How much did Plato know about behavioural economics and cognitive biases?

Pretty much everything. Nick Romeo in this essay explains how behavioral patterns and human biases have intrigued thinkers for a while. Just that they did not call it behavioral economics:

In his essay ‘On Being Modern-Minded’ (1950), Bertrand Russell describes a particularly seductive illusion about history and intellectual progress. Because every age tends to exaggerate its uniqueness and imagine itself as a culmination of progress, continuities with previous historical periods are easily overlooked: ‘new catchwords hide from us the thoughts and feelings of our ancestors, even when they differed little from our own.’

Behavioural economics is one of the major intellectual developments of the past 50 years. The work of the psychologists Daniel Kahneman and Amos Tversky in particular is justly celebrated for identifying and analysing many of the core biases in human cognition. Russell’s insight, in fact, bears a strong resemblance to what Kahneman calls the availability bias. Because the catchwords and achievements of contemporary culture are most readily called to mind – most available – they tend to dominate our assessments. The fact that Russell’s articulation of this idea is much less familiar than Kahneman’s is itself a confirmation of Russell’s point.

But the richest precedent for behavioural economics is in the works of ancient Greek philosophers. Almost 2,500 years before the current vogue for behavioural economics, Plato was identifying and seeking to understand the predictable irrationalities of the human mind. He did not verify them with the techniques of modern experimental psychology, but many of his insights are remarkably similar to the descriptions of the cognitive biases found by Kahneman and Tversky. Seminal papers in behavioural economics are highly cited everywhere from business and medical schools to the social sciences and the corporate world. But the earlier explorations of the same phenomenon by Greek philosophy are rarely appreciated. Noticing this continuity is both an interesting point of intellectual history and a potentially useful resource: Plato not only identified various specific weaknesses in human cognition, he also offered powerful proposals for how to overcome these biases and improve our reasoning and behaviour.

This I think also is the appeal of behavioral economics. All these biases etc have been there ever since humans came into being and started thinking and acting. These things were so obvious that no one cared much to write and document about them. Then came econs who said all this is nonsense, we are just rational nerds who think and act in a straight line. This occupied our minds for a while till again likes of Kahnemann and Tversky questioned the rational idea. Though even before Tversky and Kahnemann, likes of Adam Smith also wrote on human behavior but we hardly know him for his writing on behavior.

Fascinating stuff. History of thought is just so important..


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