Knowledge and Information in Social Capital
Knowledge and Information in Social Capital
  • Cha Joo-hak (
  • 승인 2014.04.21 18:44
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The eleventh article of the concrete methodology for building social capital

Wealth is stable, complete, proven and fit information; in other words, knowledge. Information on its own can be worthless and even harmful. Knowledge on the other hand is information which is useful, doing something with, and fit for some purpose.

But Spontaneous Self-Organization clearly proceeds in the direction of increasing complexity, ordered systems, such as human kind, out of an initially unordered state. This triggered the so-called exogenic Self-Organization, on transferring and developing information beyond the information carrier DNA. This led to the development of the Catallactic system, with its institutions such as markets and firms.


Objects have the capacity to distinguish themselves from other objects and from themselves at different times. The interaction of objects, together with the process of making distinctions, results in the transfer of a quantity, so-called information. Some objects are capable of distinguishing themselves in more ways than others. These objects have a greater information capacity. Information forms part of human interface to the world. Yet physical objects are endowed with independent, self-descriptive capacity. They have innate discernable differences that may be employed to differentiate them from others or to differentiate one state of an object from another state. These objects vary in complexity, in the number of ways that they can distinguish themselves.


Information originates in the breaking of symmetries. The symmetry breaking leads me to postulate that information is a way of abstractly representing asymmetries, which requires that all the information in a system be accounted for by the removal of non-uniform distributions of microstates until an equiprobable description is attained for the system. Conceptually in the context of Catallaxy, taking information to be an objective property of an object that exists independently of an observer, a non-conservative quantity that can be created or destroyed and that is capable of physical work, information is the message being conveyed. Therefore, in a general sense, information is "knowledge communicated or received concerning a particular fact or circumstance", or rather, information is an answer to a question.


But Information cannot be predicted and resolves uncertainty. The uncertainty of an event is measured by its probability of occurrence and is inversely proportional to that. The more uncertain an event, the more information is required to resolve uncertainty of that event.


What sort of information Information consists of any attributes that can determine, even partially, the state of an object. This may be genetic information, linguistic information, electro-magnetic radiation, crystal structures, clock faces, and symbolic data strings: practically anything. ‘Information’ in a quantitative sense is synonymously with ‘informatic capacity’, somewhat to be strictly non-epistemic. Information, in its most restricted technical sense, is a sequence of symbols that can be interpreted as a message. Information can be recorded as signs, or transmitted as signals. Information is any kind of event that affects the state of a dynamic system that can interpret the information.


In most cases, it is not possible to understand an information domain exhaustively; Knowledge may be always incomplete or partial. Most real problems have to be solved by taking advantage of a partial understanding of the problem context and problem data, unlike the typical mathematical problems one might solve at school, where all data is given and one is given a complete understanding of formulas necessary to solve them. This is also present in the concept of bounded rationality which assumes that in real life situations people often have a limited amount of information and make decisions accordingly.


Bounded rationality is the concept that in decision-making, rationality of individuals is limited by the information they have, the cognitive limitations of their minds, and the finite amount of time they have to make a decision. It was proposed by Herbert A. Simon as an alternative basis for the mathematical modeling of decision making, as used in economics and related disciplines; it complements rationality as optimization, which views decision-making as a fully rational process of finding an optimal choice given the information available. Another way to look at bounded rationality is that, because decision-makers lack the ability and resources to arrive at the optimal solution, they instead apply their rationality only after having greatly simplified the choices available. Thus the decision-maker is a satisficer, one seeking a satisfactory solution rather than the optimal one. Simon used the analogy of a pair of scissors, where one blade is the "cognitive limitations" of actual humans and the other the "structures of the environment"; minds with limited cognitive resources can thus be successful by exploiting pre-existing structure and regularity in the environment. Humans can be reasonably approximated or described as "rational" entities. But Humans are on average rational, and can in large enough quantities be approximated to act according to their preferences. The concept of bounded rationality revises this assumption to account for the fact that perfectly rational decisions are often not feasible in practice because of the finite computational resources available for making them


Knowledge is a familiarity with someone or something, which can include facts, information, descriptions, or skills acquired through experience or education. It can refer to the theoretical or practical understanding of a subject. It can be implicit as with practical skill or expertise, or explicit as with the theoretical understanding of a subject; it can be more or less formal or systematic. This idea is also present in the concept of bounded rationality which assumes that in real life situations humans often have a limited amount of information and make decisions accordingly. Knowledge is information that is useful, doing something with, and fit for some purpose. But humans all in fact contribute not only to the satisfaction of needs of which they do not be informed, but sometimes even to the achievement of ends of which they would disapprove if they were informed of the ends. Humans cannot help this because they do not know for what purposes the goods or services which they supply to others will be used by goods or services. Information is everywhere, but knowledge is rare. Even a so-called "knowledgeable" person usually has solid knowledge only within some special area, representing a tiny fraction of the whole spectrum of human concerns. Information, as the raw material from which knowledge is produced, exists in superabundance, but that makes the production of knowledge more difficult rather than easier.

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