By George Soros
The concept of reflexivity is very simple. In situations that have thinking participants, there is a two-way interaction between the participants' thinking and situation in which they participate. On the one hand, participants seek to understand reality; on the other, they seek to bring about a desired outcome. The two functions work in opposite directions: in the cognitive function reality is the given in; in the participating function, the participants` understanding is constant. The two function can interfere with each other by rendering what is supposed to be given, contingent. I call the interference between the two functions "reflexivity". I envision reflexivity as a feedback loop between the participants` understanding and the situation that the concept of reflexivity is crucial to understanding situations that have thinking participants. Reflexivity renders the participants` understanding imperfect and ensures that their actions will have unintended consequences.
The nature of the interference between the cognitive and participating functions is not so simple, and its implications are still not properly understood. The assertion that our understanding of the world in which we live is imperfect is so banal that it hardly needs any elaboration. The way our senses work, the way language is structured, and many other factors combine to render our understanding imperfect; but the imperfection introduced by reflexivity is more specific and needs further elucidation. The imperfection I am concerned with arises because we are participants. When we act as outside observes we can make statements that do or do not correspond to the facts without altering the facts. As consequence, we cannot base our decisions on knowledge. We my know many things, and the more we know the better we are placed to make right decisions, but knowledge alone is not sufficient basis for making decisions. We are confronted with a situation that inherently unacknowledged and participants could act on the basis of knowledge. But that is not the case. The situation is unknowable because the participants` views do not correspond to the situation. If this seems like circular logic, well, it is. Participants are caught in a situation characterized by a circular feedback I have called reflexivity, and trying to understand it forces them - and us, observes who seek to understand situations that have thinking participants - into circular logic. That is the point that requires further elucidation.
The traditional correspondence theory of truth sees knowledge as being expressed by true statements. The statement X is true is, and only if, the fact described by X actually happens. Facts have to be independent of the statement that refer to them in order to constitute a reliable criterion of truth. But participants` decision relate to the future, and the future is contingent on the participants` decisions in the present. Therefore, future facts do not constitute an independent criterion by which the current thinking of the participants could be qualified as knowledge. Even if the outcome happened to correspond to some participants` expectations, that would not qualify those expectations as knowledge because the correspondence may have been brought about various participants` decisions. To claim that expectations are based on knowledge is to deny that reflexivity plays any role in shaping the course events.
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