Hans Gottinger, Essays on Decision, Information, Computation and Technology

FOREWORD
HANS W. GOTTINGER
FOREWORD
Selected writings of a very prolific author over a long-time period typically open a window both on the
evolution of his thinking and on the changing focusses and fads of the scientific community. <strong>Gottinger</strong>s’s
<strong>Essays</strong> on Decision, Information, Computation & Technology, which cover roughly the period 1970-2000,
are no exception.
The essays, some of which are in German, are hard to subsume. They span across economics, mathematics,
operations research, expert systems, and then some. They include provocative advances, more standard
efforts, and uncontroversial applications. At their best, they delineate new venues of research that could
significantly impact the way we are doing economics. It has been widely argued, rightfully so in my
opinion, that the imperialistic spread of neo-classical thinking has stuck much of the economic profession
in an increasingly noxious Newtonian vision of the economy together with a very narrow conception of
rational decision-making. As usual with theoretical approaches that struggle to cope with the reality, most
improvements efforts at improvement are purely incremental and do not go beyond patching up the main
deficiencies by twisting standard relationships, adding new one, introducing more and more epicycles while
rejecting any true change in paradigm. Not so <strong>Gottinger</strong>, who did not hesitate to enter terra incognita and
suggest radically new ways of addressing fundamental economic questions.
The first and by far larger section of the book focusses on decision-theoretic problems. Some early works,
published largely in the period 1970-1975, centre about conditions under which preferences can be represented
by a utility function with agreeable properties. The issue was acute at the time but has largely been exhausted
nowadays and arguably stalled rather than promoted our mastering of the very large and most important
class of situations where standard utility functions do not exist. Still, it remains at the very core of neoclassical
economics. A standalone contribution reviews the foundational work in measurement theory that
was carried out at the time by such authors as Krantz, Luce, Pfanzagl, Suppes, and Tversky. The logical
link between utility, decision-making, and measurement is immediate, utility is nothing but a measure of
preferences, and decision-making typically requires measurement. Nonetheless, the theory of measurement
has been largely, and unfortunately, overlooked by the economic profession. To my knowledge, <strong>Gottinger</strong>’s
paper is one of the very few attempts to remedy this and remind economists that much work relevant for
the very core of their discourse is being done outside of their narrow disciplinary circles.
Several later papers in the <strong>Essays</strong>’ first section are disruptive in their attempt to enrich and transcend the
standard neo-classical framework by introducing concepts and methods from other disciplines, predominantly
information theory, statistical inference, computing, and abstract automata theory. Thus, <strong>Gottinger</strong> suggested
in a 1990 paper using the maximum entropy principle to tackle decision-making under uncertainty. This
was brave – entropy is not easy to interpret, understand or visualize in a socio-economic context. The use of
the concept in economics remains marginal up to now but is the subject of active research in the innovative
fringe and increasingly used in such field as game theory, finance, robust optimization, and organization
theory. Other lines of research suggested in several articles hint to the nowadays very active and promising
efforts in complexity economics and agent-based economics. Other papers combine information theory as
the mathematics of communication and storage of information with more standard economic issues. Here
again, one recognizes some early precursors of complexity and agent-based economics, but also of boundedrationality
models and computational games, among others. Inexplicably, and unfortunately, the <strong>Essays</strong> do
not include the nice paper on Structure and Complexity in Socio-Economic Systems that <strong>Gottinger</strong> jointly
published with the late Peter Albin in Mathematical Social Sciences 1983.
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