G.L.S. Shackle, Some Reflections on Mr. Gould's Article (1957)

This brief scholarly reply uses Gould’s criticism to clarify the psychological foundations of decision under uncertainty. Shackle distinguishes two questions: whether business uncertainty can be expressed through counting cases, and, if it can, when unfavourable odds come to signify diminished possibility in a unique or rare venture. His governing claim is:

For it is possibility, the question of what can happen, I would still maintain, that is relevant in isolated occasions of deciding.

The distinction makes the imagined scope of outcomes, rather than their relative frequency, central to isolated decisions. Yet Shackle concedes that probability and possibility may cease to be psychologically separable:

Nevertheless, I am bound to admit that if the odds are long enough, lack of probability must somewhere merge, psychologically, into lack of possibility, as no doubt it does in Mr. Gould's example.

Gould’s example consequently exposes a difficulty for potential-surprise judgments: the speculator may attach greater surprise to one prize than to another in ways shaped by odds. Shackle leaves open whether this is justified for a strictly unique experiment. Rather than dismissing the objection, he endorses further investigation of Gould’s proposed modification, in which appraisal considers both mutually exclusive simple hypotheses and composite hypotheses formed by joining subsets of them.

The closing paragraph returns to the logically prior issue: whether the businessman’s evidence permits formulation as odds at all. Shackle acknowledges Graaff’s advice to emphasize the kind of uncertainty—conflicting indications and difficulty of interpretation, described through Carter’s image of “confusion and fog”—instead of the uniqueness of the venture. He retains both considerations. The reply’s significance lies in this double defence: uncertainty concerns both the character of the evidence from which expectations are constructed and the isolated character of the decision, while Gould’s criticism identifies a possible revision within the theory.