Constraints and Objectives: Complementary Aspects Of Choice
Constraints and objectives are the two complementary aspects of choice rationalization.
This is a post I have been meaning to write for a while, because it involves important recurring principles, and highlights many problems with conventional economic thinking.
Constraints and objectives are two different ways of mathematically and philosophically framing the actions which entities perform and the reasons they choose those actions.
A Definition of Choice
I have been developing a particular definition of “choice” as well as many related terms. If you read more of this publication you can see how some of these definitions have been developed. Right now, this my best definition of choice:
Choice is the performance of resource programs in the context of an information system.
The Three Fundamental Types of Resources
Information systems are imposed on physical systems. Meanwhile, virtual entities attempt to manage physical, virtual, and informational resources coherently in unison, in order to pursue their goals. “Physical”, “Virtual”, and “Informational” are adjectives I am using to label what I am identifying as the three fundamental types of resources.
The distinction between physical, virtual, and informational things is not about objects themselves, instead, this distinction reflects different ways in which that object is relevant or valuable to a speaker. If we want to determine which type of resource is being discussed, we don’t look at the object itself, but the entities discussing the object, and the language they use. Especially, we want to identify any implicit relationships assumed by the language used. Most things with which humans interact, can be treated as each of these three types of resources at different times. A single object can be physical, virtual, or informational. A stop sign, for example, is physical based on the materials which compose it, it is virtual because it has a defined legal significance in society, and it is informational because it uses common recurring shapes and symbols to encode meaning.
Aristotle’s metaphysics focused on four causes: Material, Formal, Efficient, and Final. My attempt to distinguish physical, virtual, and informational resources is based on a similar idea, but I want to highlight the relationships involved when we talk about and interact with objects and resources. There are relationships between the speaker and the object, between the speaker and the listener, and between the object and society. “Physical”, “Virtual”, and “Informational” describe different aspects of these relationships involved in object reference.
Philosophy is a challenging subject, and while I recognize its merit, I have not studied it enough to claim I understand its key ideas and can apply the words and language of philosophy accurately. What I know of philosophy comes from a 2 different introductory courses I have taken and what I have read from random sources(mostly on theory of mind). In one philosophy course I took, we discussed Aristotle’s four causes, and the idea resonated with me. The four causes explore different aspects of the nature of objects.
On the other hand, Aristotle died 2,339 years ago. His ideas, such as his descriptions of a “prime mover” don’t reflect a great deal of experience and knowledge humanity has gained since that time. Much has been learned about the history and origins of our natural world since Aristotle contemplated and commented on that subject. But he is to be commended for expressing ideas that can still be influential and valuable for thinkers today. When we think philosophically, we separate our biases and assumptions from our observations and experience, and this helps us arrive at ideas and concepts that are more universal.
Three Alternative Dimensions
Compared to Aristotle’s four causes, the three types of resources I identify are not specifically about the why or how of objects. Instead these 3 resource types reflect the different nature of relationships involved in choice. Resources are defined by their relevance in choices, and choices are about resolving relationships, thus, a classification of resource types necessarily must explore relationships. As a mathematical analogy, I see merit in thinking of these resource/relationship types as dimensions. There is a physical dimension, a virtual dimension, and an informational dimension. Like the “Mirror Dimension” depicted in Marvel’s recent movie Dr. Strange, virtual and informational dimensions mimic and influence the physical world even though their rules are different(and vice versa).
How Constraints and Objectives are Related to Choice
One example of choice is when distinct living biological organisms, often called “individuals”, use cognition to determine the actions they perform. “Human” choices often place particular emphasis on social considerations.
Constraints and objectives play an important role human interactions, relationships, and our choices. These concepts are key in understanding the motivations and rationalizations of choices. And yet, distinguishing between constraints and objectives is treated as an afterthought, only used in mathematical modeling, not for its great insight for developing sound economic principles. I shake my head as I see economic thinkers frequently confuse constraints and objectives, and fail to distinguish between these two motivators.
Perhaps the most glaring example of such confusion is Milton Friedman’s infamous essay “The Social Responsibility of Business is to Increase It’s Profits”
A constraint, such as business profitability, must be met at least at a minimum level. Failing to meet a constraint involves some kind of unacceptable consequence. But at the same time, there may be no reason to pursue a constraint beyond the minimum level. Pursuing constraints beyond what is needed can be wasteful or inhibit the fulfillment of other goals when taken to excess.
An objective is a complex synthetic goal. To pursue these goals, we often identify different tasks required, and take various measurement, called metrics, to assess our fulfillment of the goal. It’s not always easy to define these metrics or identify these tasks. Tasks and measurements help assess performance, but we must not confuse these tasks identified and metrics defined for the goal itself.
When mathematical optimization models are created, such as linear programming, an objective function is defined. Additionally, constraints are defined and represented mathematically.
Once constraints and objectives are defined, an algorithm is used to solve for the optimal solution. This assumes our mathematical model accurately represents the social objective which motivated the creation of the model in the first place. (It also assumes that the math problem is actually solvable, which is frequently not the case).
Social objectives are very abstract. They are frequently too abstract for true mathematical representation. “World Peace”, “Social Justice”, or “Individual Freedom”, cannot be captured in a single equation or expression. Yet we can sometimes find equations and expressions that align with these objectives if their scope is limited to a context where the mathematical representation is accurate and helpful.
Problematically, we often treat mathematics and empiricism as the goals themselves, and our social policies as subservient to these disciplines. We must transform our discussions by restoring our social vision to the central focus, with mathematics and empiricism as supplemental tools.
The foundational idea of modern mainstream economics: utility maximization, does not adaquately incorporate the two complementary aspects of choice rationalization: Constraints and Objectives.