The Competitiveness of Nations in a Global Knowledge-Based Economy


9.0 Psychology

9.0 Psychology

9.1 Definitions

9.2 Wetware

9..3 Software

9..3.2 Faculties

9..3.2.1 Reason

9..3.2.2 Revelation

9..3.2.3 Sentiment

9..3.2.4 Sensation

9.4 Qubit PSI

9..5 Reconciliation



Since the organs of sight and hearing are distance receptors, detachment from direct contact with the physical may be retained, for the other senses call attention to the body, so destroying the isolation of the contemplative mind.  Thus the aristocratic attitude of classical Greek culture has been preserved: the conviction of the superiority of the essentially passive aloofness of the meditative spirit and contempt for the practical and manipulative.

Arnold Berleant, ”The Sensuous and the Sensual in Aesthetics”, Journal of Aesthetics and Art Criticism, 1964

* Index & Epithet not in published dissertation

 9.0 Psychology

1.         As has been demonstrated, Gestalt psychology provides an epistemological link between aesthetics, economics and the philosophies of biology (Marjorie Grene), science (Thomas Kuhn and Michael Polanyi) and technology (Martin Heidegger).  Modern psychology, however, like other disciplines of thought, has experienced significant speciation since its appearance in the late 19th and early 20th centuries.  Today one can identify a range of formal psychologies including analytic, applied, child, clinical, comparative, developmental, differential, educational, experimental, Gestalt, humanistic, industrial, individual and physiological schools of psychology.  For my purposes I will consider ways of knowing in the context of analytic and physiological or, more precisely, neuro-physiological psychology.  Before doing so, however, a few more definitions are in order.


9.1 Definitions

1.         Psychology’s ‘knowledge about knowledge’ like Science by Design is dyadic with a physical foundation and psychic faculties for its acquisition.  The first is ‘hardware’; the second, ‘software’.  Alternatively, the brain inclusive of the central nervous system is ‘wetware’ (Rucker 1988), a neologism distinguishing biological or carbon-based artifacts (natural or genetically modified) from silicon-based computer systems or ‘dryware’.  I will first review findings from cognitive psychology about wetware and cognition, i.e., knowing and then examine analytic psychology’s model for its acquisition.  Before doing so, however, I will first link the etymological WIT to psychological ways of knowing via the concept of ‘faculty’.

2.         ‘Faculty’ has several meanings including a branch or department of knowledge (OED, faculty, II, 6).  For my purposes, however, two other definitions will serve.  First, a faculty is “an inherent power or property of the body or of one of its organs” (OED, faculty, III, 3).  In this sense, the human brain is the organ of knowing.  Second, a faculty is “one of the several ‘powers’ of the mind” (OED, faculty, III, 4).  The mind, as the seat of knowledge, hosts a number of distinct faculties.  Etymologically, there are five inner senses, or inwits, including conscience, reason, intellect, understanding and wisdom (OED, inwit, 1 & 2a).  With the exception of reason these terms have not previously been defined.  Conscience is ‘inner knowledge or consciousness’ (OED, conscience, I); intellect is “the power of thought” (OED, intellect, n, 1); understanding means “capable of judging knowledge (OED, understanding, vbl.


n, 1b); and, wisdom is “soundness of judgement in the choice of means and ends” (OED, wisdom, 1a).  Arguably, it is wisdom that economics seeks in studying the satisfaction of human wants, needs and desires with limited means.

3.         Contrasting definitions of faculty - a power of the body or of the mind - correspond to knowing by the senses (wetware) and knowing by the mind (software).  Both have significant economic implications.  On the one hand, the pharmaceutical and medical technology industries address knowing through the physical senses, e.g., Prozac altering brain chemistry and MRIs (magnetic resonance imagers) while the education and psychological testing industry address knowing by the mind.


9.2 Wetware

1.         It was only in the 20th century that wetware was meaningfully addressed by neurophysiology, i.e., the study of the brain and nervous system.  In simple terms, the human brain has developed through a three-stage evolutionary process.  First came the so-called Reptilian Brain whose nature was the subject of Carl Sagan’s The Dragons of Eden (1977).  Sometimes called the ‘rectilinear or R-structure’ it includes the brain stem and its specialized extensions such as the medulla oblongata.  It receives sensations from the nervous system – voluntary and involuntary - and regulates the involuntary system.  Second, overlaying this primitive brain is the Mammalian Brain or cerebellum with its distinctive lobes – left/right, front/back.  Finally, like wrapping paper enfolding the previous two, is the cerebral cortex, the grey ridged matter sometimes called ‘the human brain’ but which we, as a species, share with both the higher primates and cetaceans such as whales and dolphins.

2.         Put another way, the human brain can be considered as a collection of dedicated modular units each adapted to deal with a particular set of problems.  There are distinct modules for color vision, locomotion, language-acquisition, motor control, emotional recognition, etc.  Each module developed through natural selection (Grene & Depew 2004, 340) complimented by their coevolution (Kauffman 2000). 

3.         In this regard, research over the last hundred years has revealed a lateralization of higher brain functions or faculties.  In the simplest, and least controversial terms: the left lobe is responsible for speech; the right lobe for pattern recognition, the front or temporal lobes for reasoning; the back or occipital lobes for visualization.  The latter involves not just physical sight but also imagination, i.e., “that faculty of the mind by which are formed images or concepts of external objects not present to the senses” (OED, imagination, 3). 


4.         It has been recognized that imagination and creativity share a common neurophysiologic basis in the Arts and Sciences (Meyer, 1974).  In both, creativity occurs when an individual steps beyond traditional ways of seeing, doing and making.  This commonality has been recognized in Thomas Kuhn’s analysis of scientific revolutions (1996, 89-90) and Erich Jantsch’s design for evolution (Jantsch 1975, 18) and, more generally, in the coevolutionary process of a self-organizing universe (Jantsch 1980).

5.         The creative process appears to be rooted in the lateralization of brain function.  The left hemisphere is primarily responsible for cognitive activities relying on verbal information, symbolic representation, sequential analysis, and on the ability to be conscious and report what is going on.  The right hemisphere, on the other hand, functions without the individual being able to report verbally, and is concerned with pictorial, geometric, timeless and nonverbal information (Hansen, 1981, 23).  In this regard, noted economist Geoffrey Vickers writes:

I welcome the recent findings of brain science to support the common experience that we have two ‘styles of cognition’, the one sensitive to causal, the other to contextual significance.  I have no doubt that the cultural phase - which is now closing - restricted our concept of human reason by identifying it with the rational, and ignoring the intuitive function, and thus failing to develop an epistemology which we badly need, and which is within our reach - if we can overcome our cultural inhibitions. (Vickers, 1977)

6.         More controversial are the findings of Wilder Penfield (1975), founder of the Montreal Neurological Institute and Julian Jaynes (1978), a controversial Princeton neuropsychologist.  Penfield after fifty years of neurosurgery concluded that the brain stem contains what he called the centrencephalic system, or programmer of the human computer.  Thus, if parts of the brain are damaged, particularly prenatally, the programmer can, within limits, reassign tasks altering the assignment of functions.  It is only, Penfield deduced, when this centre is extinguished that ‘humanness’ vanishes.  Nonetheless, “the mind, I must conclude, is something more than a mechanism.  It is, in a certain sense, above and beyond the brain.  Although it seems to depend upon brain action for its very existence, it is still free” (Penfield 1969, 81).

9.         In the case of Jaynes, his career led him to conclude that a right lobe brain centre (current function unknown) corresponding to the left lobe’s Wernicke’s Area or speech centre was once active.  Given the centrality of language to knowledge such a finding could have important implications.  Dormant in contemporary humanity - except in artistic inspiration (the Muse), the voice of conscience and the voices of the schizophrenic, this right lobe centre was, according to Jaynes, once active and controlling.  It constituted ‘the bicameral mind’.  Auditory hallucinations – the voice of the king or god – guided behaviour, not ego consciousness.  Jaynes concludes that the first writings were not read but rather heard as the voice of its author, e.g.,


with reference to the 18th century B.C.E. Code of Hammurabi (the first written legal code) “someone seeking redress… would come to the steward’s statue ‘to hear my words’ as the stele says” (Jaynes 1978, 198).  He goes on to observe that in hindsight writing replaced the bicameral voice as the controlling social mechanism.

8.         Up the social hierarchy the voice changed from one’s master to one’s lord to one’s king to one’s god.  Ancient humanity was in thrall to a social or collective rather than ego consciousness.  This, Jaynes believes, is a partial explanation for the engineering feats of the Beaker People (Stonehenge) and the ancient Egyptians in the Old World as well as the Olmecs and Mayas in the New.  He compares the work effort of bicameral peoples with the intensity and continuity of effort characteristic today only of schizophrenics suffering compulsive behaviour disorders.

9.         According to Jaynes, the bicameral mind broke down with the near synchronistic collapse of all the ancient civilizations in the Old World about 1500 B.C.E. - China, Crete, Egypt, India and Sumeria.  He similarly explains the collapse of the New World empires of the Aztec and Inca, some three thousand years later, by silencing the bicameral voice through regicide.  It was the assassination of the king/god/emperor rather than the military might of a relatively few soldiers equipped with horses, muskets, steel swords and canon that assured the Spanish Conquest over millions.  In effect, when the voices stopped the people did not know what to do.  One implication of Jaynes’ hypothesis is that ‘ego’ consciousness was not in the past, nor may not be in future, the dominant mode of human cognition.  In this regard, he portrays science, or more precisely our compulsive contemporary search for scientific knowledge as a search for the certainty lost with our expulsion from a bicameral Eden.

10.        Given the lateralization of brain function or faculties, the question still remains: how does the physical brain generate consciousness or mind?  Put another way, how can a macroscopic state called mind result from the microscopic actions of brain cells or neurons?  The answer proposed by Freeman is “circular causality” which “expresses the interrelations between levels in a hierarchy: a top-down macroscopic state simultaneously influences microscopic particles that bottom-up create and sustain the macroscopic state.”(Freeman 1999). 

11.        The transcendent result of circular causality is ‘Mind’ as distinct from brain in keeping with Penfield’s observation that mind is “in a certain sense, above and beyond the brain” (Penfield 1969, 81).  Having proposed a possible physical mechanism for consciousness, however, does not answer the question of how does the Mind – as a distinct, higher order epiphenomenon – know?  Furthermore, as suggested by the controversial findings of Penfield


and Jaynes, our understanding of brain function remains problematic at best.  And, of course, controversy attends all study of altered states (Russell & Chayefsky 1980) of consciousness produced by psychotropic substances as in Aldous Huxley’s Doors of Perception (Huxley 1954).  Nor does a physical explanation resolve the meta-methodological dilemma of ‘knowledge about knowledge’.  I do not perceive the physical sub-structure or wetware of my consciousness.  In my mind’s eye, the conscious ‘I’ is the operator, not some component part.  This operator, this ‘wit’, occupies “the seat of consciousness or thought”; it is the “mind” (OED, wit, n, I, 1) made by knowledge and learning (OED, wit, n, III, 11a).  No matter if it is a divine spark, the result of circular causality or coevolution, the mind is an objective phenomenon that must be treated in its own terms if it, and the nature of knowing and knowledge, is to be more fully understood.


9.3 Software

1.         For most of human history the operator was called ‘the soul’ or “the principle of thought and action in man, commonly regarded as an entity distinct from the body; the spiritual part of man in contrast to the purely physical” (OED, soul, n, 2a).  For the ancient Egyptians there were multiple souls but for the ancient Greeks and Church Fathers, each human being had a single soul constituting a monad, an indivisible unity.  While external entities like demons and angels might influence the soul, it was nonetheless the atomistic soul that faced the world and was responsible for the consequences of its thoughts, words and deeds.

2.         Until the height of the European Enlightenment in the 18th century, the faculties of knowing (of whatever nature or constitution) were thus viewed as revolving around and at the service of an individual undivided conscious self.  Arguably, it was Franz Mesmer (1734-1815) who first demonstrated that there was more than a monad at play.  About 1772 he identified the phenomenon of ‘animal magnetism’ that led to ‘mesmerism’, the precursor of hypnotism in modern psychotherapy.  In Paris in 1778 he demonstrated this new phenomenon by curing diseases at séances.  In 1785, however, when a commission denounced him as an imposter, he retired to Switzerland (A&E, Franz Mesmer,

3.         While Charcot (1825-93), Janet (1859-1947) and Krafft-Ebing (1840-1902) all explored beneath the surface of consciousness it is with Sigmund Freud (1856-1939) that the fissioning of the psychic atom is associated.  Instead of a single ‘I’, the ego of the conscious individual was seen to be but one mental resident along with a personal unconscious, superego and id.  The executive decisions of the ego could, therefore, be countermanded or frustrated by other players in a psychic drama leading from normality to neurosis to, at the extreme, psychosis.  For Freud, however, the unconscious essentially contained only the suppressed content of personal


consciousness, i.e., knowledge too painful to consciously bear.  In this sense, ego was still in control.


9.3.1 Archetypes & Complexes

1.         It was Freud’s protégé, colleague and eventual rival, Carl Gustav Jung (1875-1961), who moved beyond the self- and socially-imposed constraints under which his one-time patron worked.  Jung literally constellated the human mind with a myriad of unconscious forms and structures that are the common inheritance of all humanity – the collective unconscious.  These are archetypes or “primordial, structural elements of the human psyche” (Sharp 1991) that affect consciousness in the course of daily life as well as in dreams, myths and fairy tales.  Crystallized out of common elements shared by peoples across time and cultures they are called ‘mythogems’.

2.         More importantly from a dollars & cents perspective, they can also be crystallized out into highly marketable products like ‘Star Wars’ and ‘Lord of the Rings’, i.e., forms of commercial pattern recognition.  The ‘wise old man’, ‘the hero’, ‘the witch’, ‘the lost treasure’, et al are archetypical roles, forms and images that exist in all human cultures and all human minds.  On the stage of daily life these ‘complexes’ can, consciously or unconsciously, be donned like a costume by an individual playing with others (role playing).  On screen, in literature, in painting and computer games, the audience individually identifies with or ‘knows’ these mythogemic elements and can, as Coleridge said of poetry, ‘temporarily suspend disbelief’ and play along.

3.         Arguably, the star role today is played by ‘the ego’.  This is certainly the conclusion of Erich Neumann, a student and colleague of Jung, in his exhaustive study: The Origins and History of Consciousness (1954).  For Neumann, the ancient myths and religions show progressive development of the ‘hero’ as the carrier of individuality, i.e., of ego consciousness.  Ego consciousness has thus been an evolutionary struggle of one mythogemic complex among others for dominance.

4.         Alternatively called analytic, complex, depth or Jungian psychology, analytic psychology draws heavily on Kant (1724-1804) including concepts such as faculties of knowing and a transcendent function.  In simplified form, there are four morphological features to the Jungian model:

a) Conscious/Unconscious: inhabited by distinct complexes or archetypes including the ego, all of which revolve around a transcendent called the Self;


b) Introvert/Extrovert/Centrovert: direction of psychic attention;

c) Thinking, Intuition, Feeling & Sensation: ways of knowing in varying dominant/subordinate configurations; and,

d) Individuation: the teleological end of life as the realization one’s true unique Self.

5.         Each morphological structure competes for a limited supply of ‘libido’, i.e., psychic energy.  Freud viewed libido as sexual in nature; Jung saw it as the life force which ebbs and flows into many ports of call – sexual, intellectual, emotional, spiritual, et al.  Accordingly, ego is in control only to the degree it can competitively appropriate sufficient libido.  If not, then another complex may occupy the seat of consciousness as occurs in participation mystique, a “term derived from anthropology and the study of primitive psychology, denoting a mystical connection, or identity, between subject and object” (Sharp 1991).

6.         Beyond its descriptive power, analytic psychology has spawned arguably the most widely used psychological testing instruments in the English-speaking world: The Myers-Briggs Type Indicator ®.  Used extensively in North American business and education it attempts to identify and measure the faculties of knowing possessed by an individual.  The mix or ‘type’ reveals how each individual learns best, i.e., acquires knowledge and best makes decisions.  The implications for consumer and producer theory are self-evident. Decades of testing provide a potentially massive database for quantitative analysis (assuming ethical guidelines can be met and corporate owners are willing to share their results). 


9.3.2 Faculties

1.         For my immediate purposes only ways or faculties of knowing will concern us.  I will reconcile Jung’s four faculties – thinking, intuition, feeling and sensation – with an economic epistemology that would be familiar to Adam Smith: Reason, Revelation, Sentiment and Sensation.  These terms are intentionally value-laden.  They are meant to elicit or induce affect defined as “emotional reactions marked by physical symptoms and disturbances in thinking” (Sharp 1991).  A connection between Adam Smith and Carl Jung can be drawn through the work of Immanuel Kant (1724-1804).  Kant was a contemporary of Smith (1723-1790) with whom he shared the concept of faculties of knowing and, as noted above, Jung drew on Kant’s concepts of faculties and a transcendent function.  For each I offer an analytic psychology definition and contrast it with economic usage.

 136 Reason

1.         Reason must be reconciled with the psychological concept of thinking.  Thinking is defined as the mental process of interpreting what is perceived.  It is one of four functions used for psychological orientation or ‘knowing’ – thinking, intuition, feeling and sensation.  Of these either thinking or feeling is usually dominant in an individual.  Both are decision making faculties.  In this sense, both are rational.  Intuition and sensation tend to be subordinate to a dominant function while the remaining dominant tends to be suppressed becoming ‘the lost treasure’ in mythogemic terms.  If thinking is primary, then feeling is automatically the inferior function.  Higher order thinking rigorously excludes feeling and vice versa (Sharp 1991).

2.         The guiding premise of economic epistemology is the rule of reason.  In English, the word ‘reason’ entered the language in the 13th century and derives from the Latin ratio meaning computation and deriving, in turn, from reri meaning to calculate (MWO 2003).  Hence mathematics, by definition, is the highest form of reason and reason as mathematical calculation dominates contemporary economics in the guise of calculatory rationalism.  Nonetheless, non-mathematical linguistic-based logic also qualifies as Reason. 

3.         While Reason, as defined above, is narrower than thinking the archetypal symbol for thinking is the sword or knife, i.e., something that cuts or splits into parts.  Cutting through a problem is a metaphor for decisive thinking dating back to at least Alexander the Great’s solution of the Gordian knot in 333 B.C.E. - a sword.  And, as previously noted, the word ‘science’ derives from the Latin meaning ‘to split’. 

4.         If there is, at the individual level, a human want, need or desire for ‘reasoned’, ‘calculated’ or ‘reductive’ knowledge, and, assuming circular causality is operative, then one would expect an industrial sector specializing in its satisfaction.  This I will call the Science Industry inclusive of the natural and engineering as well as the social sciences to the extent that they apply calculatory rationalism. Revelation

1.         Revelation must be reconciled with the psychological concept of intuition.  In analytic psychology, intuition is the function that perceives possibilities inherent in the present compared to sensation that perceives immediate reality.  It is arational, i.e., it does not explain or judge.  It tends to be subordinate to a dominant function, usually thinking or feeling.  Intuition gives outlook and insight into a garden of magical possibilities as if they were real (Sharp 1991).


2.         In religion, Revelation refers to the disclosure of divine or sacred reality, purpose or truth.  It may come through mystical insight, historical event, or spiritual experience that transforms the lives of individuals, groups and whole civilizations.  The revelations of a Moses, Buddha, Jesus or Mohammed have incalculable social and economic effects ranging from changing patterns of consumption and international trade to geo-political conflict.  More generally, and at the individual level, intuition refers to the power or faculty of attaining direct knowledge or cognition without evident rational thought and inference.  In technological forecasting & assessment, this is called ‘no-knowledge’ (Jantsch 1967, 51). 

3.         It is important to note that in Adam Smith’s time (1776), the Church still claimed, but no longer effectively enforced, its monopoly on Revelation.  The erosion of Church authority began in the 15th century when artist/engineer/humanist/scientist began to claim godlike powers of creation, i.e., creating something out of nothing - ex nihilo (Nahm 1947, 1950).  Their importance, however, extends beyond their works.  They mark the eruption of the individual out of feudal subordination – a problem, as will be demonstrated, of acute concern to Smith.  Most of these Renaissance giants claimed humble birth yet achieved noble ends – new knowledge, new creations.  The ‘Cult of the Genius’ was born (Woodmansee 1984, 446, 47ff, Zilsel 1918]).

4.         This, in turn, set the ground for the 16th century Protestant Reformation’s assertion of direct contact between the individual human soul and the godhead without intermediation by popes, bishops, clergy or philosophers.  Freeing the individual from subordination to birth (the Renaissance) and from a clerical monopoly of revelation (the Reformation), the next step was political: the Republican Revolutions of the 18th and 19th centuries with their declaration that “all men are created equal”. 

5.         Even in the heartland of Reason, the natural & engineering sciences, Revelation or intuition, plays a critical role described by Thomas Kuhn as “scales falling from the eyes”, “lightning flash” and “illumination” (Kuhn 1996, 123).  Of scientific revolutions he writes:

a new paradigm, or a sufficient hint to permit later articulation, emerges all at once, sometimes in the middle of the night, in the mind of a man deeply immersed in crisis.  What the nature of that final stage is - how an individual invents (or finds he has invented) a new way of giving order to data now all assembled - must here remain inscrutable and may be permanently so. (Kuhn 1996, 89-90)

6.         While Revelation may appear narrower than intuition it shares many of the same symbols, e.g., ‘lightening flash’ and ‘illumination’.  Religious metaphors in the West include ‘the burning bush’, the medieval English ‘Cloud of Unknowing’ (Progoff 1957) and Thomas Merton’s 20th century ‘Palace of Nowhere’ (Finley 1978).  Furthermore, the contemporary role


of religion in geo-political competition – economic, political and military – should not be underestimated.  The economic consequences of such knowledge cannot be ignored either.  For example, in Israel and Islamic nations, the pork industry is virtually non-existent because of religion.  The emerging genomics industry is differentially inhibited and encouraged for religious reasons, e.g., fetal tissue research.  Geopolitically, Revelation plays a central role in the ‘Clash of Civilizations’ (Huntington 1993).  Even supposedly ‘secular’ states remain subject to the economic influence of religious Revelation: 

A new Gallup poll shows that 48 percent of Americans believe in creationism, and only 28 percent in evolution (most of the rest aren’t sure or lean toward creationism)… Americans are more than twice as likely to believe in the devil (68 percent) as in evolution. (Kristof 2003)

9.         To put it another way, from an economic perspective, God is real and means business, big business.  If there is, at the individual level, a human want, need or desire for no-knowledge, psychic, spiritual or higher enlightenment, and, assuming circular causality is operative, then one would expect an industrial sector specializing in its satisfaction.  This I will call the Spiritual Industry inclusive of religion and a myriad of psychic movements and communities as well as the ‘self-help’ movement. Sentiment

1.         The psychological term feeling also must be reconciled with economic usage.  It is the psychological function that evaluates or judges what something or someone is worth compared with thinking that interprets what ‘is’.  Both are rational functions.  One or the other tends to be dominant in any individual – thinking type or feeling type.  A feeling is as indisputable a reality as an idea (Sharp 1991).  Feeling also leads to cooperation or opposition between individuals and groups. 

2.         Before the Marginalist Revolution of the 19th century, feeling or rather its economic cognate - Sentiment - played a complimentary role to Reason.  It too, however, was displaced by Bentham’s hedonic calculus.  In The Theory of Moral Sentiments and The Wealth of Nations, Adam Smith stresses the role of Sentiment in the dialogue of the marketplace, e.g., what today is called ‘market trust’ (The Economist Feb. 20, 2003).  To Smith, it was division and specialization of labour together with appropriate ‘market sentiments’ that best assured the wealth of nations.  Douglas North defines such sentiments as “informal constraints” or “norms of behavior, conventions, self-imposed codes of conduct” (North 1994, 360).


3.         Sentiment means “an opinion or view as to what is right or agreeable” (OED, sentiment, 6a).  In order to highlight the economic importance of Sentiment as a way of knowing I will briefly review Adam Smith’s attitude towards subordination of the individual and his ‘sentimental’ concern about the division and specialization of labour.  I will then amplify these findings with a review of the work of cultural anthropologist Grant McCraken and economist Ekhart Schlicht.

Adam Smith

4.         Adam Smith (1723-1790) can justly be called ‘the great mariner’.  It was he who first navigated the limits of economics using what was, in his day, a branch of moral philosophy destined to become the first ‘social’ science - political economy.  Economics, as a discipline of thought or “a recognized field of tooled knowledge” (Schumpeter 1954, 143) is generally dated from the 1776 publication of his The Wealth of Nations.  The foundation for Smith’s concept of knowledge, however, was laid down in his other great work, The Theory of Moral Sentiments, published previously in 1759.

5.         With time, some of Smith’s findings became axiomatic in economics; others, slipped into its murky depths waiting to be recovered by adventurous intellectual archaeologists.  What fell, or was thrown into the water partially reflects the reactionary forces dominating political life after Smith’s death until the fall of empires in 1918.  During his own life, he was considered, by many, a dissident, a friend of French économistes, a Jacobin, a revolutionary. 

6.         Consider the pre-revolutionary reception of The Wealth of Nations in France:

… some weeks before it was first published in London in March 1776.  “Here is a strange adventure,” the abbé Morellet wrote to Turgot on February 26; he relates that as he was waiting, earlier in the day, for the proofs of his translation of “the piece by Mr. Smith” - a section of the early chapter of the Wealth of Nations dealing with corporations and apprenticeships - he received news that the manuscript had instead been seized by the police, and was deemed to be worthy of burning. (Rothschild 2001, 87)

7.         Smith published just as the republican revolution in America (1776) was overthrowing the feudal order of subordination - an order under which some were created superior and others inferior by birth.  The Declaration of Independence (1776) overthrew this old order with its premise: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”

8.         Smith also lived to see the second republican revolution in France overturn the Ancien Regime of privilege replacing it with one of ‘liberty, equality and fraternity’.  He did not,


however, unlike Bentham, live long enough to see both revolutions betrayed – the first by limiting the definition of ‘man’ to white males and the second by self-righteous revolutionary zeal excusing terror as an instrument of freedom. 

9.         Nonetheless, the view of the individual as the foundation of political life was shared by Smith and was consonant with his view of the individual as the foundation of economic life.  In his day, there was in fact only one life.  Politics and economics were, according to Smith, incestuously entangled - political power converted to economic profit and profit to political power.  The regime of privilege in the form of feudal corporations including the Church, mastership guilds, towns and trading corporations was a fundamental impediment to the wealth of nations because it inhibited the individual in pursuing self-interest rather than that of his or her lord, lady or other superior above stairs.

10.        Following the defeat of the French Revolution, the Congress of Vienna in 1815 created the ‘Holy Alliance’ of European monarchies to reinstate political and social subordination and repress republican sentiment among the population.  In Britain (and America), however, Adam Smith’s successors, in his name, argued for business enterprise to be set free from the regulatory vestiges of the pre-revolutionary order.  In effect, economic life was to be divorced from political life.  Political power was no longer to be convertible into private profit, nor private profit into political power – in theory.

11.        One economic axiom derived from Smith is ‘the division and specialization of labour is limited by the extent of the market’.  Both imply knowledge.  In the first instance, ‘know-how’ is required in the division of the production process and, in the second, specialized skills are required to efficiently realize an ever increasingly complex production process.  Division and specialization of labour is the cornerstone of the Wealth of Nations.

12.        To Smith, however, gains had to be counted against costs including what Marx would later call ‘alienation’.  For Smith, division and specialization of labour led to a dangerous narrowing of the individual: “People are not born ‘stupid and ignorant’ but are made so by their ‘ordinary employments’; by the simple, uniform nature of the work they can get” (Smith quoted in Rothschild 2001, 97).  Smith’s answer was public education.  The dialogue of the marketplace and the political arena required citizen workers who could read, write and count.

13.        Moving from division and specialization of labour to that of knowledge, the market has now extended to global proportions.  And, as Smith implied, there has been a narrowing of breadth and an increasing of depth with the individual becoming increasingly atomized, alienated or disinterested in all but a narrow but deep vertical slice of knowledge.  This is


evident in the natural & engineering sciences where ‘normal science’ involves puzzle-solving attention to smaller and smaller fields of vision (Kuhn 1996).  As demonstrated, this leads to incommensurability compounded by ‘just keeping up’.  It is also evident in the Arts where the Art-for-Art’s-Sake Movement (Henderson 1984) generates an ever moving, shifting and changing avant garde (Bell 1976) spinning out ever increasing esoteric aesthetic messages intended for ever smaller audiences – the cognoscente from the Italian meaning ‘the knowing man’ (OED, cognoscente). 

Grant McCraken

14.        The interaction of Reason and Sentiment in economic behaviour is revealed in Grant McCracken’s 1988 study Culture and Consumption.  McCraken begins by describing the birth of consumer culture.  He argues that it was in 16th century England, in the court of Elizabeth I (not in the French court of Louis XIV a century later) that consumption was revolutionized.  To keep Catholic and other nobles loyal in troubled times, she exploited the “hegemonic power of things to communicate the legitimacy of Her Rule”.  Before Her Time, the family was the traditional unit of consumption.  One bought for future generations.  One bought that which would last because it took five generations of patina to move one’s family into the ‘gentle’ class.  She, however, forced those aspiring to rise in station to spend now, for this generation - to be the prettiest peacock at court, the most generous.  Like the potlach (praised as the quintessential example of “caring” capitalism by George Gilder in his influential 1982 paean to the Reagan Revolution entitled Wealth and Poverty) members of the court were compelled to consume their way to honour, power and gentility.  It was rational to do so.  This shift from long-term to short-term consumption had a dramatic impact on the evolution of Western culture contributing to the breakdown of feudal society.  At the same time, however, punitive feudal sumptuary legislation remained in place, and was reinforced in continental Europe after the defeat of Napoleon, to restrict “status fraud”, i.e. persons of lower classes dressing or otherwise pretending to a higher station in society.  

15.        McCraken goes on to explore the subsequent English consumer revolution of the 18th century with particular emphasis on the role of Josiah Wedgewood in shifting the source of fashion (pattern construction) from the nobility to the bourgeois marketeer, or what McCraken calls “market ethnographers” who watched for patterns and regularities and adjusted products and marketing strategies to take advantage of emerging opportunities.  By the 19th century such observers of English society attained unprecedented social mobility.  Thus McCraken notes: “In the person of Beau Brummel we see nothing less than the abrogation of powers of influence that


 had previously been possessed only by the monarch”.  Today, of course, Hollywood and sports celebrities play a similar fashion-setting role – another incarnation of the cult of the genius.

Ekhart Schlicht

16.        In his 1998 book, On Custom in the Economy, German economist Ekkehart Schlicht demonstrates that - despite Bentham’s conviction that it is not rational – custom is critical to the efficient operation of the economy – both on the supply- and demand-side.  Using aesthetics and pattern recognition, Schlicht lays out the nature, persistence and economic implications of custom.  By way of introduction he observes:

…custom affects motivation, conviction, and behaviour in such a perfectly ‘natural’ way that the customary undergirdings of social and economic processes appear hardly discernible, and sometimes even invisible.  In spite of this imperspicuity, custom exerts, in Alfred Marshall’s words, a ‘deep and controlling influence over the history of the world.’ (Schlicht 1998, 1) 

And, custom is not a child of Reason but of Sentiment.

17.        If there is, at the individual level, a human want, need or desire for Sentiment and assuming circular causality is operative, then one would expect an industrial sector specializing in its satisfaction.  This I will call the Arts Industry inclusive of the amateur, applied, entertainment, fine and heritage arts in all media of expression, i.e., the literary, media, performing and visual arts (Chartrand April 2000).  As will subsequently be argued, Art provides the technology of the heart; it manages and manipulates Sentiments. Sensation

1.         Sensation is the psychological function that perceives immediate reality through the physical senses compared to intuition that perceives possibilities.  Both tend to be subordinate to a dominant faculty and are arational, i.e., they do not involve interpretation or judgement (Sharp 1991).  There are, however, individuals whose dominant faculty is sensation – the athlete, dancer, gourmet and arguably the mechanic as well as the drug addict, the debauchee, i.e., “one who is addicted to vicious indulgence in sensual pleasures” (OED, debauchee) and, arguably, all ‘thrill seekers’. 

2.         Sensation is the most primitive faculty.  It is also the most epistemologically problematic.  Everything one knows about the external world (and about the state of one’s own body) is through the senses of taste, touch, smell, sight and sound.  Excepting emergencies, in normal life what they tell us, however, – be it pleasure or pain - is subject to perception and


reflection including context, e.g., knowing one was hit by accident and restraining one’s response.  This is the difference between the raw data of sensation and its meaning mediated by ‘higher’ faculties, i.e., perception.  Overcoming the pleasures of the physical senses has also been seen as critical for the good judgement of rulers.  Thus over 2,000 years before Bill Clinton succumbed to the pleasures of Monica Lewinsky “because I could” (CBS Evening News, “Clinton Cheated ‘Because I Could’”, June 17, 2004), the Indian ‘Machiavelli’, Kautilya, wrote of the king:

he shall restrain the organs of sense; acquire wisdom by keeping company with the aged; see through his spies; establish safety and security by being ever active; maintain his subjects in the observance of their respective duties by exercising authority; keep up his personal discipline by receiving lessons in the sciences; and endear himself to the people by bringing them in contact with wealth and doing good to them.  Thus, with his organs of sense under control, he shall keep away from hurting the women and property of others; avoid not only lustfulness, even in dream, but also falsehood, haughtiness, and evil proclivities; and keep away from unrighteous and uneconomical transactions. (Kautilya c. 250 BCE) Book I, Chapter 7, The Life of a Holy King, The Arthashastra, c. 250 BCE

3.         As a subordinate faculty, Sensation is subject to excitation by a dominant one – usually thinking or feeling.  This process is captured in Timothy Findley’s 1999 novel Pilgrim, a fictionalized biography of Carl Jung.  Very late at night, Jung tries to tell his wife a new intellectual insight when he realizes he is suffering from “intellectual priapism”: “It’s that simple.  Get an idea - get an erection” (Findley 1999, 258).  The point is that psychic faculties are entangled one with the other.   They do not operate alone.  They are dependent, one on the other.

4.         Similarly with respect to religious art, Kenneth Clark in his classic text and BBC series Civilization demonstrates the subordination of Sensation to Sentiment by reference to Bellini’s statue, The Ecstasy of St Theresa:

one of the most deeply moving works of European art… used to convey the rarest and most precious of all emotional states, that of religious ecstasy… in the supreme moment of her life: how an angel with a flaming golden arrow pierced her heart repeatedly: ‘The pain was so great that I screamed aloud, but simultaneously felt such infinite sweetness that I wished the pain to last eternally.  It was the sweetest caressing of the soul by God.’ (Clark 1969, 191)

5.         The primal or instinctoid drives of the Id had, in the Freudian view, been yoked and sublimated by the individual (super ego) and society (custom and law) to produce human civilization.  In this regard, logic and reason are rooted in Western rejection of passion, i.e., of the mind “being acted upon” by an external agency (OED, passion, n, II).  Revelation, of course,


embraces passion, specifically in the West that of Christ (OED, passion, n, I, 1a).  It rejects, however, passions of the flesh including the Seven Deadly Sins – pride, envy, gluttony, lust, anger, greed and sloth.  I will now briefly consider the implications of Sensation in aesthetics, science and economics.


6.         Different individuals often interpret the same objective sensory data differently.  Is it hot or cold?  Is it pleasure or pain?  Is it God or the devil?  The Scientific Revolution, however, achieved something new.  Robert Boyle during the 1650s placed the laws of the physical universe in stasis above and beyond the meddling of human and God (Jacob 1978).  The act of Creation had, once and forever, established the Laws of Nature.  Having set the machine in motion God withdrew and Nature became the legitimate object of the disinterested machines of experimental philosophy. 

7.         What the Scientific Revolution did was to introduce instruments that generate consistent, objective, quantitative measurements of physical sensation through time.  They extend the human senses beyond the subjectivity of the individual observer.  Once calibrated and set in motion a clock ticks at a constant rate per unit time until its energy source is exhausted.  Such measurement is achieved without mediation by a human subject.  In a manner of speaking the Scientific Revolution allowed the study of sensation at a distance – the distance and legitimacy afforded by scientific instrumentation.  In the process, however, it can be argued that ‘instrumental’ perception in the natural sciences has been reduced almost exclusively to sight and to an ever narrowing ‘vision’ thereof (Idhe 1991, 41).  


8.         Similarly, aesthetics traditionally restricts itself to the ‘distant senses’ of sight and sound.  The contact senses of touch, taste and smell lead to obscenity, gluttony and scatology, or more generally, as noted by Berleant they destroy “the isolation of the contemplative mind” (Berleant Winter 1964, 187).


9.         This distancing from the intimate subjectivity of the physical senses is thus shared by: (i) philosophy (a humanity) which isolates itself from the passions; (ii) religion; (iii) aesthetics which traditionally restricts consideration to the distant senses; and, (iv) science that segregates the observer from the observed through instrumentation. 


10.        Economics, however, is another question.  In economics, Bentham’s utile – the unit measure of pleasure/pain - is the foundation of knowledge with pleasure and pain acting as “the two sovereign masters of humanity” (Clough 1964: 825).  One suffers the disutility (pain) of work to earn income to buy goods and services into which firms fix utility that is to be extracted by customers in final consumption (pleasure).  Economics, so defined, is strictly hedonic and materialistic.  Any and all sensations demanding satisfaction become a legitimate object of economic epistemology – no holds barred.  In this sense, economics is an amoral science

11.        In the Benthamite tradition, however, maximizing pleasure was restrained by the tenets of Ethical Hedonism, a very Protestant Ethic.  This ethic, beyond concern with the moral value of work, also involved social inhibitions against conspicuous consumption (Veblen 1899).  As noted by Daniel Bell (1976, 20-22), however, with the collapse of the Protestant Ethic after the Industrial Revolution, only hedonism remains - in all its unrestrained, irrational incarnations.  Without a generally accepted moral code, the law became the accepted social mechanism to moderate individual pleasure-seeking.  In fact, the Benthamite tradition in crime and punishment continues to guide both legal and economic research, e.g. Bentham’s famous and seemingly plausible dictum “the more deficient in certainty a punishment is, the severer it should be” (Becker 1968).

12.        If there is, at the individual level, a human want, need or desire to know sensation, and, assuming circular causality is operative, then one would expect an industrial sector specializing in its satisfaction.  This I will call the Pleasure Industry inclusive of ‘sex, drugs and rock’n roll’ as well as the leisure, sports and food industries.


9.4 Qubit PSI

1.         In each individual, all four faculties of knowing – Reason, Revelation, Sentiment and Sensation – function.  Like quarks, they do not exist alone.  There are no free faculties.  Rather they exist only together uniquely embodied and entangled in the ‘self-awareness’, ‘consciousness’, ‘knowing’, ‘mind’ or ‘wit’ of an individual human being living in a particular place at a particular time and subject to different and varying social conditioning.  For example, the itch for sensual knowledge may be satisfied or sublimated in different ways by Reason, Revelation and/or Sentiment.  For Freud, this was the role of the super-ego.  The yoking of libido or life force is the meaning of the word ‘yoga’.  All major religions traditionally suppress and sublimate sensual needs in return for a promised afterlife.  As has been demonstrated both Arts and Science have similarly restricted knowledge to the distant senses and repressed the contact ones – touch, taste and smell.  Such sensual ways of knowing are immeasurable and


incommensurable and arguably best expressed through Art rather than mathematics.   Finding out what is one’s unique blend and balance of these different ways of knowing - oneself and the world - is the life passage Jung calls ‘individuation’.

2.         This uniqueness colours our individual use of faculties and defines how best we learn.  In the words of James Hillman: “each person [is] the embodiment of an individual destiny” (Hillman 1980, 4).  The entanglement of the four psychological faculties of knowing constitutes our second knowledge Qubit - the PSI which is some function of Reason, Revelation, Sentiment, Sensation.

3.         This uniqueness, however, creates another meta-methodological dilemma.  If knowledge exists only in a unique individual, then knowledge is unique and ‘knowledge about knowledge’ becomes comparatively impossible to obtain.  The individual is, however, not just unique but also social.  Bronowski captures the dualism of the human being as ‘a social solitaire’ (Bronowski 1973).  Each individual shares faculties with other individuals.  Uniqueness is an aesthetic, gestalt or image emerging from the blending, mixing and intensity of these faculties constituting the PSI, i.e., Reason, Revelation, Sentiment and Sensation.  It also reflects a hieros gamos or sacred wedding (Jung [1954] 1966, 5) of mind and body (knowing by the mind and knowing by the senses) that makes us a living human being.  Whether animated by a divine spark or circular causality, to be human is to be married mind and body, or traditionally, body and soul.  Divorce leads to death beyond which component parts fly apart whose final destination remains a matter of metaphysical dispute.

4.         One of the great fears of analytic psychologists like Jung and Hillman, however, is that development of a typology of psychic faculties, functions and directions (introversion/centroversion/extroversion) required to recognize the uniqueness of an individual patient could be transformed into a tool of social control and conditioning, even in the hands of the psychologist:

If even psychology sees man as exemplifying typical functions, then there are no essential differences among human kind.  We are functions, or functionaries, of groupings, an inventory of consumer tastes, actuarial probabilities, marketable skills, opinion. (Hillman 1980, 57)


9.5 Reconciliation

1.         From cognitive psychology, we know that Reason resides somewhere in the frontal lobes; Sentiment in the amygdaloid nucleus; and, Sensation in the thalamus near the top of the brain stem.  Further we know that the thalamus mediates the inflow and outflow (to our limbs) of our physical senses which are routed to and from higher order structures including the


amygdaloid nucleus and the frontal lobes (Freeman 2000).  In this regard, the decision-making or executive function located in the frontal lobes appears to be always matched by an emotional response emanating from the interaction of the cerebellum and brainstem (Freeman 1999).  This appears consonant with analytic psychology’s findings about the judgmental role of thinking and feeling, i.e., broadly defined, both are rational.  To date, the structural location of Revelation or intuition has not been found but arguably it is associated with the visual cortex in the occipital or rear lobe of the brain.

2.         To economics, however, the wetware configuration is of relatively little importance.  What is important is that different faculties generate distinct human wants, needs and desires to know that producers can strive to satisfy.  Thus unlike aesthetic distancing or scientific observation, no moral or methodological limitations are admitted to the PSI.  All the senses – near and far, obscene and revelatory – are admitted even when they clash with calculatory rationalism.  What matters is that human beings have a need to know and this takes many polymorphous forms.  




10.0 Epistemology & Pedagogy

The Competitiveness of Nations in a Global Knowledge-Based Economy