Small Theories and Large Risks—Is Risk Analysis Relevant for Epistemology?

Ought we to take seriously large risks predicted by “exotic” or improbable theories? We routinely assess risks on the basis or either common sense, or some developed theoretical framework based on the best available scientific explanations. Recently, there has been a substantial increase of interest in the low‐probability “failure modes” of well‐established theories, which can involve global catastrophic risks. However, here I wish to discuss a partially antithetical situation: alternative, low‐probability (“small”) scientific theories predicting catastrophic outcomes with large probability. I argue that there is an important methodological issue (determining what counts as the best available explanation in cases where the theories involved describe possibilities of extremely destructive global catastrophes), which has been neglected thus far. There is no simple answer to the correct method for dealing with high‐probability high‐stakes risks following from low‐probability theories that still cannot be rejected outright, and much further work is required in this area. I further argue that cases like these are more numerous than usually assumed, for reasons including cognitive biases, sociological issues in science and the media image of science. If that is indeed so, it might lead to a greater weight of these cases in areas such as moral deliberation and policy making.     

Competitive envy-free division

We are concerned with a fair division problem in which the indivisible goods to be distributed among a finite number of individuals have divisible bads associated with them. The problem is formulated and analyzed in terms of the housemates problem. We present an efficient procedure that decides whether an envy-free solution exists, and if so, finds one of them; otherwise finds a solution such that each envious housemate is assigned a room whose rent is zero.     

Rational Choice Theory or Pretense? The Claims,Equivalences, and Analogies of the “Economic Approach to Human Behavior”

The article argues and demonstrates that classical–neoclassical economics generally does not pretend or claim that its principles apply to domains beyond the economy, specifically wealth, and does not equate the economic and the noneconomic, and the rational and the nonrational. By contrast, the “economic approach to human behavior” or “rational choice theory” precisely does this to legitimize itself by invoking classical–neoclassical economics as supreme authority and its representatives as venerable precursors. The article reveals the economic approach to human behavior as a set of grand theoretical and methodological claims, equivalences, and analogies from the standpoint of conventional economics itself, as well as sociology and other social sciences. It identifies and examines certain indicative instances of such tendencies. The article aims to contribute to understanding better the relations—or rather lack thereof—between conventional economics and contemporary economic and sociological rational choice theory. The economic approach to human behavior is not new, even outside the market sector. The rational choice model provides the most promising basis presently available for a unified approach to the analysis of the social world by scholars from different social sciences. — Gary Becker With respect to those parts of human conduct of which wealth is not even the principal object, to these political economy does not pretend that its conclusions are applicable. — John S. Mill But economy does not treat of all human motives. There are motives nearly always present with us, arising from conscience, compassion, or from some moral or religious source, which economy cannot and does not pretend to treat. These will remain to us as outstanding and disturbing forces; they must be treated, if at all, by other appropriate branches of knowledge. — William Jevons A science, therefore, based on the hypothesis (of universal rationality) would yield a general form of the social phenomenon having little or no contact with reality … — Vilfredo Pareto     

Behavioral economics and the economics of Keynes

The aim of this paper is two-fold: it first evaluates some of the psychological insights offered by Keynes in his economic theories, and secondly it weighs up these insights in the light of recent research in behavioral and experimental economics. We found that many of the psychological ideas set forth by Keynes in his economic works, especially in The General Theory, have a defensible behavioral foundation and fit broadly the actual behavior of economic agents in the real world as suggested by recent empirical evidence. As a consequence, we argue that Keynesian economics can benefit from this interaction, especially for issues related to judgment under uncertainty and building solid microfoundations for macroeconomics.     

Social Aspects of Sustainable Competitiveness in the Selected European Countries in the Period 2012–2015

Social Indicators Research - The paper examines the impact of the social dimension of sustainable competitiveness on the economic dimension, where the social dimension is represented by Indicators...     

An Empirical Bayes Inference for the von Mises Distribution

This paper develops an empirical Bayesian analysis for the von Mises distribution, which is the most useful distribution for statistical inference of angular data. A two-stage informative prior is proposed, in which the hyperparameter is obtained from the data in one of the stages. This empirical or approximate Bayes inference is justified on the basis of maximum entropy, and it eliminates the modified Bessel functions. An example with real data and a realistic prior distribution for the regression coefficients is considered via a Metropolis-within-Gibbs algorithm.     

The Merton Theorem Revisited and Restated: Conservatism and Fascism as Functional Analogues

The paper revisits and restates the Merton Theorem of American religious conservatism (Puritanism) and European fascism (Nazism) as functional analogues. The original formulation the Merton Theorem identifies and describes them as functional analogues in nativism or nationalism through exclusion of and aggression against non-native out-groups. The paper offers an extended restatement of the Merton Theorem in which American conservatism and European fascism function as functional analogues in that both represent the model of a closed, or the antithesis to an open, society, of which nativism is a special case. In the extended Merton Theorem they are functional analogues specifically in terms of such indicators or dimensions of a closed society as political absolutism, closure and oppression, religious absolutism and nihilism, moral absolutism and repression, and extremism.     

Anthropic Shadow: Observation Selection Effects and Human Extinction Risks

We describe a significant practical consequence of taking anthropic biases into account in deriving predictions for rare stochastic catastrophic events. The risks associated with catastrophes such as asteroidal/cometary impacts, supervolcanic episodes, and explosions of supernovae/gamma‐ray bursts are based on their observed frequencies. As a result, the frequencies of catastrophes that destroy or are otherwise incompatible with the existence of observers are systematically underestimated. We describe the consequences of this anthropic bias for estimation of catastrophic risks, and suggest some directions for future work.