Saturday, September 22, 2012

Virtual Integration and the Partisan effect

So there are gazillion bytes of data already on the internet and a few billion bytes get added every hour. Interactions, commerce and information are all virtual. 
I've always believed that the accuracy of counter intuition is borne out of lack of a deep analysis in conventional views.
On the surface, this virtual information overload can only be a good thing - everyone has access to it and consequently can take an informed stance - right ? 
WRONG!
I conclude that the net effect of information overload is infact a more partisan and confused world. 

Here's why - Non Empirical Information on the net or news has the following features :
  • They are made by commentators pedaling a specific view. The intent is to say something is wrong and something else is right
  • Information is devoid of context. 
  • Oversimplification is the order of the day. The premium is placed on people who can break down complex blocks of data into something that the layman can understand. While this has it's advantages, the dangerous unintended consequence is that it shapes large scale opinion through superficial analysis. The devil is always in the details and devoid of them - opinions are like the -you know what holes- that everybody has...
  • Most of us do not take the onus to really understand underlying concepts prior to taking a stand. We rely on personal priors, effective articulation and anointed expertise to direct us. In other words, we are open to manipulation. 
Let's take the example of the reactions to FDI policy - if I had a rupee for every negative conclusion drawn on the policy - I'd have enough to pay for my next stint at the Kerala Ayurvedic massage parlor.
We conclude it is bad without an understanding of :
  • Fiscal deficit and federal debt levels
  • Significance of FDI to growth
  • The implications of slow or stunted growth on India's economy
  • Why governments borrow ?
  • How economies grow ?
  • Inflation, deflation and stagflation etc. 
After reading reasonably on the subject - I am as ambivalent as ever, but I feel that FDI is a good thing if implemented correctly.  
However this post is not about whether the general populace have got FDI right - it's more about the general implications of information making us more partisan than ever. If one despises the current govt. - they are more inclined to be taken in by the naysayers - if one likes them - they are more likely to follow articles that are positive. And that's the fundamental problem - despite all the information - it's not the specifics and the context but our prior dispositions that continue to drive us...
I'm going to leave this open ended as I don't have sufficient conviction to state a circumvention or a possible solution to this issue. 
Instead I'm going to state another example - It's been fun to see the democrats and the republicans go at it with regards to the fiscal situation management in the USA. While one set load their arguments in favor of more spending to grow - the others go the other way in favor of restraint and austerity. The general readers who don't know squat about Keynes or Hyak are neatly segregated along their natural predispositions. 

Arriving at an opinion should be a 3 step process :
Information -> Analysis -> Conclusions
When we get sucked into a narrative, we skip the key middle step, thereby rendering our opinions useless. The real travesty is that we inadvertently perpetrate the bad effects of half knowledge on a large scale !

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