Rational behaviour is maximising ... what?

Utility maximisation

In economics, rational actors are assumed to maximise their utility. However, the fact that world is uncertain means that you can't always know what would maximise your utility, so this is instead amended to expected utility. This means: a rational actor makes the decision that on average produces the highest utility. Many people then take a step further and move from utility to money: rational individuals make decisions that maximise their expected worth.

This assumption also feeds through into a lot of financial modelling and optimisation. For example, valuations using methods such as dynamic programming typically assume that decision making maximises expected utility and nothing else.

But... does this make any sense? To see why it might not, consider what you would do if a billionaire offered you a choice. If you accept, he will flip fair coin. If it comes up heads, he will give you a million pounds, and if it comes up tails you will give him all your assets. Now let's consider the expected value here. If your assets have value A, and you take the bet, then your expected financial worth after the bet is:

0.5 x (A + 1,000,000) + 0.5 x 0 = 0.5 x A + 500,000

Obviously, if you don't take the bet then your assets will continue to be worth A. Therefore, the expected improvement in your financial position if you take the bet is:

(0.5 x A + 500,000) - A = 500,000 - 0.5 x A

So if your assets are worth less than 1,000,000 then you should take the bet if you are maximising your expected worth. What's more, the less your assets are worth, the stronger the expected benefit of the bet, and therefore the more "rational" it would be to take it as an maximiser of the expected.

But do people behave this way? And should they? This bet would mean, for a middle income home owner, that they have a 50% chance of becoming a millionaire, and a 50% chance of becoming a homeless pauper. I think a significant proportion of people would not risk becoming homeless even for the chance of becoming a millionaire. It has been demonstrated experimentally that people are strongly averse to losing what they have, even when there are significant rewards to taking the risk.

As to whether they should... well, despite the fact that many economists equate rational with maximising the mean, it does not seem irrational at all to decide not to risk homelessness. In fact, it seems pretty rational to protect your access to necessities before trying to get the nice-to-haves. But this kind of maximising the minimum, rather than the mean, behaviour is too often ignored.

Agricultural modernisation
 
The same phenomenon crops up in traditional agriculture. New high yield varieties of major crops have slowly spread through the world, but in traditional communities there was a lot of resistance to their use. Why? Don't those peasants want to improve their lives? Modern agricultural experts tended, I think, to see peasants in poor countries as backwards, since the new high yield varieties would make them more money.

But it is seeing yield from a commercial perspective that makes you miss why standardisation on high yield varieties was resisted. From the point of view of the subsistence peasant, the product of agriculture is not just food to sell, but survival into the next year. For this reason, an extremely high value was place on reliability, and the ability to reliably produce enough to survive. The natural consequence of this was:

1. to grow crops that could tolerate tough conditions and still produce something
2. to grow diverse crops so that if one failed there would be another source of food

In other words, the backwards peasant was making the perfectly rational decision to maximise the minimum yield instead of to maximise the average yield. Peasants and subsistence farmers are conservative because their system, while it might leave them hungry, at least minimises the risk of widespread starvation. Any change is risk, and risk is what they are trying to minimise.

The book below, which I would like to read from cover to cover one day, discusses some of these issues in more detail:

A book partially about how peasants maximise the minimum

Raised beds

The first raised bed - surrounded by Raspberries/Blackberries/herbs/skirret/pear trees

One of my jobs today was putting together the first of at least two raised beds in the garden, so that we can grow some annual veg. The bed itself was relatively cheap - four 3.6m lengths of decking at approx. £5 each and 1.5 fence posts at £10 each gives a total of £35 for a 2.6m x 1m bed. This works out at £13.46 / m2. Since I've seen garden centres selling flat pack ones about 1 m2 for £30 or £40, I don't think that's bad.

Of course, I also had to fill it. I turned over the turf underneath the bed and loosed up the soil a bit, which filled out the bottom a bit since when you dig over the soil always expands. I also chucked in soil from a number of empty containers I had standing around. But still, the bed was mostly empty and I didn't have any more soil available.

A bed that size with a depth of 24cm has a volume of 0.24 x 2.6 x 1 = 0.624 m3. Since there are 1000 litres in one m3, this means I needed around 600 litres of soil. Not having any good quality soil free, I bought 600 litres of top soil, compost and manure from the garden centre for about £60 and mixed it together.

So the question now is, what's the best annual veg to plant in my new 2.6 m2 raised bed? I do plan to build at least one more, but we don't have much more free cash right now so it might be another month before I can.

Extreme levels of Roundup in Soybeans

How much of this ends up in your food?

Following on from my previous post on genetic engineering for pesticide or herbicide production/resistance, I found this article via Naked Capitalism. The article is about farmers using ever higher doses of Roundup (a herbicide) to fight herbicide-resistant weeds, and about the ingredients of the herbicide accumulating in crops. To quote from the article:

Seven out of the 10 GM-soy samples we tested, however, surpassed this "extreme level" (of glyphosate + AMPA), indicating a trend towards higher residue levels. The increasing use of glyphosate on US Roundup Ready soybeans has been documented (Benbrook 2012). The explanation for this increase is the appearance of glyphosate-tolerant weeds (Shaner et al. 2012) to which farmers are responding with increased doses and more applications.

 Regulatory agencies have responded to increasing usage not be intervening or even investigating its potential health effects, but by raising the legal limits to align with the current practice of farmers. God forbid that the precautionary principle is applied to public safety if it costs money.

The authors have studied the impact of Roundup on a kind of water flea, and their findings were as follows:

Our own recent study in the model organism Daphnia magna demonstrated that chronic exposure to glyphosate and a commercial formulation of Roundup resulted in negative effects on several life-history traits, in particular reproductive aberrations like reduced fecundity and increased abortion rate, at environmental concentrations of 0.45-1.35 mg/liter (active ingredient), i.e. below accepted environmental tolerance limits set in the US (0.7 mg/liter) (Cuhra et al. 2013). A reduced body size of juveniles was even observed at an exposure to Roundup at 0.05 mg/liter.

Water fleas are very different to human beings, but it does suggest that there might be cause for concern. And if there are the same insidious effects in humans, noticing it will take a while - if something makes people drop dead immediately then it's pretty obvious, but if a chemical has a more subtle effect like reducing human fertility and/or increasing the rate of miscarriage then proving it can take years or decades. Think how many chemicals were widely used in the past but are now banned as unsafe, simply because their danger was more subtle than immediate death.

Of course, many plants we eat do contain chemicals which are hazardous in large doses, so in a sense this is nothing new. But for most of human history, diets were varied enough that exposure to individual toxic chemicals was typically low. However, industrialised agriculture has meant that people now mostly eat a small number of highly productive crops, raised in a similar way. This means that exposure to these major crops is massive, and exposure to any toxins in them is also large. The same kind of market concentration applies to herbicides, so if glyphosate (the active component of Roundup) does turn out to be dangerous to human health, so will a very diverse range of crops that it's been used on or with. A range that is almost certain to increase as the Monsantos of the world engineer resistance to it into more and more crops.

If I had a choice, I would prefer to avoid foods containing high levels of herbicides or pesticides. But I don't have a choice, really - the level of such chemicals is not on the packet, so how can I really know? The only way I can control my own exposure is to grow all my own food, which is not really possible even in a large urban garden. So I'm therefore forced to trust regulators to protect me - the same regulators who have been taken over by those they're supposed to be regulating.

I suppose the only bright side is that so far GM foods have been resisted more successfully in Europe than the US, no thanks to my own government in Westminister. If GM food ends up being herbicide resistant crops, rather than, say, higher yielding crops, then I hope that GM continues to lose the battle for Europe.

Is Chinese Rhubarb safe to eat?

Chinese Rhubarb - Rheum Palmatum Tanguticum

Last weekend I bought the plant shown above from Ashdale Nursery, who specialise in perennial and cottage garden plants. The reason I bought it was that I vaguely remembered it was edible, and because it didn't cost too much. Since then, though, I've googled the plant and found a lot of contradictory information.

On one side are a number of forest garden and permaculture sites. For example, PFAF has this to say:

Leaf stem - raw or cooked[2, 7, 105, 183]. The stem is superior in flavour to the common rhubarb and quite tender[2]. An acid flavour, it is sometimes used as a cooked fruit substitute[K].

 Similarly, the same plant is being sold by Martin Crawford with the following description:

Rhubarb (Rheum palmatum) Turkish

Rheum palmatum. A large perennial from Mongolia, growing to 1.5 m (5 ft) across and 3 m (10 ft) high with very large leaves. Grow in any moist, well-drained soil in sun or shade. Makes a good ground covering plant, and the leaf stalks are edible in the same way as ordinary rhubarb, with a superior flavour; the roots are used medicinally. Hardy to -20ºC.

Rhubarb (Rheum palmatum tanguticum) Turkish Red

A variety of Turkish rhubarb with reddish stalks and leaves.

The Gardeners' World website also explicitly says that the plant is edible:

The large, jagged leaves of this rhubarb bring architectural drama to a moist pond edge. As well as being a valuble ornamental plant, its red stems are full of flavour, making this a variety well worth growing as an edible crop. Divide the rootstock in spring with a knife, leaving one bud on each division, or sow seed in autumn.

On the other hand, Wikipedia makes no mention of the leaf stems being edible (although it does discuss medical uses of the root and rhizomes), and a number of sites selling this species as an ornamental explicitly warn that it shouldn't be eaten. For example:

 Please note: this is an ornamental plant that does not offer any edible produce. Although it is related to the common garden rhubarb plant, it does not produce the same edible red stems. This plant has no edible parts and the leaves are actually poisonous if consumed, as with all varieties of rhubarb.

I am inclined to trust PFAF and Martin, but I think perhaps the first time I will try a small amount just to make sure.

Three economic words with too many senses

As people who read my previous blog might know, I'm not a huge fan of mainstream economics. But there are a few commonly used words that annoy me because they are used in a sloppy and confusing way, or because I think they are misleading. Here's my top three.

Investment

Investment is one of the favourite words of the economic analyst. Apparently every country either has not enough of it or, occasionally, too much. The problem I have is that there are really two perspectives on investment that are often not differentiated when people use the term:

1. 'Investment' = spending of money by an individual to secure more money in future
2. 'Investment' = spending of resources at a societal level to increase productivity in future

Perhaps I can illustrate with an example. As an individual, I might decide that the best way to have an income in retirement is to buy a house which was previously owner occupied and rent it out. Does this pay back for me personally in the long term? Possibly. But the productivity of the economic system is not increased - no new factories were built, no new processes were discovered. Even though for me the house was an investment, it was not an investment in future productivity for society as a whole.

Basically, when people talk about the need to increase investment in a country as a whole, they should be talking about creating or improving productive assets, not buying up existing assets and creating asset price bubbles in the process.
 
Capital

I am constantly confused by what people mean when they say 'capital'. As far as I can tell, the original meaning of the word was assets used in production, for example tools and factories. But then there are people who use it to just mean 'money for investment', and/or 'the total monetary value of physical assets and savings'. The problem is that monetary savings and physical assets are very different things - the mapping between them is not constant. And not only in the mapping between capital as assets and money not constant, it is to some extent arbitrary, as demonstrated during the cambridge capital controversy. 

Production

Another favourite word in economics is the verb 'produce' or the noun 'production'. But the word produce suggests an act of creation, which isn't really an appropriate word for some activities. For example, mining is not an act of creation, it is an act of extraction or depletion of natural capital. Produce seems to be becoming generalised to refer to almost any economic activity with an output, but in some cases it seems inappropriate given the original sense of the word.

This year's hard-to-find plants

Most of the things I've either planted or bought to plant this year were available from lots of different sources. But there were two that were actually quite hard to track down, for reasons that I don't really understand. This year's hard-to-find plants were:

Hablitzia Tamnoides 'Caucasian Spinach'

This plant is a relative of the goosefoot family, and is therefore related to food plants like Good King Henry. Its supposed advantages are that it grows rapidly, producing lots of edible leaves early in the season, it's relatively shade tolerant, and it's perennial. See here for an article written by a fan.

But while growing Good King Henry from seed is easy, this plant is an odd combination of popular and impossible to obtain. On the one hand, it has a group of fans so keen that they've set up a facebook fan group called Friends of Hablitzia Tamnoides, the Caucasian Spinach. On the other hand, the RHS plant finder only knows of three places that sell the plant, and at least one of them no longer sells it.

Luckily, one of those places was Cool Temperate, which I've bought plants from before. Unluckily, when I contacted Phil he told me that the only plants he had had been waterlogged by the wet weather to the point of death. Since I had no other source, I bought one anyway, hoped, and this happened in the last few days:

Hablitzia Tamnoides 'Caucasian Spinach'

Aralia Cordata 'Udo'

Udo, also called 'mountain asparagus', is apparently a popular perennial vegetable in Japan. As the alternative name suggests, the shoots are eaten in spring. Despite its popularity there, and its shade tolerance (a rare quality in vegetables), it is almost impossible to buy here in the UK. And when it is available, it is only available in the form 'Sun King', a variety chosen to look nice in shady corners.

I eventually found a plant supplier called Norwell Nurseries within striking distance who sold the 'Sun King' variety. It's now started growing too, and I've got the perfect spot for it in the shady area north of the garage. I just hope that the ornamental 'Sun King' variety is as good for eating as the varieties grown in Japan.

Aralia Cordata 'Sun King'

Elaeagnus Multiflora - Goumi

Goumi is a medium sized shrub that produces small red edible fruits. Its main advantage is that it falls into the small class of shrubs that:

1. Fix nitrogen without growing too large

2. Also produce something edible

In a medium sized garden, there isn't a lot of space available to be devoted to exclusively nitrogen-fixing plants, so a multi-purpose plant is a great find. Most other fruiting nitrogen fixing shrubs are a bit on the big size - examples of larger plants would be other members of the Elaeagnus family (e.g. Autumn Olive), or Sea Buckthorn.

The problem is that, while better fruiting forms have been selected, getting hold of them in the UK is hard. If you google the most common improved varieties, 'Sweet Scarlet' and 'Red Gem', you'll find hundreds of sellers in the US and basically none in the UK. In fact, in the UK is hard to even find people selling unimproved varieties. This despite the fact that according to PFAF it will bear fruit heavily here. I guess that the mainstream has yet to be convinced about the benefits of nitrogen fixing plants.

The only seller of 'Sweet Scarlet' that I know of in the UK is Martin Crawford of the Agroforestry Research Trust. And he obviously can't meet demand, since I tried to order 3 and he only had one left to send! Next year I might order another one...

The Goumi in my garden - guarded by mesh just in case!

Genetic engineering fails to overcome the flaws of monoculture

I saw an interesting story on the Independent today, claiming that pests are developing resistance to the Bt proteins genetically engineered into some crops. Here is the link:

Worm evolves to eat corn that was genetically engineered to kill it

Although the Independent has gone downhill over the last few years and is rapidly descending into red-top rag territory, I don't see any reason to doubt the story, since evolved resistance is what you'd expect to happen over time.

The reason I think this story is interesting is that it highlights the downsides of misapplying our understanding of genetics. I am not necessarily against genetic engineering for some purposes - fixing genetic diseases in people has my complete support, and introducing genes for some traits into food would be OK too. I have no problem with anyone trying to genetically engineer bigger tastier potatoes for example.

An example of corn monoculture

The problem is when genetic engineering is used to promote and enable the "exterminate everything else" monoculture approach of modern farming. This is doomed to fail because ultimately the pests don't really have anywhere else to go. If you give a plant better disease resistance in a varied ecosystem, the pests will move onto other plants, but if you only grow one plant across wide areas, then the pests must adapt or die. And there are good reasons to expect that adaptation should generally be possible, such as the following:

1. The plant itself must tolerate any toxic chemicals it contains or that are applied, so the chemical cannot be inimical to basic life processes without killing the desired crop

2. Some part of the plant will be consumed by humans, and therefore must also be non-toxic to humans.

3. Plants have been engaged in chemical warfare against pests for as long as both have existed, and yet pests still exist

4. Many plants depend on a supporting web of other life, from pollinators to soil micro-organisms, and in this case any chemical weapon must be selective. Pests may be able to copy non-affected organisms.

The attempt to wipe out all the pests while at the same time retaining a non-harmful, edible plant appears to me to be a war that we simply can't win. The best that can be attained is the fluctuating stalemate which has held throughout history, with one side gaining a temporary advantage for a while which is then neutralised by changes in predator populations or changes in the plants themselves.

Genetic engineering plants to either contain or tolerate poisons is just a risky way to gain a temporary advantage, since there is a high risk of these poisons having adverse effects either on other parts of the ecosystem (e.g. pest predators, beneficial soil microbes, ...) or even on people themselves. How many chemicals were used for decades in the belief that they were safe, only for scientists to later show that they increased the risk of cancer or some other health problem?

A much better approach to pest control is:

1. diversify away from monoculture - give the pests more targets so they either can't specialise, or if they do they cannot wipe out your entire crop

2. Encourage predator populations to maintain a limited but constant stock of pests instead of insisting on complete extermination. This means providing predator and beneficial species with habitat and uncultivated spaces.

3. Use limited and targeted chemicals only when necessary, accepting that they do harm as well as good

But this won't happen as long as the model is industrial monoculture agriculture, where the goal is to minimise the human labour in farming, and to de-skill and automate the process as much as possible.

Global gardens

I was thinking earlier today about the diverse origins of the various plants in our garden. The following is off the top of my head with a bit of googling where I wasn't sure:

North America

Saskatoon
Oregon Grape
Jerusalem Artichokes
Aronias / Chokeberries

South America

Fuchsia

Asia

Goumi
Goji berry
Apple - according to Wikipedia, the main ancestor of malus domestica grows in Kazakhstan.
Pear (?) - according to Wikipedia, the genus originates in China, but it's been widespread across Europe and Asia for a long time
Rugosa Rose
Blueberry Honeysuckle
Flowering quinces
Japanese wineberry

Middle East

Medlar - still popular in Iran!

Europe

Pear (?) - Pears have been in Europe for a long time, but the genus originates in China 
Plum (?) - Does anyone know the exact origin of prunus domestica? It's assumed to be some kind of hybrid...
Cherry
Rosemary
Sage
Thyme
Blackcurrant - also in parts of Asia
Red/whitecurrant
Sweet Cicely
Lemon Balm
Bay Tree

Widespread

Raspberries - various native species across much of the world
Blackberries - various native species across much of the world
Gooseberry - Europe and parts of Africa and Asia. I think there is some cross-breeding with related American species for disease-resistant cultivated varieties.
St John's Wort - across Europe and Asia

Admittedly the list of European plants is longest, which is what you might expect since the UK is part of Europe. But I think it's quite impressive how many of the plants are actually from a very long way away from here originally.

Jerusalem Artichokes

Jerusalem Artichokes - At best a distant relation to true artichokes

As part of filling up the new garden with edible plants, I've been looking for Jerusalem Artichoke tubers to plant. And it turned out to be a bit of a struggle... I remember a few years ago seeing them everywhere, but this year I had to try several garden centres to find them. And it is the season to plant them right now, since the RHS and a number of other reputable websites say March - April.

Having tracked them down, I had to decide where to plant them. And this is where I hit contradictory advice. One of the things which originally attracted me to Jerusalem Artichokes was that numerous sources described them as:

1. Prolific / high yielding
2. Unpicky as to site / soil
3. Tolerating partial shade
4. Spreading to a form a dense cover, invasive if not controlled
5. Casting dense shade below that suppresses (other!) weeds

For example, here is what Patrick Whitefield has to say about them:

The best place for them is either just to the north of the forest garden where the ground is shaded by the trees, or in some place that is shaded by buildings or other tall vegetation. An acquaintance of mine who had an awkward patch in his garden, overshaded by laurel bushes, found that Jerusalem artichokes were the only food plant he could grow there with any success.

...

They are very tough plants, tolerant of poor soils and needing little in the way of cultivation. 

With this idea of their requirements, I had planned to put them in a slightly shady corner, between two hedges, currently overrun with ground elder. My cunning plan was to use them as a crop of last resort for a difficult area, and to try to use them as a barrier to either keep the ground elder in that corner or at least slow down its spread a bit. I had a good two or three square meters partially cleared and ready to go.

But then I read the planting advice on the packet containing the tubers. This advice could be summarised as:

1. Plant them somewhere sunny
2. Keep soil around them moist
3. Keep the soil around them clear of weeds
4. Feed them with compost, manure or fertiliser

This could basically be summarised as "coddle the plants". This is a far cry from a lot of what you can read online, which describes the plants as basically indestructible.

So which set of requirements is correct? It seems to be quite common in gardening that one and the same plant can be described in very different terms by different sources. I think that this is basically because there are so many variables involved that often it's not clear why a plant succeeds in one location but not another, and people then incorrectly extrapolate from their experience. In the case of plant suppliers, I think they also tend to play it safe to avoid complaints.

Anyway, I decided to just go ahead and give it a try. 15 tubers are now planted in my slightly shady three square meters, partially cleared but with ground elder roots still lurking in there somewhere. Hopefully I'll be able to report a dense Jerusalem Artichoke thicket in a few months.

Song of the Day - It Will Not Be Forgotten