329 | Steven Pinker on Rationality and Common Knowledge
Episode
76 min
Read time
2 min
Topics
Relationships, Investing, Fundraising & VC
AI-Generated Summary
Key Takeaways
- ✓Aumann's Agreement Theorem: Two perfectly rational agents with identical prior beliefs who share their posterior probabilities (not raw evidence) must converge to agreement, though not necessarily meeting halfway—their positions can leapfrog randomly before reaching the same conclusion, challenging the war-like metaphor of argument.
- ✓Common Knowledge Generation: Public, conspicuous events create common knowledge instantly—demonstrations in public squares coordinate resistance against dictators because participants see everyone else participating simultaneously, explaining why autocrats suppress gatherings and control media to prevent coordinated opposition from forming.
- ✓Indirect Communication Strategy: People use euphemism and innuendo to convey messages while avoiding common knowledge of those messages, preserving social relationships—saying "want to come up for coffee" maintains plausible deniability about intentions even when both parties understand the actual meaning.
- ✓Financial Bubbles and Bank Runs: Speculative investing follows Keynes's beauty contest logic—investors pick assets they think others will pick, not based on fundamental value—creating recursive mentalizing that generates bubbles, crashes, and runs through common expectation rather than rational asset evaluation.
- ✓Self-Conscious Emotions: Embarrassment intensifies dramatically when transgressions become common knowledge rather than merely observed—experiments show people singing karaoke feel significantly more mortified when they know judges know they're being watched, explaining why avoiding eye contact reduces awkwardness in compromising situations.
What It Covers
Steven Pinker explains common knowledge—when everyone knows that everyone knows something—and how this concept shapes human coordination, social relationships, political movements, financial markets, and why rational people still disagree despite shared evidence.
Key Questions Answered
- •Aumann's Agreement Theorem: Two perfectly rational agents with identical prior beliefs who share their posterior probabilities (not raw evidence) must converge to agreement, though not necessarily meeting halfway—their positions can leapfrog randomly before reaching the same conclusion, challenging the war-like metaphor of argument.
- •Common Knowledge Generation: Public, conspicuous events create common knowledge instantly—demonstrations in public squares coordinate resistance against dictators because participants see everyone else participating simultaneously, explaining why autocrats suppress gatherings and control media to prevent coordinated opposition from forming.
- •Indirect Communication Strategy: People use euphemism and innuendo to convey messages while avoiding common knowledge of those messages, preserving social relationships—saying "want to come up for coffee" maintains plausible deniability about intentions even when both parties understand the actual meaning.
- •Financial Bubbles and Bank Runs: Speculative investing follows Keynes's beauty contest logic—investors pick assets they think others will pick, not based on fundamental value—creating recursive mentalizing that generates bubbles, crashes, and runs through common expectation rather than rational asset evaluation.
- •Self-Conscious Emotions: Embarrassment intensifies dramatically when transgressions become common knowledge rather than merely observed—experiments show people singing karaoke feel significantly more mortified when they know judges know they're being watched, explaining why avoiding eye contact reduces awkwardness in compromising situations.
Notable Moment
Pinker describes how coral, lacking brains entirely, solves coordination problems by using the full moon as a synchronization signal—all coral on the Great Barrier Reef simultaneously release gametes five days after the full moon, demonstrating that even simple organisms exploit conspicuous public events for coordination.
Episode Transcript
Hello, everyone, and welcome to the Mindscape podcast. I'm your host, Sean Carroll. A few years ago, back when we still lived in LA, we had a summer project, my wife, Jennifer, and I. We took boating lessons, Climbing on a powerboat back in Marina Del Rey and, spend a few hours toodling around, learning to, like, park the boat, tie it to the dock, all these things. I've forgotten everything by now. I don't know any of the nautical terms anymore, but there was a moment when if there was a disaster on the boat, I could tell help you bring it back to shore and tie it up to the dock. One of the interesting things was, of course, what you do when you're out there on the water, and there's another boat that is on a collision course with you. Right? Typically, you don't have direct communication with the other boat. You're not on the radio. You can't just say, hey, you know, I'm gonna do this. You need to have some rules about how to behave in such a way that the two boats don't hit each other. Okay? And there are such rules, you know, if you're literally coming right on, then you're supposed to turn to the right, you're supposed to change speed and direction in a decisive way so the other boat can read your implicit boat language, I guess. The point is it works very well, but the reason it works is not only because everyone, you know, the the pilots of both boats know the same rules, but because they know that each other knows the rules. Right? So if I'm supposed to veer my boat to the right, that works because both boaters know that they're gonna veer to the right and they know the other one is gonna veer to the right. So there's a coordination between them and everyone is perfectly safe. This is an example of what philosophers and game theorists call common knowledge. So common knowledge, it's a as we'll talk about in the podcast, it's a slightly misleading term. It doesn't just mean knowledge that lots of people have. It means knowledge that lots of people have, and they all know each other has. So there's sort of an infra regress. I know that you know it, and you know that I know you know it, and I know that you know that I know you know it, etcetera, etcetera. And that's why philosophers love this kind of thing. It also leads to very interesting mathematical results that you can prove in the context of Bayesian reasoning in the presence of common knowledge. There's a very famous theorem called the Aumann agreement theorem that says, roughly speaking, that if you have two perfect perfectly rational agents with common shared priors about a set of claims that could be true or false in the world, prior probabilities, prior credences, and they have some different data, so …
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