The Behavioural Economics of going to War

America and Australia are going to war against ISIS in the middle east. I feel this represents a failure of thinking. Can we use the same psychology that informs behavioural economics to explain this kind of mistake?

Action bias

In the face of what looks like a problem, people tend to want to do something it. Our leaders are no different. They have vast policy-making departments that can give them options for action. The military is one of these, and they are able to present a diverse suite of choices with different risks and costs. Once a range of military options is outlined, the problem is framed in such a way that inaction looks like an extreme choice.

Action bias is a common criticism of government, especially from conservatives:

“Regulators are like the rest of us. They are over-confident, thinking they can understand complex behaviour. Hindsight bias leads them to believe events are more predictable than they are. And, unsurprisingly, they are driven by action bias – a tendency to favour interventionist solutions when faced with a problem.” Chris Berg

They are far more quiet about foreign policy than domestic markets for some reason.

Over-estimating one’s ability. 

Australia and America would surely not go to war if they thought it would be, as has been predicted, an awful failure. Are we more at risk of over-estimating our ability to solve this problem, or under-estimating it?

Clearly the bigger risk is over-estimating.

“Humans are overconfident creatures. Ninety-four percent of college professors believe they are above average teachers, and 90 percent of drivers believe they are above average behind the wheel. Researchers Paul J.H. Schoemaker and J. Edward Russo gave computer executives quizzes on their industry. Afterward, the executives estimated that they had gotten 5 percent of the answers wrong. In fact, they had gotten 80 percent of the answers wrong.” David Brooks in the NY Times


This war may like most other recent wars, end in failure. But that risk is not easy to perceive by use of human intelligence.

Conflation of skills

People assume tall people are good leaders, that beautiful people are skilled, that great footballers will make great coaches, or that Einstein’s views on politics are worth listening to.  We suffer from a bias that lets us believe skills spill over from one area to another.

The US military is very strong. We use the word “powerful” to describe it. But that is principally the power to deliver heat and kinetic energy to precise locations in order to destroy things.

Have we asked if that power is what is really needed to stop ISIS?

To my mind, the fundamental problem is not the existence of the organisational structures, but the attitudes that make people want to join it. If you destroy the structures in a way that fan those attitudes, you get stuck in a growing problem.

This is where the “power” of the military is not necessarily a problem solver. For every ISIS member you kill, you might radicalise on average 0.6 friends, 0.4 brothers, 0.4 sons, 0.2 uncles, 0.2 neighbours. It’s possible every enemy killed creates 1.8 enemies (just as a hypothesis).

Every innocent person you kill probably radicalises many more people. And the deaths of innocents are just about guaranteed whether you use airstrikes or boots on the ground.

In summary, sending the military to solve the problem may be like making the best looking employee into an executive. There’s a cognitive bias at work that may mean we’ve made the wrong choice.

Game theory.

ISIS could be quietly building its support base. Instead it has taken a high-visibility approach of televised beheadings. This seems provocative. If ISIS is deliberately drawing the west into war, should that not give us pause to consider where they payoffs of any war are? If its war they are after, why give them what they want?

This is just a quick summary of a few things that may have gone wrong in this decision process. It’s not supposed to be comprehensive, and of course, I’m not a foreign policy expert. If you have thoughts on these issues, I’d be grateful if you would leave a comment below.

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Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

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