Change, regardless of what, when, and how, involves four aspects of uncertainties. First, we are unable to compute the structure of the current existing environment, in which a product will be treated, or an action will be avoided or performed. Second, anticipating all the possibilities of a changing environment, in which the product or action will be bought or performed, is even less possible for us. Third, we are unable to compute with accuracy the outcomes of our decisions in the changing future environment. In fact, we cannot do that even in the current environment.

Specificity is introduced in our decision-making process when we could focus on the existing environment in connection with a particular problem, and focus on a particular change or a particular item and its future change of form or use. We focused on problems, such as legal problems, in specific areas. We picked the environmental change as a change, which is introduced into our lives, for example, by the creation and spread of the Internet, or a virus. In all these cases, because of our limited rationality, “approximation must replace exactness in reaching a decision.”[1] Approximation may be close to the alter-ego of “gut.” It may be a “feeling,” rather than a conclusion we could verify, of what the change might bring about.

The problem in using “gut” to evaluate and anticipate the impact of a unique, changed environment, is that we lack experience with respect to the particular change. Therefore, we would use a “gut” evaluation most of the time. Our reaction is then based on comparing the anticipated or new change to changes that have occurred in the past, and learning from them the optimal solution for to a present change-problem.

However, when the environmental changes are unique, we must resort to past experience by analogy. That makes the analogies to the new change more complex. Not only the relevant particulars of the problems might and usually do differ, but the environments in which they occur differ and therefore the problems differ as well. The past environment is not identical or sometimes is not even closely similar to the existing current one. After all, an accident while riding a horse is very different from an accident while driving a car, even though both are (i) accidents; (ii) involving driving, by using (iii) a support mechanism that substitutes for walking.

The issue of change requires us to resort to dual analogies: (i) analogize the particular problems, for example, an accident, to a similar accident or accidents; and (ii) analogize the particular environmental facts that are relevant to the problems—in this case a horse or a car. Thus, we can reach an approximation that helps us make decisions. Yet the difference in the use of a horse or a car may be determinative, relating to (i) cost, maintenance of the horse or the car, (ii) type of danger depending in part on the environment, (iii) who has the authority to authorize the use of these vehicles (iv) the law regulating the particular use of the transportation vehicles, and (v) the extent of possible injuries, depending on where the vehicles are used. Therefore, the comparison involves many comparisons and requires a manageable system of combining the items to reach decisions based on manageable.

Thus, even the definition of a possible problem remains uncertain. This definition depends on (i) our views of the problem and on (ii) the constraining environment, such as the law. In addition, the language we use is usually imprecise. We communicate not only by words but also by various signals because, in some communications, it may be more efficient than in others to help create a more efficient communication and require the transfer of less indirect or irrelevant information. For this reason, we communicate by classes, rather than by the units’ details within each class. That is why price signals are efficient.[2]

Yet, when attention is drawn only or mostly to price, for example, the attention is focused on select, actual, outcomes, rather than on potential outcomes: The price, rather than other features of a product we wish to purchase, draws our attention, and drives our decision on whether to buy this particular product. This narrow view of product evaluation may prove disappointing after short use.

So how do we make a useful (reasonable) decision that involves so many aspects and time constrains? We depend on rules, the products of judgments that evolved as a result of purchasing or offering lessons. We learned from similar past problems and solutions. When the rules are too detailed, we seek the elements that were less changeable–the principles. It is not surprising that guiding principles might differ in different communities and might change over time depending on experience. But if they are linked to the least changeable or unchangeable reasons for results, such as human nature, usually in an environment that rarely changes relevant facts, these principles become embedded in the rules. With time, these principles are hard to alter, even though the environment has changed. Yet, the best principles are those linked to us—the humans. These are principles that are less changeable or breakable.

However, the more we learn and change our views, the more we might change our guiding principles, unless they are derived from our own nature and social relationships which are more stable. Therefore, it is this aspect of the rise, change and stability of rules that we ought to learn.

The following are two examples that might demonstrate this suggestion.

1. Humans need protein. The human body contains protein. Therefore, there was an era in which some humans were cannibals: they killed others to eat their bodies. Since the potential victims might have been just as strong if not stronger, this source of protein was not only hard but also dangerous to get. Humans discovered without analysis of the reason or source that there are other sources of proteins—animals. In addition, they could hoard these sources, such as chicken and cows. In fact, they could enjoy watching these animals, humans created zoos.
2. In search of non-living sources of protein, some humans are vegetarians, seeking their protein in vegetables. They have developed effective and efficient means of killing from a distance, such as guns and bombs, and use them at times to kill other humans in self-defense. Thus, even though food may not be the objective of killing other humans, there are other objectives that may drive the desire of humans to kill other humans. The principle underlying these killings has become more sophisticated, including a desire for various sources of protein that other humans have developed, and sometimes fear of other peoples’ ambitions requiring preventive measures against them. Sometimes wars among humans lead to later wars by the vanquished. Germany’s loss of World War I and the high price it paid for that war seems to have had the effect of spawning World War II.

Change by humans leads to inventions as well. The car and plane offered faster transportation than the horse and buggy. Many medicines and medical supports enabled humans to live longer. Yet every change brought similar problems of the past.

Why? If change is so good, why does it raise so many problems? One answer is that change leads to the unknown and to possibilities that we did not anticipate nor experience before. The second answer is that the change may not produce the anticipated positive results and may pose serious difficulties. Yet, without trying to change, we do not experience what we lose and gain. Thus, we must try to adjust to the change even though we do not know the precise adjustments and its consequences.

So how do we deal with these issues? We could make the changes slowly, piecemeal. Use a step and examine the results, adjust the bad aspects of these results, when we can understand them and find the right adjustment. Or we can reject the adjustments, plunge into making the changes, watch carefully for negative signs and address them as we go along, rather than attempt to do so at the outset. The cost of this approach is continuing change and instability. Memorization, which in the past has taken first place in learning, may take backseat in the future. However, memorization may affect our research and search in the future and tempt us to ignore change altogether until we cannot escape it. We may justify ignoring a particular change. After all, we have had the experience before.

There is no place to start searching and finding an answer than today’s virus attack, which has infected humans all over the globe with no immediate escape. To be sure, we might view escape in future research and other plans but, for the present, we resolve the issue, not fully successfully, by closing our doors to each other. Yet, because we depend on each other, the closure is not complete. The imbalance, produced by door-closure, has produced losses. For some parties it has produced hunger. The closure has spawned political conflicts, and finger pointing behavior. In some communities, it is blaming each other. Unfortunately, in some countries, blaming has political motivations. But it can also take professional and personal motivations and may produce a culture of blaming and avoiding responsibility. To be sure, a heartening knowledge is the fact that there are people who made it their business to help others, while taking reasonable precautions to do so. And this observation leads to the following proposal.

A culture in which most of the population asks: “What does this do for ME” may produce a large population of poor people and a small group of very rich and educated people. A culture that requires every person to have the same rights and benefits regardless of his or her contribution (willing or coerced) will drain some of its creative people, who are not givers but may be takers and abusers. A culture, in which those who could give and enjoy giving and sharing with other, may be not only the richest, the least parasitic and demanding but also the leaders of all members.

In the last analysis, what is likely to create a wealthy and healthy society is a culture of giving to needy—when one can and receiving—when one needs to become self-sufficient and productive. This is an expected behavior as a matter of social rules, practice and habit. Need should not be shameful, except when it is false. Giving involves not only and perhaps not mostly money. It may involve use of land, actual help, trustworthiness, with no expectation of reciprocity, unless it is justified by the receivers’ good fortunes. Thus, needy receivers should be respected, Givers may receive recognition and respect, not only from the receivers but also from the entire population representing and maintaining a social culture.

Tamar Frankel
Professor of Law Emerita
Boston University School of Law

 

[1] Simon 1972 at 170, cited in Williamson Markets etc. at 23.

[2] Williamson 25, citing Hayek.