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Jumping right in: I’ve been thinking about aggregation a lot lately. 

To a limited degree we understand some of the paradoxes of aggregation. For example, everyone knows that a camel can withstand x number of hay straws, but x+1 will break the camel’s back. The sum of the parts may not be the same as the value of the whole. We know that a group of people behave differently than any one of the individuals would behave alone in an otherwise similar situation. We know these things but we have difficulty extending–not to say extrapolating–these principles out further. Much further.

In 1912, the Dow Jones Industrial Average (DJIA) was $80 a share. Today it sells for over $13,000 a share; a 162,500% increase [4]. Adjust for inflation and population and you still have astronomical growth. By more objective measures, standard of living (whatever that means) has risen upwards of 10 times over in the last 100 years [2][3]. But are we happier? By most measures…no. We’re not [1]. Depression rates are indubitably higher now than they they were 10, 20, 30, 100 years ago (debate of overdiagnosis vs. increased rates vs. improved awareness aside). We don’t have the same sense of community we used to and we seem to have lost a sense of identity [5]. For what I believe is conclusive evidence, if a little trite, that we, as a culture have gotten shallower as a culture–and therefore less happy [6]–we need only turn the channel to a reality TV show to see how empty our lives have become that we pay (with time) to see stupid people being stupid (Jersey shore makes money; I rest my case). So clearly, growth for the sake of growth isn’t what we really want, or at least what we really need. If it were, well, we’d be happier. Right? Right.

So If what we’re doing isn’t working, we should stop it and do something else, right? That’s what our prejudices would say, and also what Bill McKibben [1] advocates (quite elegantly actually). What we (society) need is to get back to a state of community. We should stop exporting and importing and use what we produce within our means. A marrow-level subsistence [7]. This is all well and good; Romantic to the bone and very appealing.

But it’s bullshit. More specifically, if the solution is to localize, then it’s hopeless. We’re fucked.

Suppose a mid-twenties, Caucasian male (e.g. me) from 1912 was given the option to live in 2012. Assuming personal ties and antiquated skills were somehow not an issue (this is a thought experiment), it’s hard to imagine that anyone from 1912 would not jump at the opportunity to live in a place where infant mortality is less than 10 per 100,000 live births, life expectancy at birth has doubled, and the standard work week is a scant 40 hours [2]. Also, they get iPads (or Windows 8 tablets for you Balmer fans out there). What if you told said young man that he would, according to the most accurate statistics we have, probably be less happy. What do you think the reaction would be? Answer: “What the fuck do you mean? They have Apple 2s in the future!”

At this point, I will take a slight tangent to define my terms. Happiness is an emotion. Therefore, by definition, Happiness is temporal. It can be attained–even bought–easily, but it can be lost just as easily. Contentedness is a state of being; a mindset. It is difficult to attain, but once attained is unlikely to be lost. It’s that feeling of che sera sera; freedom from despair; confidence in one’s self, and comfort in one’s own skin.

So take our friend from 1912, transplant him into 2012 and let him walk around for a bit. He will be happy, but the people around him will not be content (more on this in the future). Then send him back to 1912. He now knows that this ‘progress’ will lead to mass uncontentedness. Will he try to prevent it? Possibly, but unlikely, and he will undoubtedly be overruled. Why? Because on the margin the next enhancement does make us better off. It’s the time-series equivalent of Simpson’s Paradox [8].

Here’s my point: even assuming it was possible to “go back” or otherwise align society around a more peaceful, contented, un-consumerist ideal, every incentive we face is going to push us to repeat the same process of innovating, adopting, and consuming on until we’re in the same place we’re in now. It’s inexorable and inevitable.

On the margin–i.e. at the time–every new technology will make us happier, so it will be adopted. Every new purchase will make us happy. And so will the next one. And we can muse about this facet or that and how minor tweaks would change the end result, but the fact that the alternative tweaks would have been adopted, means the affect on the end tragectory will be negligibly small or a subsequent technology with aforementioned alternative tweaks will emerge. Society, thy driver is you.

So if where we are is, by and large, unavoidable, what is the Archimedian Lever for society?
That will be the subject of the rest of the series, “On the margin; in the aggregate.”
Part two is on another paradox of aggregation: the precedence problem.


The tattooed economist sends his love.

[1] Deep Economy, Bill McKibben; http://www.billmckibben.com/deep-economy.html
[2] The Price of Everything, Russ Roberts; http://www.econtalk.org/
[3] Misc. Podcasts hosted by Russ Roberts; http://www.econtalk.org/
[4] StockCharts.com – Charting Tools; http://stockcharts.com/freecharts/historical/djia19001920.html
[5] Fight Club, Chuck Palahniuk
[6] Talk Deeply, Be Happy? NY Times; http://well.blogs.nytimes.com/2010/03/17/talk-deeply-be-happy/
[7] Ref. to Walden, Henry David Thoreau; Ch.2 Paragraph 16 http://thoreau.eserver.org/walden02.html
[8] Simpson’s Paradox; http://en.wikipedia.org/wiki/Simpson’s_paradox; http://upload.wikimedia.org/wikipedia/commons/c/c3/Public_Domain_Simpson%27s_Paradox.gif