|A Behavioral Contingency Analysis of Deception, Property, Financial Bubbles, and Ponzi Schemes
|Monday, May 31, 2010
|3:30 PM–4:20 PM
|Domain: Applied Behavior Analysis
|Chair: David A. Eckerman (University of North Carolina at Chapel Hill)
|FRANCIS MECHNER (The Mechner Foundation)
|Dr. Mechner received his doctorate in 1957 from the Columbia University psychology department. He remained a member of the department’s teaching faculty until 1960, and continued to conduct basic and applied research in the fields of learning and educational technology until the present time. In 1959 he developed a formal language for codifying simple behavioral contingencies, a language he has since upgraded and applied in a diverse range of fields. Dr. Mechner developed various implementations of self-paced individualized instruction for grades K-12, medical education, and industrial training. As a consultant to UNESCO he led projects for the modernization of science teaching in South America and Asia. In 1969-70 he worked on the original design and prototyping of the Sesame Street television programs, and later developed innovative early childhood development programs for Pennsylvania, Georgia, Alabama, and Nebraska. Dr. Mechner’s experience in economics and finance stems from his having founded and built, since 1960, a dozen business enterprises, each based on some innovative technology. The financial proceeds of these have funded the Mechner Foundation, which conducts research in learning and behavioral technology. Some of Dr. Mechner’s publications and accomplishments in music, art, languages, and chess are cited in the website www.mechnerfoundation.org.
|Abstract: By slicing economic and financial concepts along a different plane than does mainstream economic analysis, behavioral contingency analysis reveals different features, among them the behavioral dynamics that were involved in the financial upheaval of 2008. This approach is based on applying a formal language for the codification of behavioral contingencies to an analysis of the concepts of property, property transfer, value, risk, deception, and consensus.
Property is seen to be a set of behavioral contingencies related to some entity, rather than the entity itself. These contingencies include the actions available to “owners” and “non-owners,” the consequences of those actions, and the effective values of those consequences (taking into account probabilities and time delays).
Property transfers, such as securitization, the creation of derivatives, the bundling of asset-backed obligations, money laundering, and Ponzi schemes—all instances of broader categories like aggregation, partitioning, and multiple-stage transfers—involve alteration of the behavioral contingencies that define the transferred property. Such alteration usually entails an associated clouding and blurring of those contingencies, making the often-touted goal of “transparency” unachievable. The usually intentional result of such property transfers is deception—the deceived party misperceiving or mispredicting the value attribute of a consequence, usually to its detriment.