Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

Thursday, March 11, 2010

Contextuality


Context is everything. A bold statement? Not really, if you think about it. In fact, it seems that the lion share of the problems that we face in our world are the result of improper awareness of context. Geopolitical issues are often the result of contextual misunderstandings, not only between differing cultures, but among the individual nations who believe that they ought to fight to secure the greatest access to resources possible. Failure to recognize context is at the heart of poor investments, poor performance in school, failed relationships, and jobs lost.

In this sense, the human sense, context is just another word for foresight and hindsight. We, as humans, seem to be really bad at considering the full context of the fragment of the world within which we live and operate. Some of this is probably due to the limitations of sensation and knowledge. Contemporary economists point to the lack of "perfect" information, and "perfect" rationality as limitations to classical economic theory. In a way, this lack of "perfection" is a lack of contextual understanding.

I think computers are helping to broaden our understanding of contextual issues. However, the internet also allows people to further insulate themselves from a full understanding of contextual issues by giving them a means of perpetuating instantiated beliefs through selective consumption of information. Will the future find us more rational, more informed, or more polarized?