Journal of Behavioural Economics and Social Systems

How Indigenous wisdom can sustain humanity

2022-05-26T08:04:23+02:00

Ancient self-governing practices of Indigenous Australians reveal how modern society can achieve sustainable wellbeing for the environment and humanity. No other existing culture has a longer record. In her Nobel Prize speech, Elinor Ostrom described how pre-modern societies evolved polycentric self-governance to avoid over-exploitation of common life-sustaining resources between competing interests to deny them for everyone. Ostrom identified design principles for self-governing ‘Common Pool Resources’ without the intervention of markets or state. This article outlines how these principles could be enhanced to also: (1) recognise Indigenous wisdom, relationships and practices; (2) apply the design principles to incorporated organisations to create a new model of corporate governance to benefit all stakeholders; (3) introduce system science insights that allow creatures to become self-regulating, self-managing and self-governing; (4) identify a politically compelling tax incentive for shareholders to adopt stakeholder self-governance with the cost of the incentive recovered from stakeholders paying taxes and reducing costs for welfare and regulation. A basis is created on which to introduce a universal wellbeing income from corporate dividends. The principles outlined here allow for corporations to become agents for reducing environmental and existential risks for humanity.

Another way: The intersection between First Nations peoples' ways of thinking and governance, accounting and accountability

2022-05-26T08:47:24+02:00

First Nations peoples' idea of Land custodianship implies that Land cannot be offered, taken, sold, lost or abandoned. This concept does not align with the Anglo-Saxon view of land as an asset which can be owned, sold or transferred between people. A team of researchers from Macquarie University, Southern Cross University and CQ University explore the differences between Indigenous and Western thinking and reflect on future opportunities for research, reconciliation and change.

The anatomy of bad decision making and the role of neuroscience and the Second Track in improving decision making

2022-05-26T09:13:46+02:00

Any poor decision can be blamed on insufficient information, but the paralysis provoked by too much data can be as damaging as snap decisions based on too little. Human judgement must find the right balance between analysis and action, prudence and reform. Entrepreneur Peter Fritz AO and writer Nicholas Mallory discuss the individual and organisational factors behind bad decision making and how it can be improved in business and government today.

Macroeconomics – developments and modern trends

2022-05-26T09:34:09+02:00

Ever since the publication of Keynes’ The General Theory in 1936, both the theoretical and methodological content of macroeconomics, and the role of economic policy, have seen continued change. In contemporary times, macroeconomics is dominated by the New Neoclassical Synthesis (NNS) and the dynamic stochastic general equilibrium (DSGE) models. However, since the Great Recession, the modern mainstream has been increasingly exposed to criticism from various alternatives of a more heterodox nature. The aims of this article are threefold. First, to give a selected presentation on the development of modern macroeconomics. Second, to address why and how the NNS has become the dominant (and, for most mainstreamers, the only) way of analysing macroeconomic phenomena. Third, to present two alternatives to the mainstream that might challenge the future dominance of this thinking.

A new way to govern for eternity based on systems science

2022-05-27T04:39:03+02:00

This article is motivated by the CEO of the largest investor in the world wanting in 2018 “A new model for corporate governance” and that “companies must benefit all their stakeholders”. Firms that benefit all their stakeholders become what Ostrom described in her 2009 Nobel Prize speech as a “Common Pool Resource”. Ostrom identified how “polycentric governance” allowed competing interests, without markets or State, to self-govern life-sustaining resources without denying them for everyone. Key contributions of the article are to identify how: (a) To apply system science to extend and enhance the Ostrom self-governing design insights to corporate entities, (b) Polycentric governance releases and exploits the ability of individuals to possess contrary behaviour to self-regulation, improve risk management, adaption and innovation while enriching democracy denied in societies governed by hierarchies and markets, and (c) A self-funding tax incentive for shareholders to adopt polycentric governance that endows stakeholders with equity to privatise welfare with a universal taxable wellbeing income that funds the tax incentive. This promotes population reduction, less economic inequality and local ownership and control to counter environmental degradations and build sustainable circular bioregional economies for eternity. Polycentric governance is illustrated in sporting and civic organisations with business examples proving its competitiveness and resiliency. The size and costs of governments are reduced to further enrich democracy. Shareholder/stakeholder primacy is maintained for citizens electing politicians who introduce eternal universal benefits for humanity.

The Neuroeconomics of the Second Track: Processes, outcomes and impact

2022-05-27T04:58:01+02:00

Recent research in the fields of neuroscience and behavioural economics offer clues to the success of GAP's Second Track process of productive group collaboration. Entrepreneur and philanthropist Peter Fritz AO explores the ways in which individual and group decision making can be optimised through this approach.

Multi-level abstract games for policy, strategy and technology development

2022-05-27T06:50:49+02:00

Game models provide a basis for solving complex decision-making problems in 'wicked' environments, with explicit bounds on reliability. Problems are 'wicked' primarily because of underlying paradoxical self-referential causal loops in the problem structure, resulting in some questions simply being unanswerable within the problem environment, even with complete information – and we rarely have full information either. Such problems are inherently non-stationary, with environmental change driven endogenously from within the environment itself, and they also involve exposure to terminal failure, generating asymmetries that are difficult to handle. Embodying symmetry properties into game models forms testable decision-making theories in complex environments. Subsequent extraction of usable invariant conditions determines decision making, which might mean policy or strategy determination, planning or artificial intelligence. Invariant conditions can be global or local. Global invariants are exhibited indefinitely in the game. Local invariants hold for limited periods of stability between phase shifts, requiring dynamic detection and response to their dissolution. This amounts to using game models to systematically map non-stationary problems to abstract stationary problems by making recondite symmetry properties definitive. Environment properties are captured at different levels of abstraction, corresponding to the level of uncertainty involved. This mapping means that largely conventional methods can then be applied.

Towards more consistent decision making

2022-05-27T07:05:18+02:00

Kahneman’s latest work takes us one step closer to understanding flaws in human decision making. Policy commentator Ian McAuley reflects on the applicability of Kahneman’s concept of decision hygiene to dealing with complex challenges – such as a global pandemic.