Tag: risk/benefit/cost assessment

Categories
33. Evolution from a Social Systems Perspective (Part 2)

Evolution from a Social Systems Perspective, Part 2

A living holon is any organism, any group of organisms, or any group of groups that work together with a common purpose. Human holons are a subset of living holons. They include individual people and organisations of all types from clubs, through businesses and nations, to the global community.

All living holons are motivated to acquire benefits or satisfiers and to avoid disbenefits or contra-satisfiers. However, most decisions have both benefits and disbenefits. That is, if implemented, they yield both satisfiers and contra-satisfiers. Rarely are they entirely beneficial. So, in deciding whether to act, living holons carry out a form of risk benefit cost analysis. The disbenefits are weighted, mitigated, and deducted from the benefits to yield a net benefit or disbenefit. That is, an overall satisfier or contra-satisfier. If there is an overall satisfier, then the living holon will act. If there is an overall contra-satisfier, it will not.

The benefits of an action normally apply to the actor, but the disbenefits can apply to any party. The more socially distant the latter from the actor, the lower the weighting given by the actor to the disbenefit. Also, in the case of people, the less empathic and the darker the traits of the actor, the lower the weighting given to disbenefits for others.

If an action that yields both a benefit and a disbenefit becomes established, and if they affect the ability of the holon or holons that experience them to survive and procreate, then they will become evolutionary drivers for that holon or those holons. If both are experienced by the actor, then both become evolutionary drivers for the actor. If they apply to different holons, then they become individual evolutionary drivers for those holons. These drivers will cause the benefit to be acquired ever more efficiently and the disbenefit to be avoided ever more effectively. Thus, the holon or holons will become ever more specialised.

Risk benefit cost analysis is not necessarily a conscious process and can be one that is programmed into a species by evolution. An example is the cognitive bias in human decision making identified by Kahneman and Tversky (Kahneman D., 2011). Cognitive biases are shortcuts to decision making carried out under the pressure of circumstances. They are often not entirely logical and are certainly not consciously considered, but they do have the advantage of being correct much of the time. We use them when there is no time to consciously review our decisions before events decide the outcome for us. It is more beneficial to take an action quickly and unconsciously, even if there is only a limited likelihood of success, than to engage in conscious reasoning and, during that process, experience failure.

The effect of the benefits and disbenefits of an activity on a single species can clearly be seen in one of nature’s most delightful sights, the murmuration, or synchronised flight, of a flock of starlings. A murmuration over Brighton Pier can be seen here https://www.youtube.com/watch?v=-eEobkfMC_4 .

The purpose of a murmuration is to attract starlings, who have dispersed during the day, into large groups for overnight roosting. If you watch carefully, you will see smaller groups joining larger ones and the latter steadily growing. Once a group is large enough, the birds will descend to roost together. This provides them with safety in numbers against predators. In other words, they cooperate to gain a mutual benefit or satisfier. There is no doubt that this instinctive behaviour has an evolutionary basis. Those that roost together are more likely to survive and propagate their genome than those that do not, and so, the genetic drivers for this behaviour propagate through the population over time.

There is, however, a downside. Flying together in close formation poses a risk of collision, injury, or death, and thus, a disbenefit or contra-satisfier. Mitigation of this disbenefit is carried out by spatial distancing. Using computer modelling the Italian Physicist, Professor Giorgio Parisi, found that the birds synchronise their flight by co-ordinating only with those adjacent to them (Parisi G., 2023). The skill involved is one of flying as closely to their neighbours as possible without colliding. This, in turn, is determined by their ability to respond to changes in proximity and direction before a collision occurs. There is no doubt that this skill also has an evolutionary basis. Those birds lacking the necessary genetic drivers will have collided and perished whilst those with them will have survived and procreated. Again, the necessary genetic drivers will have propagated through the population over time.

A colleague in LinkedIn, Fiona Clubb, describes the following event. “… about 25 years ago in Birmingham, England. I was competing in a Western Equestrian national show and was in a very small collecting ring with around 30 other competitors. There was very little room but the riders were all practicing their art, some going sideways, some at a flat out gallop, some just standing, and others spinning on the spot at high speed. It was complete chaos, yet nobody came close to colliding. They were all in control, and totally aware of space as it opened up for them to make their move. I have never seen anything like it. It was like a chaotic murmuration. The only protocol in place to coordinate the process was the riders’ mental skill and their ability to adapt…”. (Clubb F., 2024)

In this example, the riders were acquiring the mutual benefit of practicing their skills. However, as a part of this they also had to avoid the contra-satisfier of collisions. Again, this disbenefit was avoided by spatial distancing.

On the streets of a busy city, dense crowds of people walk in many different directions but, unless they are using smartphones, collisions are rare. In the same way as the starlings and the horses and their riders, people show a remarkable ability to avoid them. Indeed, in the branch of psychology known as proxemics, if one person enters another’s defensible space this is regarded as a threat. (Hall, E.T. 1966). The ability to avoid one another’s defensible space is almost certainly an evolved trait. It may also be an evolved trait in horses which are a herd species. So, it is likely that, in Birmingham, the horses were contributing as much to the avoidance of collisions as their riders.

Spatial separation can also be observed in the niches occupied by different species. For example, the insect species on a tree are separated according to the parts of the tree. Some occupy the foliage, some the branches, and others the trunk. All benefit from being a part of the larger ecosystem but maintain spatial separation to avoid direct conflict.

The same is true of human sub-cultures. The members of a sub-culture will gather together to avoid conflict with others but will remain in the same locale as the main culture and reap its benefits for so long as it tolerates them.

In human affairs, functional difference can, however, replace spatial distance. For example, fast food outlets will tend to congregate in the same location, and this acts as a mutual satisfier by attracting customers to that location. However, we do not see two fish and chip shops next door to one another. This is because the same function in the same location would create competition that is likely to become negative and lead to conflict. This, in turn, would ultimately lead to the failure of at least one competitor. The weaker competitor would be taken over or driven out by the more successful one. So, the outlets differ in function: fish and chips, Indian, Chinese, burger bars, coffee shops, and so on. There is some competition in terms of value for money, but no immediate competition in terms of the service provided. Each outlet shares the mutual benefit of cooperation and avoids the potential disbenefit of conflict by functional distancing.

Competition and takeovers are common in the business world when two organisations have a similar function. Thus, there is a tendency for functional distance to develop between businesses in the same market. This minimises conflict but can lead to the formation of monopolies. However, because monopolies can discourage innovation and abuse their powers, most governments legislate and regulate to prevent them. Departments or components within an organisation are, however, often monopolies. This is because there is no market choice, and the cost of duplication would outweigh the benefits of competition. It is, however, possible to introduce competition by splitting departments geographically or by outsourcing an activity to more than one contractor.

In summary, the decisions of living holons, human or otherwise, involve both satisfiers and contra-satisfiers, and so, an often innate form of risk benefit cost analysis is carried out when deciding whether to act. If an activity becomes established, then its benefits and disbenefits can act as evolutionary drivers for the holons that experience them. This process can be seen in both humans and other animals. It can also be seen in individuals and groups. Finally, it can be seen in both biological and cultural evolution. As well as learning to take decisions using these analyses, people also take them intuitively, and so, our genetic inheritance plays a part. Thus, human behaviour, although more complex than that of other species, is not as different or as divorced from nature as we sometimes like to believe. The principles of evolution still underpin our behaviour.

References

Clubb, F. (2024). Jobs for Horses, LinkedIn. https://uk.linkedin.com/in/fiona-clubb-47074095

Hall, Edward T. (1966). “The Hidden Dimension”. Anchor Books. ISBN 978-0-385-08476-5.

Kahneman, D. (2011). “Thinking, Fast and Slow”. New York: Farrar, Straus and Giroux. ISBN 978-0-374-27563-1.

Parisi, G. (2023). “In a Flight of Starlings”. UK: Penguin Random House. Allen Lane.

Categories
08. The Evaluation of Resources and Risk/Benefit/Cost Analysis

The Evaluation of Resources and Risk/Benefit/Cost Assessment

The Evaluation of Resources

Resources are those things that we employ to gain satisfiers for our needs or to avoid contra-satisfiers. For example, time, physical and mental effort, money, etc. The effort involved consumes resources that we control, whether they belong to us or to others.

It is important to distinguish between resources and satisfiers. For example, although we are used to thinking of air as a resource, this is incorrect because no-one experiences, owns, or controls it. However, without it we would die. It is therefore a satisfier of an important existence need.

Like satisfiers and contra-satisfiers, resources are evaluated emotionally. Their value derives from the value of the changes to satisfiers and contra-satisfiers that their use causes. The latter, in turn, derive from the changes in our emotional state that they achieve.  However, it can be extremely difficult to predict what resources will be needed and whether the desired effect will be achieved. For example, we cannot predict how long a hunting expedition will take or whether it will be successful. To add a further level of complexity, several resources may be needed to acquire a satisfier or avoid a contra-satisfier.

It may be that there is an objective and logical method of deriving the value of resources from the value of changes to satisfiers and contra-satisfiers. However, this would be a very complex process and not something that we could do in our heads, especially when under pressure to make a decision. In practice, therefore, resources are valued as follows:

  1. Via socialisation. For example, if a group of people find that dried cow dung burns, will provide warmth at night, and will cook food, then they will attach an emotional value to it. When raising children, they will educate them in that value. However, a modern person may not attach the same value, especially if he steps in it.
  2. From experience. For example, if spending an hour carefully choosing the ingredients for a meal results in praise for one’s cooking, then the emotional value attached to that hour (a resource) derives from the emotional value of achieving that praise (a satisfier). Over time, as we make more such assessments, we will allocate an average emotional value to an hour of our time.

Inevitably, each person places a different emotional value on each resource, and these values can alter with changing circumstances and experience.

Risk/Benefit/Cost Assessment

Rarely do we control sufficient resources to fully satisfy all our needs and avoid all our contra-needs. So, we try to apply those resources that we do control to best effect. The decision on how best to apply them uses a risk/benefit/cost assessment.

All changes to a satisfier or contra-satisfier which may be caused by an act are assessed for their overall effect on our emotional state. For each satisfier or contra-satisfier this depends on four things: the priority we give to the relevant need or contra-need; the extent to which it is already impacted upon by other satisfiers and contra-satisfiers; the anticipated change to the relevant satisfier or contra-satisfier; and the likelihood that our behaviour will make that change.

The resources that we employ also have an emotional value and their use reduces our overall emotional state. When deciding to act, we take into account both our likely use of resources and the likely changes they will make to our satisfiers and contra-satisfiers. If the net change to our emotional state is positive, then this is a benefit, and, given a choice, we would normally choose the option with the highest benefit. However, if the net change is negative, this is a dis-benefit and we would not normally adopt that option.

The Value of a Gain or Loss

It is notable that people are more averse to losing a satisfier than failing to gain it. This is known as a cognitive bias and sometimes, incorrectly, regarded as irrational. The main reason for this bias is associated with the effort involved in creating and altering our schemata. Much mental effort is put into building schemata, and mental effort is, of course, a finite resource. For example, if we own a car then we also need to incorporate this fact into our schemata for shopping, travelling to work, holidays, and so on. We also need driving skills, knowledge of road traffic law, etc.

The assessment involved is relatively simple and can, therefore, be explained by mathematical analogy. If we gain a car then we gain the net benefit of a car, (a), less the effort involved in constructing the schemata that go with it, (b). The value of gaining a car is therefore (a – b). However, if we lose a car we lose the net benefit of the car, (a), and added to this is the effort involved in revising our schemata, (c). The loss is therefore (a + c) which is, of course, greater than the gain (a – b).

Categories
03. How Needs and Contra-Needs Motivate Us

How Needs & Contra-Needs Motivate Us.

Variational Principles

Variational principles exist widely in the physical world. They state that a physical object, system, or event will behave in a way which minimises or, in some cases, maximises some physical quantity. The most famous of these is Fermat’s Least Time Principle which states that the path taken between two points by a ray of light is the path which takes least time.

Similar principles apply to human decision-making and behaviour. We will first attempt to satisfy the need which has greatest value to us, i.e., the need which is most pressing. Furthermore, we will attempt to satisfy it in a way which demands least use of personal resources or the resources of those close to us.

First Variational Principle – Pressing Needs

Behaviour is physical action or communication to satisfy our needs. It involves the application of resources available to us. Behaviour can be simple, i.e., directed towards a single need, or complex and directed towards several needs. In Maslow’s view, most behaviour is multi-motivated, i.e., determined by several needs rather than just one. For example, eating may satisfy one’s hunger, need for comfort, and need to socialise.

We tend to address our most pressing needs first, but priorities differ according to the individual and circumstances. The behaviours that we adopt contribute significantly to the perception of our personality, therefore.

Second Variational Principle – The Efficient Use of Resources

People aim to satisfy each personal need as efficiently as possible, i.e., in a way which yields the maximum benefit for the least expenditure of personal resources. For example, if a person walks across a park to a gate in the opposite corner he or she will do so in a straight line unless other needs are satisfied by not doing so. In this way our resources can be used to provide greatest satisfaction across all our needs.

The Role of Emotion in Decision-making

Many higher animals experience emotion and, in the human being, evolution has built on that foundation. Most psychologists now recognise that emotions are an integral part of the human reasoning and decision-making process. They are not, as so often portrayed, the enemy of reason. We may be able to make a logically or mathematically based decision in very simple circumstances, such as whether to buy 4 apples for a pound at one stall or five identical apples for a pound at another. However, the circumstances surrounding most decisions are far too complex for this. In such circumstances, it is emotions that motivate our behaviour. They are used to “tot up” the effects of satisfiers and contra-satisfiers, i.e., those things which cause our needs to be satisfied or which cause harms we wish to avoid.

We experience several basic emotions, and they fall into two classes. Those associated with satisfiers are regarded as positive and those associated with contra-satisfiers are regarded as negative. Our decisions aim to improve our overall emotional state by increasing the former and reducing the latter. Note that it is satisfiers and contra-satisfiers, i.e., external causes, that are evaluated rather than our internal needs and contra-needs. So, for example, the presence of a contra-satisfier such as a disease, and the absence of a satisfier such as food will both contribute to a negative emotional state.

Our overall emotional state depends on whether the status of each satisfier or contra-satisfier is: absent; latent; precarious; or entrenched. Here, “latent” means capable of manifesting, for example when a satisfier is promised, or a contra-satisfier threatened. “Precarious” means present but insecure. “Entrenched” means present, solidly established, and unchangeable.

Emotions are experienced on a scale from mild or non-existent to strong or overwhelming, depending on the priority of the need or contra-need and the status of the satisfier or contra-satisfier. Most of the time our emotions are low key, for example a mild feeling of discontent, and we are capable of consciously verifying our decisions and making rational choices. These lower key emotions are used to “tot up” the predicted effects of our decisions before they are implemented. For example, if we decide to behave in an anti-social manner, then we are likely to predict social censure, which is of course a contra-satisfier. This will contribute to feelings of anxiety which may cause us to alter our decision.

However, when emotions are very strong or overwhelming, we experience stress. Hormones are released which prepare our bodies for swift action in the face of an immediate risk or opportunity and we respond almost entirely unconsciously. This is, of course, an inherited survival mechanism which, on average, enables us to survive and prosper when there is no time for the conscious verification of our decisions. It does, however, carry with it a strong risk of error.

When making more considered decisions about our behaviour we carry out a form of risk/benefit/cost assessment. In this context, “risk” means the likelihood that our behaviour will result in the anticipated benefits and/or dis-benefits. “Cost” is the value that we place on the resources used.

The “benefits” of any behaviour are reductions in negative emotions, such as fear and grief, and increases in positive emotions, such as happiness. These benefits are due to increases in the status of satisfiers and decreases in the status of contra-satisfiers. For example, a benefit results when access to food increases or when a risk of disease decreases.

Dis-benefits, on the other hand, are increases in negative emotions and decreases in positive emotions. They are due to decreases in the status of a satisfier or increases in the status of a contra-satisfier.

Benefits and dis-benefits can of course, cancel one another out and, depending on their relative magnitude, may yield a nett benefit, no overall benefit/dis-benefit, or a nett dis-benefit. The magnitude of benefits and dis-benefits are, in turn, determined by several factors related to needs and contra-needs which will be described in a future article.