Stephen Monrad

When we trade our labor for money or our money for things, we are making choices. The hope is that we make good choices and our lives improve. Hopefully we get value out of the things we buy.

What is it that counts as improvement? Do we know?

If the purpose of life is to achieve happiness or some other comfortable emotional state, it’s very difficult to tell when progress is being made. Our emotions are a writhing mass that we barely understand. We pursue things that we think might help, but the results are mixed. Was the new flat-screen tv worth the cost? Perhaps in the short term. In the long term, its value can be easily questioned.

Is there any other unifying goal other than happiness that we can pursue? I don’t think so. In practice, I think we end up pursuing a number of separate goals with little real idea of their relative importance. Get food. Buy clothing. Sleep. On simpler objectives like these, we can do a little optimizing. We can think about how effective solutions to specific problems are.

So how do we make big decisions in life if we don’t have a unifying goal to pursue? My guess is that we make the badly. We copy others. We make blind leaps into the unknown from time to time. Many people don’t like change at all because it’s scary. It’s more comfortable to simply maintain existing habits and patterns than to change.

Are our decisions driven by value? I don’t think so. I think we are mostly driven by habit. From time to time we drop some particularly counterproductive behaviors and substitute ones that might be better. What we end up with is a hodge-podge of behaviors that, if we are lucky, work reasonably well.

Over the weekend, I read the book “Kluge – The Haphazard Evolution of the Human Mind” by Gary Marcus. It’s premise is that our brains are the product of evolution. The parts that have been around for a long time work pretty well. The parts that are newer have more problems. Vision and motor control are old, so they are pretty reliable. Language and rational thinking, on the other hand, are new. They have many problems.

One of the main source of problems is how evolution works. It doesn’t discard the old and start from scratch. It builds upon itself over time. For most critters, contextual memory is very useful. If I’m a squirrel and I see a tree branch shake, I want to know what is likely to happen next. The squirrel’s memory is designed to retrieve information relevant to the shaking branch when it sees the shaking branch.

Contextual memory of this sort isn’t the best type of memory for basing rational decisions on. It is better to think through all the data available when making rational decisions instead of considering only what happens to come to mind. We’d be much better off with memory similar to what a computer has. That way, we could ruffle through all of it and know we haven’t missed anything.

Our memory isn’t the only problem. Our whole brain is cobbled together from bits and pieces that have done well in our ancestors. Our expectation should be that our ability to think rationally is limited because our brain is made up of very old components that were useful for other purposes than doing mathematics and logic problems.

The thrust of the book was that if we recognize that our brains are far from perfect, we can do things to try to help ourselves make more rational decisions. I take away something else. The reward systems in our brain are located in the old portions that haven’t changed much over time. What makes sense may not feel particularly good. Our use of logic to make decisions needs to make concessions to the reality that our happiness depends on needs that are primitive.

Work makes up a big chunk of most people’s days. If people don’t like their jobs, it is a major drag on their emotional well-being.

Even if liking work doesn’t increase productivity, I believe it is worthwhile to try to find ways to make people feel better about the work they do. While it may take some thinking to find ways to enjoy work, the breadth of things that people do in their spare time for fun shows that people can enjoy practically any activity. Some people voluntarily ice-fish; tedium in an uncomfortable environment can be fun. Other people run marathons; strenuous activity for extended periods of time is okay. Yet others play chess; tackling tough problems for hours at a time is fun for some.

I bet that almost any activity that people grumble about at work has an analogous hobby that is very similar that people do voluntarily. The problem is to set up the work activities in a way that makes them enjoyable.

One of the main premises of my economic thinking is that pay incentives aren’t needed to motivate workers. To support this idea, I’m going to start reading more about motivation.

I just took a quick look at the Wikipedia article on motivation and found an interesting list of sixteen needs that Professor Steven Reiss believes guide nearly all of human behavior. They are:

1. Acceptance, the need for approval
2. Curiosity, the need to think
3. Eating, the need for food
4. Family, the need to raise children
5. Honor, the need to be loyal to the traditional values of one’s clan/ethnic group
6. Idealism, the need for social justice
7. Independence, the need for individuality
8. Order, the need for organized, stable, predictable environments
9.  Physical Activity, the need for exercise
10. Power, the need for influence of will
11. Romance, the need for sex
12. Saving, the need to collect
13. Social Contact, the need for friends (peer relationships)
14. Status, the need for social standing/importance
15. Tranquility, the need to be safe
16. Vengeance, the need to strike back

Without using pay incentives, jobs can help people meet their need for acceptance, curiosity, honor, idealism, independence, order, physical activity, power, social contact, status, and tranquility. Any given job probably won’t help meet all of these needs. However, it is reasonable to expect that almost all jobs could help workers meet at least one or two of these needs.

If a job can be made to satisfy some of a worker’s needs, perhaps pay incentives aren’t needed to get them to exert themselves.

Lots of people buy lottery tickets each week in the hopes of winning millions of dollars. This behaviour is strange because it is time consuming to stand in line to buy the tickets, keep track of them and check them when the numbers are drawn. Since standing in line and keeping track of bits of paper isn’t much fun, you think people would be more efficient with how they gamble.

For example, if you plan to buy a lottery ticket for a dollar each week, you will buy 52 tickets over the course of the year. You could save yourself a lot of bother by buying the 52 tickets all at once for one draw. Your chances of winning would be exactly the same. Why do we make the extra 51 trips when they are totally unnecessary?

The answer of course is that people are irrational. People buy lottery tickets each week because it gives them hope that their life might be transformed soon. All the worries and fears that plague them could be brushed aside if the right numbers are drawn. Lotteries sell a dream. Your life might be transformed in a few days if you buy a ticket.

What bothers me most about the dream being sold is that it encourages people to be passive. Instead of hoping for a miracle, people should take a more active role in improving their lives. While lotteries may appear harmless, the advertising used to promote them encourages people to be passive and disengaged. I think we need better dreams.

Instead of dreaming of winning the lottery, we should dream of finding pleasure in the simple things in daily life. We should dream of meeting new and interesting people. We should dream of making the world a better place. These dreams encourage us to reach out and take risks. Dreams that encourage us to engage help us grow and have a much better chance of bringing us happiness.