenge you should try, depending on your occupation or age, and that you will calm down at this age.

In fact, people do not make rational decisions about most decisions after considering all options. In fact, perfect rationality may be a fantasy. But on the other hand, it's not that I can't see the future at all.

Herbert-Simon modeled this mechanism of decision making with a certain degree of rationality, consistent with human experiences, as economics, and won the Nobel Prize in Economics in 1978.

Before Simon, business administration has been considered based on the assumption that decisions about how managers decide on purchasing and production.

For the first time, Simon attempted practically modeling the limits of human rationality.

This time we will introduce Simon's 1982 lecture material, "Reason in Human Affairs."

This was used in the lecture commemorating the Harry Camp at Stanford University, and there is a Japanese book published, but since the Japanese translation is terrible, we will introduce the PDF version that Yamagata Hiroo has retranslated.

To put it in advance, this document was personally the most difficult to understand, but it was the best review. Simon is probably the only one who can summarise this diverse academic field of rational human decision-making into a single discussion.

However, it was very difficult to understand because the discussion required a high level of knowledge and extensive assumptions. After reading it three times in detail, I finally managed to understand the meaning of the entire text properly after reading it two times.

Particularly, the second chapter, which discusses human rational decision-making from Darwin's theory of evolution, is a spectacular work. Every time I read a sentence, I have a series of "haha" experiences. It makes me snarl. I would like to be able to have this kind of discussion.

Thanks to this, I am currently devouring to read "Management behavior", which Simon wrote for himself. This is even more amazing, but please refer to it in a separate article.

Although I would like you to read this material this time, I would like to explain the material in an easy-to-understand manner.

However, the discussion is too deep to cover, so this time I will focus on Chapter 1, "various views of rationality."

Overconfidence in Reason and Hitler's Persuasiveness

First, Simon reveals the current situation where human rationality is so trustworthy.

Reason seems quite healthy at first glance. However, reason only works when it is constructed based on assumptions and come to some kind of view or conclusion, and is by no means absolute.

For example, seeing some white swans can lead to the view that swans are white. Human reason is amazing that it can construct and understand this.
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However, when a black swan appears, the white swan, which is the premise, collapses.
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This is also said to be proof of the devil, and the positive view of "a" that cannot necessarily be defeated by the view that "a" cannot be said to be "a."
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This means that it is impossible to draw a conclusion that can be said to be absolutely correct. Here you can see the limit.

Reason is merely a tool to draw some kind of certain conclusion from the assumption that it cannot be said to be absolutely correct, and overconfidence is prohibited.

Nazi Germany is an example of how this overconfidence in reason and the beauty of reasoning led to the public's passion, and society as a whole has become passionate, and concrete examples can be found in his book "My Struggle."

In our struggle, it is passionately talked about how Germans must be eroded by Jews and Marxism, and how the Germans must regain the pride they have lost.

We now know that Hitler's eugenic ideas and the movement to exclude Jews are incorrect, but if we listen to them in the painful situations of the Germans at the time and in sympathy with Hitler's passion, we would be enthralled with Hitler.

What Hitler is wrong is the misconception that Jews are the root of all evil, and that Jews and Marxists are unfairly trying to exclude Germans, and the derivation from premise to conclusions is hot and beautiful.

If you make the input wrong, you will only produce the wrong output. In other words, in order to properly guide rationality, it is important to have the right values.

Human rationality, four models

If correct values ​​are needed to utilize ration, how should humans make effective use of ration among the many diverse values ​​in modern times?

Simon presents four models of how this rationality is used, namely, the rationality produced by humans.

Subjective Expected Utility Model (Model that maximizes merit)

First, there is a subjective expected utility model used in classical economics. This is a basic model in which people make choices that maximize the benefits.

If it's production, choose something that's efficient and if it's priced, choose something that's cheap.

It's easy to understand, but there are pitfalls. This is more of a superhuman model than a human.

The subjective expected utility model places the impossible assumption that humans have access to all information and that they can come to conclusions after examining all of the myriad options.

In fact, the reason why subjective expected utility models do not match reality is that they are models that are extremely simplified reality, or because they emit results that ignore the locality of being able to access any information.

Behaviorism Model

In opposition to the above-mentioned superhuman model, the activist model assumes that human rationality is largely limited by situations and human calculation power.

This model involves humans somehow survive by using a certain limited knowledge, and aiming to acquire information through actions in order to connect their lives.

When looking for a good property, humans are aware of limited rationality, so they narrow down the selection of Sumo or the area they want to live in.

Trying to simplify and understand information even if you don't understand it.

Intuition Model

The third is the Aha experience, the intuition model.

Often, a kind of inspiration can lead to excellent conclusions. I don't know where it will come from, but I'm sure I'll come across it in the toilet, shower, or in the park while walking.

According to previous research (although it is as of 1982), humans need 10 years in a certain field of expertise to acquire intuition models.

The inspiration of artists, inventors, researchers and Steve Jobs seems to be that they accumulate a lot of knowledge every day, and although they don't understand why, they can unconsciously come to excellent conclusions.

Evolutionary adaptation model

The second and subsequent chapters of this lecture material will be featured on evolutionary adaptation models based on Darwin's theory of evolution.

This is a story that rationality can be achieved when a life form that has changed and tried to adapt in a certain environment acts as if it is rational.

It's difficult to imagine, but the episode of Microsoft, which broke the idea of ​​IBM and won a contract when it was able to create an OS, could be a typical example.

It's a story that pretending to be able to do it and acting like you can, you can really do it.

Side note

As mentioned in my previous article, business administration scholar Fujimoto Takahiro told Simon that "the conversation about business administration usually comes down to Simon."

I was a Fujimoto seminar student in university, so I think I've heard it 10 times.

It was a seminar that was a top-class last train, but with work style reforms, I wonder if it is a seminar that is now in peace.