2004 : WHAT'S YOUR LAW?

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Psychologist; Director of the Center for Adaptive Behavior and Cognition at the Max Planck Institute for Human Development in Berlin; Author, Gut Feelings
Gigerenzer's Law of Indispensable Ignorance

The world cannot function without partially ignorant people.

The ideal of omniscience fuels the many disciplines and theories that envision godlike humans. Much of cognitive science, and Homo economics as well, assume the superiority of a mind with complete, veridical representations of the outside world that remain stable and available throughout a lifetime. The Law of Indispensable Ignorance, in contrast, says that complete information is neither realistic nor generally desirable. What is desirable are partially (not totally) ignorant people.

Justice is blindfolded; jurors are not supposed to know the criminal record of the defendant; trial consultants hunt for "virgin minds" rather than academics as jurors. Academics in turn review papers anonymously under the veil of ignorance about the authors; trust in experiments demands double-blind procedures; economic fairness encourages sealed bids. The efficient market hypothesis implies that knowledge of future stock prices is impossible, and the Greek skeptics taught their students that they knew nothing.

When watching a pre-recorded football game, we do not want to know the result in advance; knowledge would destroy suspense. The estimated 5 to 10% of children and their fathers who falsely believe that they are related might not lead a happier life by becoming less ignorant; knowledge can destroy families. And few of us would want to know the day we will die; knowledge can destroy hope. 

Zero-intelligence traders who submitted random bids and offers in double auctions were as good as experts. Pedestrians who chose stocks by mere name recognition outperformed market experts and the Fidelity Growth Fund--and even more successfully when they were from abroad and more ignorant of the stock names. Expert ball players made better decisions about where to pass the ball when they had less time. Recreational tennis players who had only heard of half of the professional players in Wimbledon 2003 and simply bet that those they had not heard of would lose predicted the outcomes of the matches better than the official ATP-rankings and the seeding. Adam Smith's invisible hand is a metaphor for how collective wisdom emerges from the uninformed masses. 

We can prove that situations exist in which a group does best by following its most ignorant member rather than the consensus of their informed majority, and we can prove that a heuristic that ignores all information except for one reason will make better predictions than a multiple regression with a dozen reasons. Mnemonists, who have virtually unlimited memory, are swamped by details and find it difficult to abstract and reason, while ordinary people's working memory limitations maximize the ability to detect correlations in the world. Limited memory facilitates acquisition of language, in infants and computers alike; the more complex the species, the longer the period of infancy. 

Theories that respect the Law of Indispensable Ignorance incorporate a more realistic picture of people as being partially ignorant. Omniscience is dispensable.