Dear Ross,

Thanks for your thoughtful response to my posting from last night. I 
have been driving all day today and so am only reading e-mail just 
now for the first time since  I sent my posting last night.

Your comment about Keynes being about observation, as opposed to 
Knight's concern with the necessity of action still strikes me as 
wrong. In particular, you say, "For Keynes, as I understand him, even 
after reading your comments, uncertainty is rooted in the problem 
that the observer cannot know things." In the _Treatise on 
Probability_ this would not ring true. (And I assume that we are 
talking here largely about what these two men had said circa 1921.) 
Keynes says there that probabilities are known through intuition, 
which would (on his theory) contain the information of one's 
observations, but would except for some rare cases that he does not 
explicate at length, result in a person being prepared to act 
ethically on the known probabilities. In the
_Treatise on Probability_, Keynes does  not talk at any length about 
people's ignorance causing them to  hesitate to act. The only time I 
can recollect his talking about indecision because of the (limited) 
state of one's knowledge is in reference to the case of 
equiprobability where he posits the case of Buridan's ass who cannot 
make up his mind between two equally desirable choices. This is a far 
cry from the type of indecision and ignorance that you seem to want 
to make central to Keynes's theory of probability (circa 1921). In 
1921, Keynes argued that probabilities are objectively known logical 
relations; they fall short of certainty, but for any state of 
knowledge held by a rational person there is an objectively correct 
probability; being short of certainty is not a bar to action in any 
serious sense in Keynes's theory of probability (circa 1921).

Now, it is true that Keynes does not seem to conceptualize the need 
to act in the sort of urgent way that you describe for Knight's 
approach. But I still do not think that your dichotomy between ACTION 
and OBSERVATION has the kind of validity you want for it in 
differentiating between Keynes and Knight. You may be onto an 
important difference, but I do not believe that it adds up to the 
kind of framing you want it to give for Keynes's thinking.

Yours,

Brad Bateman