The Animal Organism And The Economic Organism

CONTENTS:

  1. THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC
  2. DETERMINISM AND INDETERMINISM – DISAGREEING WITH EINSTEIN
  3. CORRESPONDENCE IN THE CURRENT BASIC DYNAMIC, ORGANIC PROCESS; A DETERMINATE ALGEBRAIC FUNCTION OF THE FIRST DEGREE
  4. CORRESPONDENCE IN THE SURPLUS DYNAMIC, ORGANIC PROCESS; AN INDETERMINATE POINT-TO-LINE CORRESPONDENCE
  5. AVOIDING A VICIOUS CIRCLE OF CRITICISM
  6. THREE IMPLICITLY-DEFINED CIRCULATORY ORGANS
  7. THE TRANSITION TO SYSTEMATIZATION
  8. THE ROLE OF MIND IN THE DEVELOPMENT OF THE HUMAN AND THE ECONOMIC ORGANISMS

 .1. THE STUDY OF ORGANISMS – ANIMAL AND ECONOMIC:

Consider the similarities in the study of the non-human animal organism and in the study of the economic organism.  Compare and contrast method in biology and method in macroeconomics.  We quote from CWL 3, 458 ff./484 ff. “Genetic Method”, then paraphrase that excerpt for its similarity to Method in Macroeconomics.

The non-human animal organism is higher system characterized as a neural manifold in an underlying manifold of cytological events, chemical processes, and physical changes.  The study of this organism may be conducted in three steps:

  • Step 1: Descriptive differentiation of parts
  • Step 2: Relating the parts to other parts and to events, occurrences, operations
  • Step 3: Grasping higher conjugate forms which systematize lower coincidental manifolds

 The quote:

Study of an organism begins with the thing-for-us, from the organism as exhibited to our senses.  A first step is a descriptive differentiation of different parts and, since most of the parts are inside, this descriptive preliminary necessitates dissection or anatomy.  A second step consists in the accumulation of insights that relate the described parts to organic events, occurrences, operations.  By these insights, the parts become known as organs, and the further knowledge, constituted by the insights, is a grasp of the intelligibilities that

  1. are immanent in the several parts
  2. refer each part to what it can do and, under determinable conditions will do, and
  3. relate the capacity-for-performance of each part to the capacities-for- performance of the other parts.

So physiology follows anatomy.  A third step is to effect the transition from the thing-for-us to the thing-itself, from the insights that grasp described parts as organs to insights that grasp conjugate forms systematizing otherwise coincidental manifolds of chemical and physical processes.  By this transition, one links physiology with biochemistry and biophysics.  To this end, there have to be invented appropriate symbolic images of the relevant chemical and physical processes; in these images there have to be grasped by insight the laws of the higher system that account for the regularities beyond the range of physical and chemical explanation; from these laws there has to be constructed the flexible circle of schemes of recurrence in which the organism functions; finally, this flexible circle of schemes must be coincident with the related set of capacities-for-performance that previously was grasped in sensible presented organs.  ¶ The foregoing three steps of anatomy, physiology, and their transposition to the thing itself reveal one aspect of the organism as higher system in an underlying manifold of cells, chemical processes, and physical changes.  Let us name that aspect the higher system as integrator. [CWL 3, 464/489]

Paraphrasing:

Study of a dynamic economic process of production, exchange, and finance begins with the thing-for-us, with the economic organism as exhibited to our senses and bearing upon our feeling of economic well-being.  A first step is a descriptive differentiation of distinct velocitously-functioning parts which seem to interact and coordinate so as to constitute the overall economic process and, since all of the organic parts are internal to the organism, this descriptive preliminary necessitates dissection or anatomy of the economic process.  A second step consists in the accumulation of insights that relate the described economic functionings to economic events, occurrences, operations.  By these insights, the distinct velocitously-functioning organs become known and classified as analytically distinct functions.  This resultant further knowledge, constituted by these insights, is a grasp of the objective immanent intelligibilities that

  1. are immanent in the functioning parts
  2. refer each part to how it can function and, under determinable conditions will function, and
  3. relate the distinct nature and capacity-for-performance of each distinct functioning to the capacities-for-performance of the other functionings.

Thus  the “physiology” of the economic process would follow the described anatomy of the process.  A third step is to effect the transition from the described economic–activities-for-us to the explained economic-process-itself, from the insights that grasp described activities as functional parts to insights that grasp the primary conjugate forms in their field-theoretic relations among themselves, so as to systematize otherwise coincidental manifolds of secondary determinations – such as prices, quantities and pretio-quantital monetary flows. (Click here and here)

By this transition from description of parts to a higher explanatory systematics of interdependencies, one links a Modern Functional Macroeconomic Systematics with the underlying process of everyday making and getting.*  To this end, there has to be invented an appropriate symbolic image of the interconnected Rates of Flow of production, exchange, and finance; in this symbolic image there have to be grasped by insight the field-theoretic laws of the higher macroeconomic system that account for the laws or regularities beyond the range of microeconomic supply and demand; and from these laws there has to be constructed the flexible circle of schemes of recurrence within which (or within whose allowed minor variations) the organic parts function in coordination with one another; finally, this flexible circle of schemes must be coincident with, since constituted by,  the related set of capacities-for-performance that previously was grasped in sensible-presented economic activities.  ¶  The foregoing three steps of 1) anatomy, 2) physiology, and 3) their transposition to the scientific explanation of the whole economic process itself reveal one aspect of the process as the set of field-theoretic, primary, abstract relativities applicable to the secondary, concrete, non-systematic manifold of secondary concrete determinations; and these secondary concrete determinations, such as prices and quantities, would be understood in the light of their being constituents of the pretio-quantital dynamic functional flows systematized and implicitly-defined by explanatory insights and their formulation.  Let us name that set of field-theoretic, primary relativities of the organic economic process “the higher system of macroeconomics” as “integrator” of the underlying non-systematic manifold of pretio-quantital exchanges treated in microeconomics. [CWL 3, 464/489]

Terminology for above:

  • schemes of recurrence – see CWL 3, 118-24
  • non-systematic manifold – see CWL 3, 491-93

The economic process is a threefold process.  In addition to the basic and surplus organs, there is an organ which monitors the process, properly lubricates the process, and supplies the  money needed for expeditious transactions.  The economic process is a three-organ whole.

All science begins from particular correlations, but the key discovery is the interdependence of the whole. … While it is true that a tableau or diagram cannot establish the uniqueness of a system or rigorously ground its universal relevance, it remains that the diagram (of the interconnections of a few precise aggregates) has compensating features that Quesnay’s system of simultaneous equations may imply but does not manifest. … There is the tremendous simplification (a diagram) effects. … The aims and limitations of macroeconomics make the use of a diagram particularly helpful, …  For its basic terms are defined by their functional relations.  The maintaining of a standard of living (distinct process 1) is attributed to a basic process, an ongoing sequence of instances of so much every so often.  The maintenance and acceleration (distinct process 2) of this basic process is brought about by a sequence of surplus stages, in which each lower stage is maintained and accelerated by the next higher.  Finally, transactions that do no more than transfer titles to ownership (distinct process 3) are concentrated in a redistributive function, whence may be derived changes in the stock of money dictated by the acceleration (positive or negative) in the basic and surplus stages of the process. … So there is to be discerned a threefold process in which a basic stage is maintained and accelerated by a series of surplus stages, while the needed additions to or subtractions from the stock of money in these processes is derived from the redistributive area. … it will be possible to distinguish stable and unstable combinations and sequences of rates in the three main areas and so gain some insight into the long-standing recurrence of crises in the modern expanding economy. [CWL 15, 53 and 177]

On such a methodological model (i.e. implicit definition according to functional relation) … classes of payments quickly become rates of payment standing in the mutual conditioning of a circulation; to this mutual and, so to speak, internal conditioning there is added the external conditioning that arises out of transfers of money from one circulation to another; in turn this twofold conditioning in the monetary order is correlated with the conditioning constituted (in the hierarchical productive order) by productive rhythms of goods and services; … There results a closely knit frame of reference that can envisage any total movement of an economy as a function of variations in rates of payment, and that can define the conditions of desirable movements as well as deduce the causes of breakdowns. … [CWL 21, 111]

Economic process – like other world processes – has an immanent intelligibility (Click here and here) consisting of primary abstract relativities which can be applied to the coincidental secondary concrete determinations occurring in a non-systematic manifold.  The whole economic organism is constituted by the schemes of recurrence of its own organic parts and of these parts interacting with one another.  The schemes are under the dominance of an invariant set of abstract principles and laws; nevertheless, the actual concrete working of the economic schemes of recurrence is shot through with the indeterminacy  intrinsic to a non-systematic manifold.  So, while the set of field-theoretic primary relativities is an invariant, the concrete secondary determinations have diverging series of conditions; thus, the occurrences of producings and pricings vary and are probabilistic.  So, precisely accurate prediction is impossible in the general case, since the concrete patterns of aggregate functional occurrences over time are a non-systematic aggregate. The abstract current-determinate-point-to-indeterminate-future-line functional correspondences exhibit concrete determinations in an always-present probabilistic relation between what might be this period’s surplus production and what might be the subsequent accelerated series of basic products.

An event-occurrence has a diverging series of prior conditions.  With complete knowledge of all applicable laws and the series of events, we can look back and explain completely the determinate occurrence, but, because of a diverging series of conditions of future events, we cannot look forward to predict accurately the precise future determination.

.2. DETERMINISM AND INDETERMINISM; DISAGREEING WITH EINSTEIN:

Conditions diverge and scatter.

Our analysis … acknowledged the existence of schemes of recurrence in which a happy combination of abstract laws and concrete circumstances makes typical, further determinations recurrent, and so brings them under the domination of intelligence.  Moreover, it acknowledged that concrete patterns of diverging series of conditions are intelligible; granted both the requisite information and mastery of systematic laws, it is possible in principle to work from any physical event, Z, through as many prior stages of its diverging and scattering conditions as one pleases; and it is this intelligibility of concrete patterns that grounds the conviction of determinists, such as A. Einstein. … However, we agree with the indeterminists inasmuch as they deny in the general case the possibility of deduction and prediction. For while each concrete pattern of diverging conditions is intelligible, still its intelligibility lies not on the level of the abstract understanding that grasps systems of laws but on the level of the concrete understanding that deals with particular situations.  Moreover such concrete patterns form an enormous manifold that cannot be handled by abstract systematizing intelligence for the excellent reason that their intelligibility in each case is concrete. There results the peculiar type of impossibility that arises from mutual conditioning. Granted complete information on a totality of events, one could work out from knowledge of all laws the concrete pattern in which the laws related the events in the totality.  Again, granted knowledge of the concrete pattern, one could use it as a guide to obtain information on a totality of relevant events.  But the proviso of the first statement is the conclusion of the second; the proviso of the second statement is the conclusion of the first; and so both conclusions are merely theoretical possibilities.  For the concrete patterns form a non-systematic aggregate, and so it is only by appealing to the totality of relevant events that one can select the concrete pattern; on the other hand, the relevant totality of events is scattered, and so they can be selected for observation and measurement only if the relevant pattern is known already.  [CWL 3, 650/672-73]

.3. CORRESPONDENCE IN THE CURRENT BASIC DYNAMIC, ORGANIC PROCESS; A DETERMINATE ALGEBRAIC FUNCTION OF THE FIRST DEGREE:

… let the basic stage of the productive process be defined as the aggregate of rates of production of goods and services in process and in a point-to-point correspondence with elements in the emergent standard of living. As explained in Section 6, goods and services are in process when they are neither the mere potentialities of nature nor on the other hand finished products.  As explained in Section 7, goods and services are in a point-to-point correspondence with elements in the standard of living when they are some determinate, though not immutableor unvarying, algebraic function of the first degree with respect to elements in the standard of living.  Finally, just as the aggregate of rates constituting the emergent standard of living is an aggregate of instances of ‘so much every so often,’ so also is the aggregate of rates of production in the basic stage of the process [CWL 15, 28-29]

By “algebraic functions of the first degree” is meant functions involving no exponential powers of the variables other than 1. … To give a simple example, if the number of loaves of bread is represented by the variable y, and the number of bushels of wheat by the variable x, then a relevant algebraic function might be  where brepresents the number of loaves of bread which can be obtained from one bushel of wheat under current technological means, and c represents any fixed loss or gain which is independent of the number of bushels. [CWL 15, 23 ftnt. 25]

.4.   CORRESPONDENCE IN THE SURPLUS DYNAMIC, ORGANIC PROCESS; THE INDETERMINATE POINT-TO-LINE CORRESPONDENCE:

Current flows of surplus products have a current-determinate-point-to-future-indeterminate-probabilistic correspondence with future series of basic products.  Lonergan made these fundamental analytical distinctions between basic point-to-point correspondences and surplus point-to-line (and higher) correspondences; and these precise analytical distinctions are of scientific and explanatory significance. They constitute the basis upon which a complete explanatory superstructure of the current, purely dynamic process can be derived or deduced and constructed.  Each of the two activities – basic point-to-point and surplus point-to-line – has its own distinct capacity-for-performance. They are analytically distinct.  They have different functionalities.  Each has a different correspondence with elements entering the standard of living.  Each has its own prior conditions. Each has its own internal condition of circularity. Each has its own circuit and circulation of Outlays-Incomes-Expenditures-Receipts.  They buy from and sell to one another through “crossovers”.  In the field theory of macroeconomics they are defined by their functional relations to one another in the overall dynamic process.  They are analytically distinct, as are heart, lungs, and liver in the animal organism.  Basic production and sale is hard-wired current-determine-point to-current-determinate-point, while surplus production is current-determinate point-to-future-indeterminate-probabilistic series.

The point-to-line and higher correspondences are based upon the indeterminacy of the relation between certain (surplus) products and the (later ultimate basic) products that (exit the process and eventually) enter into the standard of living. … [CWL 15, 27-28]

.5. AVOIDING A VICIOUS CIRCLE OF CRITICISM:

So-called pundits love to second guess others’ past predictions; then, despite their own past mistakes, they mistake their own hunches for certainties and boldly make new predictions.  (On the other hand, a lot of them do say “on the other hand” to hedge their bets.)  Any criticism of others’ past estimates and expectations of the patterns of future economic events moves in an unnoticed vicious circle.  A criticism of past probabilistic predictions of future occurrences which, looking forward were indeterminate and unpredictable at the time, could only be done by a logically-oxymoronic, look-back “forward retrospective” which was not available at the time.  The critic can’t have it both ways.  The fact of indeterminacy and unpredictability is a legitimate defense against cheap or ignorant criticism of probabilistic estimates and predictions (though not against egregious folly[but who draws the line at “egregious”?]).  It is to avoid that vicious circle, constituted by indeterminate look forward contending with determinate look backward, that Lonergan divided the current-current-current, purely dynamic process of functional flows into a) flows of a basic point-to-point process featuring a current-determinate-point to-current-determinate-point correspondence, and b) flows of a surplus point-to-line process featuring a current-determinate-point to-current-indeterminate-point correspondence

The process always is the current , purely dynamic process.  It is the current process.

The productive process is, then, the (current) aggregate of activities proceeding from the potentialities of nature and terminating in a standard of living.  Always it is the current process, and so it is distinguished both from the natural resources, which it presupposes, and from the durable effects of past production. [CWL 15, 20]

… the productive process was defined as a purely dynamic entity, a movement taking place between the potentialities of nature and products.  In the present section, there has been attempted a dynamic division of that entity..  Elements in the process are in a point-to-point, or point-to-line, or point-to-surface, or even some higher correspondence with elements in the standard of living. … The division is not based upon proprietary differences, … for the same firm may be engaged at once in different correspondences with the standard of living. Again, it is not a division based upon the properties of things; the same raw materials may be made into consumer goods or capital goods; and the capital goods may be point-to-line or point-to-surface or a higher correspondence; they may have one correspondence at one time and another at another. … the division is, then neither proprietary nor technical.  It is a functional division of the structure of the productive process: it reveals the possibilities of the process as a dynamic system, though to bring out the full implications of such a system will require not only the next two sections, on the stages of the process, but also later sections on cycles. [CWL 15, 26-7]

Analysis of the current process insists on the present fact.

The analysis that insists on the indeterminacy is the analysis that insists on the present fact: estimates and expectations are proofs of the present indeterminacy and attempts to get round it; and, to come to the main point, an analysis based on such estimates and expectations can never arrive at a criticism of them; it would move in a vicious circle.  It is to avoid that circle that we have divided the process in terms of indeterminate point-to-line and point-to-surface and higher correspondences. [CWL 15, 27-28]

.6. THREE IMPLICITLY-DEFINED CIRCULATORY ORGANS:

By their mutual exclusion based upon distinctly different correspondences and by their arm’s-length interrelation to one another the basic and surplus processes implicitly define one another.  The constitution of the expansion of the overall process by distinctly different phases – defined by the relation of dQ”/Q’ to dQ’/Q’ (CWL 15, 114) – of expansion endows each circuit with its own current conditions of concomitance and continuity.  Each has its own distinct aggregate functionality (capacity-for-performance) and its own velocitous and accelerative pattern of pretio-quantital and spatio-temporal operation.  Each is a separate and distinct inner organic functioning or part within the whole.  They are analytically distinct, however, their equilibrated crossover interactions constitute a condition of equilibrium for the entire organism.  Disequilibrated interactions – such as boom and systematically-necessary corrective slump – are illness in the organism.

The economic process is a threefold process.  In addition to the basic and surplus organs, there is an organ which monitors the basic and surplus organs, properly lubricates their interactions, supplies the money needed for expeditious transactions.  It is called the “Redistributive Function“.  The economic process is a three-organ whole.

All science begins from particular correlations, but the key discovery is the interdependence of the whole. … While it is true that a tableau or diagram cannot establish the uniqueness of a system or rigorously ground its universal relevance, it remains that the diagram (of the interconnections of a few precise aggregates) has compensating features that Quesnay’s system of simultaneous equations may imply but does not manifest. … There is the tremendous simplification (a diagram) effects. … The aims and limitations of macroeconomics make the use of a diagram particularly helpful, …  For its basic terms are defined by their functional relations.  The maintaining of a standard of living (distinct process 1) is attributed to a basic process, an ongoing sequence of instances of so much every so often.  The maintenance and acceleration (distinct process 2) of this basic process is brought about by a sequence of surplus stages, in which each lower stage is maintained and accelerated by the next higher.  Finally, transactions that do no more than transfer titles to ownership (distinct process 3) are concentrated in a redistributive function, whence may be derived changes in the stock of money dictated by the acceleration (positive or negative) in the basic and surplus stages of the process. … So there is to be discerned a threefold process in which a basic stage is maintained and accelerated by a series of surplus stages, while the needed additions to or subtractions from the stock of money in these processes is derived from the redistributive area. … it will be possible to distinguish stable and unstable combinations and sequences of rates in the three main areas and so gain some insight into the long-standing recurrence of crises in the modern expanding economy. [CWL 15, 53 and 177]

On such a methodological model (i.e. implicit definition according to functional relation)…Classes of payments quickly become rates of payment standing in the mutual conditioning of a circulation; to this mutual and, so to speak, internal conditioning there is added the external conditioning that arises out of transfers of money from one circulation to another; in turn this twofold conditioning in the monetary order is correlated with the conditioning constituted (in the hierarchical productive order) by productive rhythms of goods and services; … There results a closely knit frame of reference that can envisage any total movement of an economy as a function of variations in rates of payment, and that can define the conditions of desirable movements as well as deduce the causes of breakdowns. … [CWL 21, 111]

.7. THE TRANSITION TO SYSTEMATIZATION:

Let the reader rename the double-circuited, credit centered Baseball Diamond “The Diagram of the Physiology of the Economic Organism”.  And let the reader call insight into the diagram “The transition from the insights that grasp described activities as organs to insights that grasp the conjugate forms of organic interaction, which systematize and explain the overall process”.

The economic rhythms that constitute the particular conditioning constituted (in the hierarchical productive order) by “productive rhythms of goods and services” are themselves constituted by economic phases of a rising and flattening expansion.  The rising and petering out call for critical adjustments of basic and surplus incomes to satisfy the changing requirements of the phases of expansion of the process.  The economic whole has a nature of normative phases of expansion that must be respected and honored by adjustment of incomes.  )The adjustment of incomes is easily understood by the seventh-grade algebra and surrounding text of CWL 15, pages 134-35.

Lonergan is careful to distinguish between a “short-term expansion” which involves taking up slack in existing capacity, and “long-term expansion” which elevates the process to a higher level of output and, thus, puts the process on a new basis.  The general form of long-term acceleration is given by the lagged technical accelerator  [See CWL 15, 37]

kn[f’n(t-a)-Bn] = f”n-1(t) – An-1

(The lagged technical accelerator allowing for slack and depreciation in a Schumpeterian creative-destruction economy)

Here are some quotes which treat aspects of phases constituting a long-term expansion of the economic organism:

To increase the rate of saving (in a capital-goods-expansion phase), increase the income of the rich (who have a lower average propensity-to-consume percent). … to decrease the rate of saving (in a consumer-goods-expansion phase), increase the income of the poor (who have a higher average propensity-to-consume percent). … The foregoing is the fundamental mode of adjusting the rate of saving to the phases of the productive cycle.  It reveals that the surplus expansion is anti-egalitarian, … but it also reveals the basic expansion to be egalitarian, for that expansion postulates that increments go to low incomes … [CWL 15, 135-37]

Rates of interest, when increasing, encourage saving (but discourage borrowing).  This double edge is not the per se means of effecting the enormous shift in saving to bring about the transition from a slump or a basic expansion to a surplus expansion.  What is needed is a contraction of purchasing power that will direct spending from the basic market of the poor to the surplus market of the rich.  The surplus phase is anti-egalitarian…….

Traditional theory looked to shifting interest rates to provide suitable adjustment.  In the main we shall be concerned with factors that are prior to changing interest rates and more effective. … …  Evidently, then, suitable migrations are a means of providing adjustments in the community’s rate of saving.  To increase the rate of saving, increase the income of the rich; while they may be too distant from the current operations of the economic process to judge, at least they can put their money into the bank or bonds or stocks, and perhaps others there will see how it can best be used.  To decrease the rate of saving, increase the income of the poor. … The foregoing is the fundamental mode of adjusting the rate of saving to the phases of the productive cycle. [CWL 15, 133-134]

In a proportionate expansion phase both accelerations are equal and positive.  In a surplus expansion phase the acceleration of capital goods exceeds that of consumer goods.  In a basic expansion phase the acceleration of consumer goods exceeds that of capital goods.  In a stationary economy or static phase, both accelerations equal zero. [?]

Now the general theorem of continuity is that this (organic whole) has a nature that must be respected. … to violate this organic interconnection is simply to smash the organism, to create the paradoxical situation of starvation in the midst of plenty, of workers eager for work and capable of finding none, of investors looking for opportunities to invest and being given no outlet, and of everyone’s inability to do what he wishes to do being the cause of everyone’s inability to remedy the situation.  Such is disorganization.  Continuity, on the other hand, is the maintenance of organization, the stability of the sets and patterns of dynamic relationships that constitute economic well-being in a society. [CWL 21, 74]

.8. THE ROLE OF MIND IN THE DEVELOPMENT OF THE HUMAN AND THE ECONOMIC ORGANISMS:

Finally, and of critical importance, we ask the reader to study, on his/her own in CWL 3, pp. 467-79 “Psychic and Intellectual Development” and “Human Development” and to grasp the parallels, resemblances, similarities of intellectual development to economic invention and expansion.  Both developments are constituted by ever broader and deeper insights and higher levels of capacity-for-performance.  In intellectual development it is insights which constitute the development; in economic development insight is basis of invention, innovation, and better management.

Also, regarding technological change as based upon the insights, inventions and innovations and as internal to the organism, see Paul Romer’s Endogenous Technological Change in Bernard Lonergan’s Framework.

Here we display selected passages from CWL 3, 467-79/492-504.  The reader should consult those pages for a full treatment of Genetic Method and intellectual development.

… while we employed genetic method in outlining the development of mathematics, of natural science, and of common sense, still we sere forced to refrain from explaining precisely what we were doing.  To remedy this defect, attention must now be directed to genetic method. (CWL 3, 458/484)

genetic method finds its heuristic notion in development.  In the plant there is the single development of the organism; in the animal there is the twofold development of the organism and the psyche;  in man there is the threefold development of the organism, the psyche, and intelligence. (CWL 3, 459/484)

… conjugate acts are occurrences, events, functioning.  Such are the organic acts of intussusception, assimilation, excretion, the psychic acts of perception, conation, response, the intellectual acts of insight and formulation, reflective understanding and judgment.  Further, such acts are recurrent and their recurrence exhibits a regularity that establishes the relevance of schemes of recurrence. (CWL 3, 459/484-85)

But the regularity in question lacks the fixed and rigid periodicity of the planetary system and indeed, if the functioning of the organism, the psyche, or intelligence is to be understood, one must think not of some single scheme of recurrence but rather of a flexible circle of ranges of schemes.  For the same organism, the same psychic habits and dispositions, the same intellectual development result in widely different operations under different condition and in accord with different circumstances. (CWL 3, 459/485)

… conjugate forms are implicitly defined by empirically established explanatory correlations. (CWL 3, 459/485)

… the conjugate forms of the organism,the psyche, and intelligence are to be discovered by proceeding from the schemes of organic, psychic, and intellectual recurrence to the underlying correlations.  In both cases, one first discerns a regularity of events and then advances to the abstract relation that

  1. is verified in the events
  2. implicitly defines the explanatory specification of the events, and
  3. fixes by their relations to one another the conjugate forms. (CWL 3, 460/485)

Inversely, once correlations are known, it is possible to work out lists of possible schemes of recurrence; from Newton’s laws one can proceed to Laplace’s account of planetary periodicity; from an understanding of the organism, one can conclude to its behavior under given circumstances; from a synthetic account of insight one can set up the procedures of the mathematician, the natural scientist, and the man of common sense. (CWL 3, 460/485)

Nor is this all.  There is the fact of development.  In the course of time the conjugate forms advance from generic indeterminacy towards a specific perfection.  Concomitantly the flexible circles of schemes of recurrence both shifts and expands.  Operations that initially were impossible or extremely awkward and efficient become possible, spontaneous, economical, rapid, and effective. (CWL 3, 460/485-86)

… where the physicist or chemist is out to determine single sets of conjugate forms and consequent schemes of recurrence, the biologist or psychologist, or intellectual theorist is out to determine genetic sequences of conjugate forms and consequent sequences of flexible circles of schemes of recurrence. (CWL 3, 460-61/486)

… there follows the outstanding difference between classical and genetic method.  Classical method is concerned to reduce  regular events to laws.  Genetic method is concerned with sequences in which  correlations and regularities change.  Accordingly, the principal object of genetic method is to master the sequewnce itself, to understand the development and thereby to proceed from the correlations and regularities of one stage to those of the next. (CWL 3, 461/486)

… as the heuristic assumption classical method is the indeterminate func tion to be determined, so the heuristic assumption of genetic method lies in the notion of development. (CWL 3, 461/486)

a development is from generic indeterminacy towards specific perfection. … the differences consist in transitions from generic potentiality to specific determination.  (CWL 3, 461/486)

The sequence of conjugate forms is a sequence of higher integrations of otherwise coincidental lower manifolds of events.  This sequence is intelligible inasmuch as each successive higher integration modifies the lower manifold it systematizes so as to call forth the next higher integration in the sequence. (CWL 3, 461/487)

In the coincidental manifold there emerge corresponding conjugate forms; in accord with the conjugate forms there recur operations in accord with the flexible circle of ranges of schemes made possible and effective by the forms; from the operations there result, not only the higher systematization of the lower manifold, but also its transformation into the materials for the next higher integration in the sequence. (CWL 3, 462/487)

Besides the general direction of development and its general mode of operation, there is the third general consideration of the field in which it occurs. … this field may be described as the finality, the upwardly directed dynamism, of proportionate being.  But in terms of the implications of scientific method, the field may be described more precisely as a generalized emergent probability. (CWL 3, 462/487)

It is emergent probability that provides the compound conditioned series of things and of schemes of recurrence such that the developing organism or psyche or intelligence will have an environment in which it can function successfully.  It is with respect to this field of emergent probability that the genetic sequence enjoys a twofold flexibility., a minor flexibility that reaches the same goal along different routes, and a major flexibility that shifts the goal in adaptation to environmental change. (CWL 3, 462/487)

… the higher integration is within limits, independent of the exact quantities of the lower manifold that it systematizes.  Moreover, the higher the integration, the greater the independence of lower quantities.  (CWL 3, 463/488)

As integrator, this set is related

  1. to inspected organs as the set of functions grasped by the physiologist in sensible data.
  2. to the physical, chemical, and cytological manifold as the conjugates implicitly defined by the correlations that account for additional regularities in the otherwise coincidental manifold, and
  3. to immanent and transient activities of the organism in its environment as the ground of the flexible circle of ranges of schemes of recurrence. (CWL 3, 464-65/489-90)

… the organism grows … … … effective integrator. (CWL 3, 465/490)

The difference between the higher system as integrator and as operator may be illustrated rather simply. … …  … by the higher system as operator. (CWL 3, 465/490)

… what is the operator?  In the general case, it is the upwardly directed dynamism of proportionate being that we have named finality … … … of schemes of the mature type.  (CWL 3, 465-66/490-91)

Now this procedure can be duplicated with respect to successive stages in the development of the same organism, and the juxtaposition of the twofold set of results illustrates the meaning of comparative study. … … … The totality of such information constitutes the data on the operator.  (CWL 3, 466/491)

In general, development is higher system on the move. … … … It is the question in genetic method that parallels the classic question, How does one determine the indeterminate function? (CWL 3, 466-67/491)

There seems to be a general principle of development that is named the law of effect.  It contends that development takes place along the lines of successful functioning. … … … Clearly, though this specification of the operator is extremely general it offers some determination of the direction of development. (CWL 3, 467/491-92)

Clearly, as the conceptual construction s the formulated higher system as integrator, so the emergence of the further question effects its transition into the operator. … So insights accumulate into viewpoints, and lower viewpoints lead to higher viewpoints.  Such is the circle of the development of understanding, and it occurs in the different departments of logic, mathematics, science, common sense, and philosophy, according to differences in the route of the circle. (CWL 3, 469/493-94)

The higher system of intelligence develops not in a material manifold but in the psychic representation of material manifolds. (CWL 3, 469/494)

 

*… the exchange solution is a dynamic equilibrium resting on the equilibria of markets. … every product of the exchange economy must mate through exchange with some other product, and the ratio in which the two mate is the exchange value.  The generality of this equilibrium makes it indifferent to endless complexity and endless change; for it stands on a level above all particular products and all particular modes of production.  While these multiply and vary indefinitely, the general equilibrium of the exchange process continues to answer with precision the complex question, Who, among millions of persons, does what, among millions of tasks, in return for which, among millions of rewards?  Nor is the dynamic solution unaccompanied by a continuous stimulus to better efforts and more delicate ingenuity.  For the uniformity of prices means that the least efficient of those actually producing will at least subsist, while every step above the minimum efficiency yields a proportionately greater return. [CWL 21, 34-35]