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Monday, September 15, 2003
 

Now that the WTO talks in Cancun have collapsed advocates for various causes have become more shrill and defensive, each seeking to blame the other. What's that old saying about the paternity of failure?

I see it as a textbook example of a problem called low dimensionality frameworks in modeling theory. When you have models that track too few variables you can get absurd results. Even though the model is precise, measures its variables properly and does its calculations correctly it doesn't accurately model any real situations and its projections and predictions describe neither the past nor any plausible futures.

A simple example of this from population biology is a model of population growth that considers resource availability and fertility rates but fails to consider countervailing factors such as parasites and alteration of the environment. A rosy (or gloomy) predication of population growth fails when the population is severely reduced by the external factors.

Each of the advocates in the trade talks was operating with a different low dimensionality model. They have different interests as well which each wished to optimize, and different pressures from the constituencies they represented, but they couldn't negotiate a mutually beneficial agreement that traded concessions to arrive at a net benefit for everyone since their mutually incompatible models didn't recognize one another's projections.

When Ron Bailey says...

...the collapse means that protected industries and sectors all over the world will still get their subsidies and still overcharge consumers for many more years to come. In fact, a new and very damaging wave of protectionism could sweep the globe given the current shaky world economic situation. Second, rich country anti-globalization nongovernmental organizations (NGOs), will take this opportunity to continue their campaigns to undermine the legitimacy of the WTO and free trade while promoting their trade-killing environmental and social concerns into any future WTO agreements.

...he is precisely inaccurate. He operates his model correctly and reports its results, there are no errors in the calculations, but the low dimensionality of his model that considers social and environmental factors to be irrelevant to prosperity (not to mention desirability) prevents him from accurately portraying plausible futures.

The models of G33 members are also of low dimensionality as noted previously in Is and Ought, Statistical Obscurantism, and Crime and Punishment.

Europe with its CAP has been portrayed as the villain by many, especially after its attempt, along with Korea and Japan, to link agricultural concessions to the 'Singapore' issues of competition rules. Europe's high levels of bureaucratic authoritarianism and the European Union project to increase and extend bureaucracy to more nations - perhaps eventually to the world through supranational institutions such as the UN - is also a model of low dimensionality that fails to include the economic, cultural and political aspirations of other negotiators and so also makes absurd predictions and projections.

Fittingly, the way forward is neither bureaucratic nor supranational. The various contenders in this conflict aren't bad guys, not entirely, they are unaware of models that have sufficiently high dimensionality to make useful projections. A small multidisciplinary organization could develop these rich models and communicate them to the various power centers. One moderately endowed think tank with widely respected spokespersons could set it in motion. There are hundreds of such enterprises in the world that each have a narrow agenda, it seems that there could be at least one enterprise that is more broadly focused and open minded.

Oddly perhaps, this can do organization might well be American. As noted in this Economist article:

The Americans, for one, came into this summit talking a good game. They proposed to eliminate tariffs on all manufactured and consumer goods by 2015, and to cut agricultural tariffs by 76% over five years. They were prepared to be bold, they said, if other countries were bold too.

posted by back40 | 9/15/2003 01:44:00 PM

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