Bounded Rationality, Mental Models, and Innovation

By: François Kaboré

February 9, 2015

Mental Models, Compassion, and Good Governance

The deep resonance of President Kim’s message with Catholic social thought and the apostolic exhortation Evangelii Gaudium of Pope Francis is very striking. From the experience of the Ebola crisis, Dr. Kim advocates a change in mental models, that is, in our ways of addressing challenges. From the methodological point of view, President Kim is suggesting a fact-based approach to human challenges. To do so, he questions a typical mental model: the monotonic relationship between cost and value in economics. Based on facts, one has to acknowledge, along with heterodox economists, that individuals make economic choices with bounded rationality (not perfect and unbounded rationality). However, in order to get rid of ineffective mental models, one needs creativity and innovation. From his own experience, he was able, for instance, to use patenting laws creatively to meet the needs of the poorest.
Pope Francis, in his latest apostolic exhortation, Evangelii Gaudium, calls people to an “ever watchful scrutiny of the signs of the times.” This scrutiny of the signs of the times, coupled with good discernment, would shake our blunted consciousness and open our eyes to the urgency of today’s challenges. He adds “certain realities, unless effectively dealt with are capable of setting off processes of dehumanization which would then be hard to reverse.” This “urgency of now,” that goes back to Martin Luther King’s Why We Can’t Wait, has been gracefully predicted by Teilhard de Chardin (quoted by President DeGioia): “the age of nations is past, it remains for us now, if we do not wish to perish, to set aside the ancient prejudices [ie mental models] and build the earth.”
 
In short, from Teilhard to Pope Francis and Jim Kim, I hear the same call: if we let ourselves be moved by compassion (President Kim) or if we are rooted in charity (Pope Francis), and if we let ourselves be questioned by facts (President Kim), or by the signs of the times (Pope Francis), then we “can’t wait.” Then we cannot accommodate old mental models that state that some people could be left to die (President Kim), we would say no to inequality and exclusion (Pope Francis). These are moral imperatives of justice, peace, and the global common good (Thomas Banchoff in his introductory remarks). In that respect, the power of Catholic social thought (from Leon XIII to Pope Francis) is to not let us settle and be at ease in our own mental models (especially when they don’t deliver) but to be as innovative and as creative as the challenges of our times require, in order to make life worthy for everyone or, in World Bank’s terms, to end poverty.  
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