G.L.S. Shackle (eBook)

Peter Earl is a former co-editor of the Journal of Economic Psychology and is Associate Professor of Economics at the University of Queensland, Australia. His many books include Economics as an Art of Thought: Essays in Memory of G.L.S. Shackle (2000) (editor, with Stephen Frowen).Bruce Littleboy is Senior Lecturer in Economics at the University of Queensland, Australia. He wrote On Interpreting Keynes (1990) and was awarded a Shackle Studentship at St Edmund's College Cambridge in 2011.

Cover 1
Title 4
Copyright 5
Contents 6
List of Figures 9
List of Tables 10
Preface and Acknowledgements 11
1 Introduction 15
2 Life and Vision 21
2.1 Introduction 21
2.2 The discipline’s most radical economist 24
2.3 A man of quiet ambition 27
2.4 Life, disposition and vision 28
2.5 On method and style 31
2.6 Conclusion 39
Appendix: George Shackle’s family history 41
3 Shackle’s Economics 44
3.1 Shackle’s kaleidics 44
3.2 Shackle’s policy vision 46
3.3 Kaleidic macroeconomic theory 50
3.4 Shackle, institutionalism and Austrian economics 55
3.5 Shackle’s economics today: complexity and emergence 60
4 Possibility versus Probability: The Rhetoric of Choice 65
4.1 Introduction 65
4.2 Possibility versus probability 68
4.3 The rival positions 71
4.4 Going too far? 77
4.5 Psychology and probability 80
4.6 Hypothetical experiments: picking a ball from a bag 85
4.7 Expertise 88
4.8 Bluffing and game theory 90
4.9 Deep uncertainty: we simply do not know 92
4.10 Concluding reflections 94
5 Potential Surprise and Choice 98
5.1 A decade in development 98
5.2 Prospective returns and potential surprise 101
5.3 From conjectures to choices 104
5.4 Standardized focus outcomes 112
5.5 Coming out against probabilistic models of choice under uncertainty 117
6 Critical Perspectives on Shackle’s Theory 123
6.1 Shackle and his critics 123
6.2 The subjectivist nature of the theory 124
6.3 Objections to the idea of potential surprise as an alternative to probability 127
6.4 Objections to the idea of focusing on best and worst outcomes 132
6.5 The alleged redundancy of the gambler indifference map 135
6.6 The debatable form of the F -surface 140
6.7 The evidence 146
6.8 Conclusion 150
7 Making Sense of Diversification 152
7.1 An unsatisfactory prediction 152
7.2 Shackle’s view of multi-asset diversification 154
7.3 Systemic versus non-systemic risks 159
7.4 Diversification, kaleidics and the firm 163
8 Shackle and Behavioural Economics 168
8.1 Shackle as a behavioural economist 168
8.2 Bounded (un)knowledge versus bounded rationality 172
8.3 Opportunities for integrating the analyses of Shackle and Simon 177
8.4 Shackle’s analysis versus Prospect Theory 181
8.5 Base-rate probabilities for novel/singular situations 191
9 Lessons for Economists, Entrepreneurs and Business Schools 194
9.1 Introduction 194
9.2 Non-additive ways of choosing 195
9.3 Kaleidic versus systematic aspects of choice 198
9.4 Avoiding unpleasant surprises and opportunity losses 200
9.5 Contractual incompleteness and economic organization 204
9.6 Marketing and consumer well-being 206
9.7 Entrepreneurship 209
10 The Passage of Time: Shackle, Shell and Scenarios 212
10.1 Background to the connection between Shackle and Shell 212
10.2 The British Association for the Advancement of Science meeting in York, 1981 221
10.3 To cope with time 224
10.4 Interest in Shell’s scenarios approach by Shackle enthusiasts 226
10.5 Concluding remarks 228
11 Coda 229
Notes 232
References 239
Index of Names 253
Index of Subjects 256