Thomas Aquinas on Decision Making Under Uncertainty, Ignorance, and Risk: The Role of Keynes's Weight of the Evidence Concept in His Approach
17 Pages Posted: 17 Mar 2018
Date Written: March 15, 2018
Eight centuries ago, Thomas Aquinas clearly differentiated between probability and uncertainty in decision making. He viewed probability eclectically as having elements that involved propositions about events, frequency of events, and single events. He found an important role in his approach for a view that is very close to Keynes’s weight of the evidence criterion from the A Treatise on Probability and confidence from Keynes’s General Theory, as well as Adam Smith’s views on uncertainty and confidence.
Aquinas understood that there was much information, evidence, knowledge, or data that was missing or incomplete, so that an estimate of probability was likely to be inaccurate and unreliable in the same manner that an estimate of the just price was likely to be inaccurate, due to missing or incomplete information so that the best one could do in a market transaction was to calculate an upper (and possibly lower bounds) bound on the part of the seller and a lower (and possibly upper bounds) bound on the part of the buyer, where it was likely that the just price would lie, after a process of negotiation, between the upper bound of the seller and the lower bound of the buyer . There was not a precise, exact mathematical estimate of the just price, but an imprecise estimate that is an interval estimate.
It is argued that Aquinas held a similar view with respect to the concept of probability based on his perception of the fact that “calculating probabilities” in an uncertain environment also led to imprecision in the estimate. Aquinas’s developed a concept that is very similar to Keynes’s weight of the evidence concept in Keynes’s A Treatise on Probability and confidence concept from Keynes’s General Theory.
Keywords: Aquinas, Keynes, Smith, Interval Valued Probability
JEL Classification: B10, B12, B14, B16, B20, B22
Suggested Citation: Suggested Citation