To my best knowledge, neuroeconomists never refer to Friedrich Hayek as founder of their discipline. But he should be included at least in the list of the most important intellectual progenitors. His 1952 book ‘The Sensory Order’ is a highly abstract philosophy of the brain, came surprisingly close to Hebb’s emerging paradigm of connectionism, and it anticipated Gerald Edelman’s theory of ‘neuronal group selection’, as Edelman himself later recognized. The book does not deal with economics, but Hayek always asserted that it laid the ground for his epistemology and methodology of economics.
The central idea of the book is to conceive the brain as an evolutionary and, in some modern terminology, ‘autopoetic’ system. This points to a possible, albeit fundamental misunderstanding of the brain in most mechanistic reconstructions of the neurosciences. Mechanistic models assume that there are chains of cause and effect that work together in producing an outcome. Hayek’s and Edelman’s theory suggest a very different picture: Cause and outcome are connected via complex evolutionary mechanisms. What does that mean?
It means that once a sensory input and trigger for behaviour arrives, the brain would generate a wide range of alternative trajectories producing various outcomes simultaneously. These trajectories would compete against each other, until one would prevail, and effectively generates behaviour. The mechanistic misunderstanding of this happens because ex post only the ‘survivor’ is visible, and all alternative trajectories are lost. This is a ‘winner takes all’ scenario which seems very wasteful. Why would such a system evolve by natural selection?
I think that this connects with the extreme complexity of human social interaction. Even in simplest situations, misunderstanding is possible, and often minor causes might escalate to serious conflicts. That means, adaptive behaviour would need to rely on very fast feedback circuits in order to finetune outcomes and avoid mis-coordination. This cannot be achieved by a system that would operate sequentially, i.e. first launch one trajectory, then correct errors, and launch another trajectory. Waste is efficient here: The brain launches many alternatives simultaneously, and via feedbacks ultimately one is selected.
The point is that evolutionary mechanisms allow for the simultaneous choice of means and goals, whereas the standard neuroeconomic model takes goals as a given. In even simple situations of social interactions, goals can be multiple and opaque. This is important when analysing addiction, for example. Drinking a whiskey at the bar together with others can have many functions at the same time, not just taking up a certain does of alcohol, but, for instance, signalling friendship or lowering social distance. The point is that which goal dominates cannot be planned in advance, so ‘choice’ is not just choosing the means, but also the goal.
In my view, many issues in neuroscience and neuroeconomics can be approached in a new and productive way. Just a few examples. First, attention is a central aspect of human behaviour: In the evolutionary view, attention creates the specific niche in which the evolutionary mechanism unfolds. Second, there are many phenomena of relapse and rapid recovery of apparently ‘unlearned’ behaviour, but also sudden and unpredicted switches: If we assume that always many trajectories are present simultaneously, this is straightforward to explain, because evolutionary processes have a complex-dynamics with tipping points, multiple equilibria and more. Third, there is the intriguing discovery of the default mode system which has the surprising property of reduced activity once action sets in: In the evolutionary view that is to be expected because once one trajectory materializes, all others close. Fourth, human individuals have the property of being creative and they feel free, which is often seen in tension with neurophysiological causal determinism: In the evolutionary perspective, this freedom reflects the wide range of possible trajectories that might be triggered by external inputs.
To sum up, mechanistic philosophy of the neurosciences and neuroeconomics should go back to Hayek’s ideas and establish an evolutionary framework for causal analysis. As I will argue in the next post, this also means, again following Hayek, to connect evolutionary mechanisms in the brain with evolutionary mechanisms in the social world.
(This post builds on my chapter in the INSOSCI volume that we currently prepare for publication.)