{"id":499,"date":"2011-07-27T09:10:35","date_gmt":"2011-07-27T13:10:35","guid":{"rendered":"http:\/\/www.synapse9.com\/signals\/?p=499"},"modified":"2013-09-11T09:47:53","modified_gmt":"2013-09-11T14:47:53","slug":"urges-arousal-and-keynes-animal-spirits","status":"publish","type":"post","link":"https:\/\/synapse9.com\/signals\/urges-arousal-and-keynes-animal-spirits\/","title":{"rendered":"Urges, arousal, and Keynes’ “animal spirits”"},"content":{"rendered":"

This is a comment on \u00a0The Concept of \u201cAnimal Spirits\u201d is a Red Herring<\/a>,\u00a0a June 27, 2011 blog post, by the blogger “Lord Keynes”, on exploring what Keynes really meant by people needing the urge to act, as well as a rational expectation…<\/em><\/p>\n

__________<\/em><\/p>\n

Thanks for helping clarify the original meaning of \u201canimal spirits\u201d and helping bring out \u201cthe real J.M. Keynes\u201d.\u00a0 \u00a0\u00a0I agree:<\/p>\n

Keynes uses \u201canimal spirits\u201d in the sense of \u201ca spontaneous [human] urge to action rather than inaction.\u201d<\/p><\/blockquote>\n

The sense in which his use and Descartes\u2019, as<\/p>\n

\u201cthe fiery particles of the blood\u201d<\/p><\/blockquote>\n

are consistent is seen when observing that both would be referring to how people need to be aroused and have inspiration to act, i.e. to make emotional leaps in decision making, and not just form rational expectations.<\/p>\n

That is indeed quite different from our having to be subjective in forming expectations with uncertainties.\u00a0\u00a0 As you say \u201cThe concept of \u201canimal spirits\u201d as used by Keynes is not even necessary to the modern subjective expectations theory.\u00a0\u201c \u00a0\u00a0But then that is the subject you discuss, and seem to drop the question of what Keynes really thought was important about the need for “animal spirits” to allow people to act.<\/p>\n

A related puzzle for understanding \u201cthe real J.M. Keynes\u201d is his mysterious Chapter 16 of The General Theory.\u00a0 It’s his concluding chapter to his grand theory of how to stabilize growth.\u00a0 He oddly spends the whole chapter on the natural limits of his own model, however.\u00a0 \u00a0<\/p>\n

Missed by nearly everyone it seems is that he is discussing what to do when growth becomes unprofitable, and a new model for stabilizing the economy will be needed.\u00a0 \u00a0A compact summary of my writings on it, from a natural systems perspective, interprets Keynes’ insight into natural limits of money<\/a> as it would apply in today’s terms of discussion.<\/p>\n

What’s special about a natural systems view is that the self-organizing systems of nature generally develop by a growth process, much like economies do.\u00a0 Growth itself displays a kind of “animal spirit” of nature, an “urge to act” without foreknowledge of the consequences<\/em><\/span>.\u00a0 Growth is a process creating unique individual things beginning with a burst of self-organization that then only discovers its end when emerging into a new environment.<\/p>\n

You see it in the germination for plants, nucleation of new cultures or storms of any kind, and in the gestation for new organisms, visible as a distinctly explosive growth process that is clearly instrumental. \u00a0\u00a0It’s also implied theoretically, from the physics of energy conservation, that bursts of self-organization are needed for bridging small and large scales of change<\/a>.\u00a0 So it seems to be at the heart of nature’s way of solving the “chicken and egg” problem, of beginning something from nothing.<\/p>\n

So, I think what Keynes seems to be asking in Chapter 16 is what sort of “animal spirit”, what urge to act\u201d, might arise among the beneficiaries of growth to act as a group and bring their financial demands for growth to an end.<\/p>\n

It clearly would be in the interests of both each individual and the whole, to keep the system as a whole from becoming unprofitable. \u00a0\u00a0As rational as that expectation is and clear that nature seems to be presenting us with that choice, we\u2019d still need the urge to act on it and haven\u2019t.<\/p>\n","protected":false},"excerpt":{"rendered":"

This is a comment on \u00a0The Concept of \u201cAnimal Spirits\u201d is a Red Herring,\u00a0a June 27, 2011 blog post, by the blogger “Lord Keynes”, on exploring what Keynes really meant by people needing the urge to act, as well as a rational expectation… __________ Thanks for helping clarify the original meaning of \u201canimal spirits\u201d and … Continue reading Urges, arousal, and Keynes’ “animal spirits”<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","footnotes":""},"categories":[3,6,7,8,10],"tags":[],"class_list":["post-499","post","type-post","status-publish","format-standard","hentry","category-among-best-2","category-mail","category-econn","category-theory","category-pop"],"_links":{"self":[{"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/posts\/499","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/comments?post=499"}],"version-history":[{"count":1,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/posts\/499\/revisions"}],"predecessor-version":[{"id":2500,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/posts\/499\/revisions\/2500"}],"wp:attachment":[{"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/media?parent=499"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/categories?post=499"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/synapse9.com\/signals\/wp-json\/wp\/v2\/tags?post=499"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}