Potential Surprise and Choice

The book that, for a time, earned Shackle the status of a star amongst contributors to the theory of choice under uncertainty was Expectation in Economics. It was published early in 1949 and boldly rejected both the use of probabilities as decision weights and the idea that decisions about uncertain prospects are made by aggregating scores for mutually exclusive potential outcomes. In those days, the academic publication process seems, if anything, to have been faster than the modern world of digital publishing and by the end of that year not only had reviews been published but Shackle had already published his first replies to some of his reviewers (Shackle, 1949b; 1949c). However, while the book was something of an overnight sensation, it was actually the product of a decade of work that Shackle had published as a succession of articles (Shackle, 1939; 1940a; 1940b; 1941; 1942; 1943; 1945). It began as an extension of his thinking in his PhD-based first book Expectations, Investment and Income (1938) about the role of investment in business cycles and the ways in which changes in expectations could affect business decisions. Shackle (1949a, p. xiv) reported that ‘The problem and the germ of the solution … were already in my mind in the summer of 1937’. Much later he revealed that he had the key insight on which his theory is founded while he was standing at the kitchen sink (Shackle, 1988 [1983d], p. 232).