There is symmetry in economic and quantum uncertainty

The world of quantum mechanics is hardly the same world we inhabit on a daily basis. Reduced to its fundamentals, matter seems much less calculating than we expect.

Experiments in particle physics that began in the early 1900s with the likes of Schrödinger and Heisenberg depict a conception of reality in which events are far more probabilistic than determined. Unlike a ball hitting a bat, when an electron repels against another electron we cannot know with absolute confidence where it will go next. Its final trajectory is the collapse of an infinite number of probabilities, all impossible to predict in sum.

But not all modern physicists can commit to the quantum world. In a recent interview with Science News, Nobel laureate Steven Weinberg admitted that, though a lifelong believer of the quantum agenda, he now sympathizes with critics of the theory.

Speaking from his gut, he confessed that it is “so ugly to imagine that we have no knowledge of anything out there — we can only say what happens when we make a measurement.” Weinberg’s simple wish is that we can look to the past, and indeed to the future, with some amount of certainty.

In this restlessness with uncertainty, theoretical physics is accompanied by a field of study across the academic spectrum: economics.

When formal economic thought expanded during the Enlightenment, it did so upon specific assumptions about human behavior. While Isaac Newton reduced the motion of galaxies into six-variable equations, John Locke and Thomas Hobbes were reducing the behavior of markets into basic exchanges of supply and demand.

Importantly, economic actors in these exchanges were expected to perform rationally so as to maximize their individual profit or utility. This concept of decision making, commonly referred to as the neoclassical model, works off a caricature of man that has wittily been dubbed homo economicus — someone who always makes the best decisions for his or her welfare — in the late nineteenth century by critics of political economist John Stuart Mill.

It goes without saying that homo economicus does not exist. You and I often act completely irrationally — when deciding how to study, what friendships to invest time in, what to purchase at UniMini, etc.

Yet it has taken some time for economists to factor these quirks into their equations. Only the last half century has acknowledged, through the growing field of behavioral economics, more nuanced psychological accounts of decision making — personal heuristics, situational biases and paradoxes in perception are all now on the blackboard.

With this acknowledgement, economics is slowly returning to the highly unpredictable unit of study that lies at the center of us all — essentially homo sapien.

In the same way that we cannot predict the trajectory of electrons, neither can we calculate absolutely how a single person will respond to various market incentives. With the same growing pains experienced by physicists a century ago, uncertainty has reared its incalculable head in the economic market.

This shared characteristic is only accented by the analytic respect given to each field. If physics is the most mathematically grounded discipline of the hard sciences, then economics must be considered the same for the social sciences (indeed, it is the only field that has awarded a Nobel Prize among its humanities kin, and likely for this reason).

Yet, as we have now come to realize, this shared respect may come with some embarrassing naivety.

Nevertheless, with these two disciplines serving as bookends, one can now imagine a spectrum of uncertainty stretching from theoretical physics to economics, with the source of uncertainty gradually shifting from the world outside the unit of study (electrons, protons, etc.) to the world inside it (the mind of a person).

In the middle of this spectrum is biochemistry, for instance; it is far enough away from quantum wave functions to make accurate molecular predictions and far enough away from consciousness to avoid arbitrary personal preference.

Taking a step back from this spectrum, while uncertainty for both the physicist and economist (and everyone in-between) may be troubling at an academic level or even viscerally for those like Weinberg, in a cosmic sense uncertainty is a beautiful thing.

Just as we cherish the quirky spontaneity of our friends, acknowledging the unpredictable behavior of matter at a fundamental level is similarly exciting.

There is a certain degree of enchantment that exists between the present and the future, and both electrons and the people right next to us grant us this imaginative beauty. So while uncertainty may damage the elegance of our equations, it will certainly not damage the elegance of our relationship to the external world as we break from our daily march and dance along with it.