Jonathan Haidt is now a popular speaker, having written two very good books (The Happiness Hypothesis and The Righteous Mind), but his books are really derivative of Michael Gazzaniga, the guy who really pioneered the right/left brain differences by looking at patients who had their corpus collosum. Gazzaniga's book Who's in Charge is filled with interesting tidbits, and Haidt's especially interested in how our narrating left hemisphere confabulates reasons for beliefs it often doesn't understand, and doesn't know its confabulating: we lie to ourselves all the time because often we don't know it (the most unethical person I have ever known once told me that he never lied, which I knew sounded like trouble, and it was; he was a psychopath). It's the kind of biologically-based psychology that makes one happy to live now because as smart as Aristotle or Schopenhauer were they just couldn't have known this, and so at least in some things I can see more than they could, and I'm grateful for that.
For example, he notes that culture affects genes, and notes that many have noted East Asian culture is more oriented towards harmony, Western towards individual agency. When shown a sequence of boxes with lines in them, fMRI sudies show that East Asians looked more at relationships between geometric figures, relative judgments, while Westerners looked more at the absolute sizes from one picture to the next. They also found that East Asians looked more at the scene of a picture, while Americans looked more at the main items. This suggests East Asians have an even stronger relative utility preference than Americans, and this could have asset pricing implications in Asia vs. the West.
He also noted studies have found American subjects process social emotions in a particular area of the brain. That is, envy when seeing the rich, or pride in seeing a successful American athlete, or pity when seeing a pathetic looking person, all lit up the medial prefrontal cortex. These are all related to how we empathize, sympathize, and compare to people. Disgust, meanwhile, lights up different parts of the brain because it is an emotion not related to sociability. This is why he thinks when people find enemy groups disgusting it's the first step to dehumanizing them, which can lead to all sorts of unempathetic behavior common in human history (outgroups were often treated as animals, historically). More interestingly, greed isn't something that pertains to a specific part of the brain, but envy is. Envy is a Human Universal, as Donald Brown notes, found in all cultures, where greed is not.
For example, he notes that culture affects genes, and notes that many have noted East Asian culture is more oriented towards harmony, Western towards individual agency. When shown a sequence of boxes with lines in them, fMRI sudies show that East Asians looked more at relationships between geometric figures, relative judgments, while Westerners looked more at the absolute sizes from one picture to the next. They also found that East Asians looked more at the scene of a picture, while Americans looked more at the main items. This suggests East Asians have an even stronger relative utility preference than Americans, and this could have asset pricing implications in Asia vs. the West.
He also noted studies have found American subjects process social emotions in a particular area of the brain. That is, envy when seeing the rich, or pride in seeing a successful American athlete, or pity when seeing a pathetic looking person, all lit up the medial prefrontal cortex. These are all related to how we empathize, sympathize, and compare to people. Disgust, meanwhile, lights up different parts of the brain because it is an emotion not related to sociability. This is why he thinks when people find enemy groups disgusting it's the first step to dehumanizing them, which can lead to all sorts of unempathetic behavior common in human history (outgroups were often treated as animals, historically). More interestingly, greed isn't something that pertains to a specific part of the brain, but envy is. Envy is a Human Universal, as Donald Brown notes, found in all cultures, where greed is not.
6 comments:
I’m not surprised that greed doesn’t seem to have a particular locus in the brain as I think it is a vague and ill-defined quality even though we act as if it is something very specific and identifiable.
It’s usually pretty obvious when someone is being envious, fearful or proud but behavior that is labeled “greedy” (usually disparagingly and by others) can often be better attributed to a number of different causes. I can see how the hoarding/stockpiling/penny pinching type behavior that we used to see in old people who lived through the Depression might be perceived as greedy by more affluent and entitled people today. In other words I think greed is more of an external, cultural value judgment than an internal social emotion.
Hah! Einhorn is all over Apple today about it's cash hoard:
http://finance.yahoo.com/news/apple-depression-mentality-grandma-einhorn-145137404.html
"Einhorn said Apple is acting like "someone who's gone through traumas ... they sometimes feel they can never have cash.""
...or maybe they're just anticipating trauma.
I rather enjoyed your book (bought through Amazon after Xmas), but I do have one comment on the Falkenstein conjecture. I would note your chart showing the lowest returns in the most volatile stocks has another explanation- one that might be better suited to explain that large anomaly.
The most volatile stocks are also the most targeted by the pump and dump crowd, which as we all know regularly operates in the markets, especially in the thinner markets of smaller stocks. Now, the lower returns of high volatile stocks would show that say a planted article on the front of yahoo finance (PGRX this week comes straight to mind), shoots the volume and price right up, and then is sold right back down to a small gain.
Pump and dump, with inside info, or just using market maker manipulation, would especially account for a lot of the low returns in that upper fifth.
Envy of successful criminals...
You betcha. When someone trumpets their honesty it's time to run for the hills.
There once was a sanctimonious fraudster who said 'probity'...
I'm pressed to think that even though there are differences in how we view things versus how East Asians view things, if we spent enough time in their respective culture, our brains would adapt to their paradigm, or at least have the ability to adapt to it.
And yet reading Schopenhauer is just so much more pleasurable, that it might leave a more lasting impact!
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