Tag Archives: information

Levinson on primitive economies of information

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Ndap y Ke Rossel

Rossel Island shell currency.

An excerpt from Stephen C. Levinson, “Interrogative Intimations: On A Possible Social Economics of Interrogatives” in Questions. Formal, Functional and Interactional Perspectives. ed. Jan P. de Ruiter. Cambridge: 2012.

Levinson sketches a model of conversation in which interlocutors measure both the semantic and the social value of information. In this scheme, the semantic measure would be apportioned in units called Carnaps (after philosopher Rudolf Carnap), the social in Goffman units (after sociologist Erving Goffman). The Goffman measure involves ongoing estimations of position relative to others, social costs (which might explain the reluctance, say, to ask a question), authority, expertise, and so on. It underwrites a “micropolitics” of conversation.

Levinson offers an analogy with the shell money system of Rossel Island, in Papua, New Guinea.

An economic model of social information transfer is not going to look like a modern market economy. It might perhaps have some passing resemblance to the “primitive” economics of pre-industrial societies, with multiple measures for specific goods (bushels and grosses, cords and cubits), and multiple barter and exchange systems. Take the so-called shell money system of Rossel Island…, which consists of twenty-odd denominations of shells, with no exact equivalences of value and a delimited arena in which they can be used — it offers only the faintest semblance of a market economy (the shells are usable, e.g., for bride price, the purchase of pigs, houses and canoes, but not for food or manual labour). Shells are stores not only of economic but of social value, and top shells have names, like the Koh-i-noor diamond. Gaining possession of an individually named shell is like being temporary owner of a Picasso: it is an individual, not a mass of multiple undifferentiated tokens, and it reflects glory on its owner. Large injustices and delicts can be atoned for by the assuaging properties of such shells, even if only on loan for a fortnight. Shells go in one direction in exchange for goods, services and immaterial benefits (like forgiveness) in the other; but because there is constant flow in both directions, and shells are borrowed from all and sundry with intended eventual repayment, the market is about as murky as subprime derivatives. Such a system, with a multitude of special factors, frictions and exuberant irrationalities, offers us a better picture of the economics of everyday social life than textbook market economics.

It also moves us well beyond the transactional “ask-bid” model of conversation I described, and found wanting, in an earlier post.

Dennett on Sunlight

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Here’s my transcript of what I consider one of the more striking moments in the conversation with Steven Pinker and Daniel Dennett moderated by Alex de Waal at the “Unlearning Violence” conference held at Tufts’ Fletcher School in February. (A video of the discussion in its entirety follows.) Daniel Dennett is speaking:

Something’s happened, which is absolutely unprecedented in the history of civilization, which is a major — I think a major change. And yes it’s the internet and electronic communication. But what it has done, it has rendered the epistemological atmosphere in which we live transparent in a way it never was before.

There’s a lovely book — speculative book by Andrew Parker, a zoologist in Oxford, who [in In The Blink Of An Eye: How Vision Sparked The Big Bang Of Evolution], argues, very plausibly, that the cause of the great Cambrian explosion, this huge outpouring of new life, that the trigger for that was the transparency, the sudden, relatively sudden growing transparency of the oceans and the air, making sunlight available and making vision possible for the first time. And it was the immediate evolution of eyes which changed everything, because now predator could see prey, prey could see predator, and if you didn’t have eyes you were sunk. And this set off a five million year arms race of sort of guerilla warfare enhancements, defense and offense, and that’s what created all the remarkably different body types and behavioral types and defense types that mark this great explosion.

Well, he may or may not be right about that, I — I — it’s one of those evolutionary ideas that I am very fond of but I haven’t committed to it because it hasn’t been shown yet. But it’s a plausible and pretty well researched theory. Whether he’s right or wrong, I think something exactly like that has happened now.

All the institutions in human culture, not just religions but armies, governments, banks, relig- uh, corporations, clubs — they have all evolved in a relatively murky epistemological atmosphere where people could be relatively ignorant of things at a distance around the world and even about a lot of their own, the features of their own organizations. And organizations evolved to exploit that ignorance, cause it was — you could rely on it. That ignorance is evaporating at a colossal rate, and we see it, we see it in Edward Snowden. We see it where the security experts are now saying there’s no such thing as a firewall, um, because people, you have to rely on people’s fidelity, because people’s fidelity is infinitely malleable by memes, by all of the information that is floating around in the internet.

Religions: what this new transparency does is, it renders knowledge not just widespread but mutual: it’s not just that everybody knows that p, it’s that everybody knows that everybody knows that p.

Fifty years ago, I’m sure, there were millions of Catholics that knew of a priest who had molested some boys. Millions of them. But nobody knew there were millions of them. Now, millions of Catholics know that millions of Catholics know. And that changes everything. Now, you have a Bishop giving a press conference where he makes a big point of saying you’ll note how I never, whenever there’s a young boy around I’ll always have my hands in front of me. Can you imagine a bishop of the church saying anything like that fifty years ago?

This is an awkward and gauche and ineffective response to the new transparency. Well I think that in itself is going to force every institution in the world to evolve very quickly or go extinct.

And what that does for violence is — it’s not clear. In some ways it may be a great diminution in violence; on the other hand it may unleash forces that we don’t even imagine yet, and make new inroads into violence more likely.

Another misattribution: be careful out there!

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It happened again today. Just now, a philosophy Twitter bot posted this quotation, attributing it to Cicero.

A noble sentiment. As of this writing it’s been retweeted 54 times and favorited 16, just an hour or so after it was first posted.

The only trouble is, these are not the inspiring words of the orator and statesman Cicero, but the words of Orfellus, “a peasant, a philosopher unschooled and rough,” as rendered by the poet Horace at the close of Satire II.ii.

Like Horace himself, Orfellus was dispossessed of his property; and he understands that neither he nor the new landlord, Umbrenus, has a legitimate claim to the land. It belongs to “no one for good,” but is ceded for use (cedet in usum). The Loeb trot continues:

Nature, in truth, makes neither him nor me nor anyone else lord of the soil as his own. He drove us out, and he will be driven out by villainy, or by ignorance of the quirks of the law, or in the last resort by an heir of longer life. Today the land bears the name of Umbrenus; of late it had that of Orfellus; to no one will it belong for good, but for use it will pass, now to me and now to another. Live then, as brave men, and with brave hearts confront the strokes of fate (quocirca vivite fortes / fortiaque adversis opponite pectora rebus).

I can’t figure out the source of the confusion, how or where the quotation came to be attributed to Cicero, how Cicero’s prose and Horace’s verse could be confused, and I don’t really know what to make of it all, except to reiterate that most books of quotations and nearly all quotation bots and sites proffering quotations are borrowing, cutting and pasting, or sloppily compiling from other compilations, and never working from original sources. Maybe that sort of spadework went out with the keeping of commonplace books. No matter, don’t trust any attribution that doesn’t cite chapter and verse; and even then, verify.

And if fortune is averse, front its blows with brave hearts. No, that’s not Mel Gibson.

‘Mr. Rajaratnam seemed in good spirits’

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That was the report from a “friend” on October 20th. Whether Mr. Rajaratnam’s good spirits have held up despite recent events — which have ranged from the collapse of his firm, the Galleon Group, to accusations that he was funding the Tamil Tigers — is less clear; but perhaps Mr. Rajaratnam knew all along that that he had friends out there, and that his friends would rise to his defense. No need to be glum.

Friends of Raj have included, so far, a number of prominent newspaper columnists and professors of law and finance, as well as, it would appear, the entire editorial staff of The Wall Street Journal.

Most are not defending Mr. Rajaratnam himself: nobody, not even his closest friends, have stepped up to declare him innocent or incapable of any wrongdoing. Instead, we are asked to consider that what the Feds call insider trading is really another form of market transparency, or alternatively, that it is, or ought to be, perfectly legal for outsiders to trade on information provided by insiders, even if those insiders betray their fiduciary duties in providing that information.

The latter of these arguments could amount to little more than this: if you tell me a secret, and I act on that information, you may have violated a trust, but I have not. I have only acted in my own self-interest, and what else can you expect me to do? Of course this conveniently overlooks the question how I induced you to tell me the secret, or how I colluded with you in violation of a trust. Any investigation of wrongdoing at Galleon will likely focus on whether there were inducements in Mr. Rajaratnam’s network of informants and contacts, or what form collusion took. After all, we’re not really being asked to believe that these were just friendly exchanges.

Or are we? Mr. Rajaratnam cultivated friends in high places and friends with access to proprietary information, to be sure. And as L. Gordon Crovitz noted in a piece that tries to blur the line between insider and outsider trading:

Information flows these days are increasingly about networks, including information about markets shared by members of various communities. Traders use Web sites to compare notes on companies and use social media like Facebook to share information, looking for an edge. Sophisticated traders such as hedge funds draw on more selected networks such as their investors.

The word “community” is doing a lot of work here it shouldn’t do. And it’s a little hard to imagine an entire hedge fund entrusted to the fortunes of six-degree, social media friendships. The role these informal exchanges played in giving Galleon the “edge” that Mr. Rajaratnam insisted upon is most likely negligible. Instead, it seems fair to assume, Mr. Rajaratnam and his associates depended on what Crovitz calls “more sophisticated” social information networks. (If you like acronyms, call them SINs). How sophisticated, and how social, remains to be seen.

The other argument, the argument about market transparency, is usually attributed to Milton Friedman (but originates, according to Stephen Bainbridge, with Henry Manne). Friedman summed it up when he quipped: “you should want more insider trading, not less. You want to give the people most likely to have knowledge about deficiencies of the company an incentive to make the public aware of that.” The merits of this view aside — and Bainbridge has argued persuasively that its merits are slim — it paints a deliberately naive picture of the markets, with knowledgeable insiders merely lacking some incentive to inform “the public” of a company’s deficiencies.

The public? It’s difficult to say why Friedman should choose this word. No doubt about it, inside information about a company’s shortcomings, or failures, or misdeeds can serve the public, or be a public good; and in a perfect world, or even a better world, there might be real incentives and protections for those who come forward with information about companies that serves the public interest. But in our world, in the real world, who among the public, broadly construed, the publicus, would benefit from this kind of information, or even know how to benefit from it?

It’s a very small percentage of the public, and it is disingenuous to pretend otherwise. It’s a “community,” to use Crovitz’s word. But the trouble is this: this particular community is like a gated enclave, restricted, shut off from the traffic and noise of the public world. Just Mr. Rajaratnam and friends — nobody else; a very small, very closed circle, a social information network, to which only a select few are privy.

There are, no doubt, many such networks of friends and boon companions where the line between inside and outside is blurred: after all, friends don’t let friends stay out in the cold. But these social information networks are still a long way from true transparency and public disclosure, or information that is a public good, even though we have all the technology we need to make information public. What we lack is the political intelligence to do it right, or maybe just the political will to do it at all.