In Pursuit Of A New Economics: The Layered Agent (Extended)

Originally posted here; now updated and expanded

Rogue Missive #121 | Jan 20, 2026

Layered Agent

Human systems rest on a layered metaphysics of human action, where purposeful behavior emerges from the convergence of cognitive processes, biological imperatives, subconscious drives, cultural norms, and environmental realities. Unlike Austrian economics, which ultimately rationalizes these inputs as “preferences” formed by a sovereign cognitive actor, human systems treats the economic actor from the ground up as a multilayered agent, with different layers often pulling in different directions and sometimes pursuing entirely different aims.

In this view, an action may occur not because it is in the narrow self-interest of the individual organism, but because it benefits a higher-level system, even at the ultimate cost of the individual’s life.

A man rushing into a burning building to save a stranger is not maximizing his individual survival or comfort. From a narrow rational-actor model, the behavior is irrational. But from a layered-agent perspective, the group-survival and cultural layer, protecting women, children, tribe members, or innocents, has temporarily overridden the individual organism’s self-preservation layer. The culture is, in effect, acting through him.

The same can be said for collective psychosis. An action may occur that keeps the individual from thriving, or even drives them into misery or self-destruction, not because it serves their interests, but because a pathological memetic or ideological layer has seized control.

In episodes of mass hysteria, financial manias, religious cults, or ideological purges, individuals routinely adopt beliefs and behaviors that destroy their health, wealth, families, and even their lives. These actions are not the result of rational self-interest, but of a memetic or ideological layer overriding both biological welfare and individual psychological stability. Here, the culture is no longer serving the individual; the individual is being consumed by the culture.

Austrian economics deliberately treats all action as the expression of “preferences,” abstracting away from the psychological, biological, and cultural origins of those preferences in order to preserve a unified, value-neutral, and internally consistent theory of action. The cost of this generality is that no real-world situation ever exactly matches the model. Its predictive power is therefore limited. It works in theory, but not in practice.

Human systems begins from the opposite direction. It emphasizes the actual makeup of the agent itself, abstracting away from individual actions in order to gain real-world applicability and macro-level predictive power. At the same time, human systems is not deterministic. Individual actions are the expression of multiple interacting layers: the cognitive mind, culture, collective psychosis, biology, and environment. These can be roughly grouped into conscious and subconscious processes, but in practice they operate together as a single, inseparable system.

• Cognitive mind – conscious reasoning and reflection
• Culture – Inherited norms and shared conscious and subconscious beliefs shaping perception and behavior. These are beliefs about the good life, not specific facts.
• Collective psychosis – False beliefs contradicted by empirical reality, inspiring extreme or irrational behavior and actions.
• Biology – instincts, drives, evolved behavior patterns.
• Environment - hot or cold, wet or dry, delta or desert, plains or mountains, etc.

Subjective Value

Subjective value drives individual action, but it does not arise from a single, sovereign act of will. It emerges from a stack of interacting layers. We know this because these layers can be partially isolated and because human behavior shows strong, repeatable patterns across similar conditions.

Humans placed in similar circumstances tend to develop similar valuations and preferences. When behavior reliably converges under shared conditions, preferences are being shaped, constrained, and channeled by those conditions. This is true of irrational conformity as much as rational conformity.

In fact, the strongest evidence against sovereign preference formation is irrational conformity itself. Mass hysterias and memetic psychoses can grip a population even in the absence of any real trigger, yet still generate genuine symptoms, panic, and cascading social damage as if the threat were real. Here, preferences are not being “chosen” in any meaningful sense; they are being produced by the social and psychological environment.

The same logic applies to culture, class, religion, and place. Individuals from the same culture, class, religion, or city are free to differ, but in practice they tend to align in their values, tastes, fears, and aspirations to a remarkable degree. Human systems instead takes this convergence seriously as evidence that people are layered agents, not isolated, self-authoring individuals.

CogSci

Modern cognitive science and neuroscience increasingly reject the idea of a single, sovereign, context-free intellect directing human behavior. Instead, the mind is understood as a distributed, layered system composed of partially independent subsystems, including emotions, bodily states, instincts, habits, and socially learned ways of seeing and acting.

Neuroscientific work, most notably Antonio Damasio’s research on the somatic marker hypothesis, shows that emotion is not a distortion of reason but a prerequisite for practical decision-making. Individuals with intact logical reasoning but impaired emotional processing become unable to make effective decisions in real-world contexts. This shows that “reason alone” is not what guides revealed preference through action.

At the same time, evolutionary psychology and social psychology demonstrate that human cognition is structured by selection pressures and social environments long before conscious deliberation enters the picture. Humans reliably conform to social norms, imitate dominant behaviors, and internalize cultural patterns in ways that cannot be explained by a model of isolated, self-authored preference formation.

Standard cognitive science typically stops here, describing the mind as a collection of interacting modules or processes. Human systems goes one step further and makes the ontological claim explicit: these layers are not merely components inside an individual, but expressions of real, persistent systems that exist above and below the individual level. Biological evolution, cultural evolution, institutional structures, and memetic systems are not just influences on behavior; they are selection-driven processes that act through human beings.

In this sense, the individual is not a sovereign origin of action, but the vector sum of layered causal systems. The individual is a pattern, not a particle. Just as the human body is the phenotype of genetic evolution, the human mind and its patterns of action are, to a significant degree, the phenotype of culture. A body is not something plus genes; a body is the expression of genes in an environment. Likewise, an individual actor is not something plus instincts, culture, microbes, and incentives. The agent is the expression of all of that at once.

Preferences, in this sense, are expressions of selection pressures. This unifies biology, culture, economics, psychology, and history into a single causal picture.

Individuals remain morally responsible in practice because they are the outward expression of the system. Moral responsibility and consequences are necessary for some layers of the system, like culture, to survive. Even though the individual is not an independent or sovereign agent, they are still the only place where the system can be acted against or acted through.

Praise, blame, reward, and punishment are part of culture itself. They are some of the ways culture shapes behavior and keeps itself stable over time. In that sense, morality influences the expression of culture through people’s actions. Accountability is both a result of human behavior and one of its causes.

Economics

Individuals can resist instincts, norms, narratives, and incentives. But in aggregate and over time, such resistance is statistically rare and economically negligible. Novel actions by individuals only become historically important when they are taken up and propagated by the surrounding layers. Markets, institutions, and historical epochs are not shaped by uncaused heroic exceptions, but emerge over time through evolutionary processes, sometimes crystallizing around rare, high-impact individuals or tightly coordinated groups who act as leverage points in those processes.

This is why large-scale economic and social outcomes, while never perfectly predictable, are often structured, patterned, and partially forecastable. What we call “the economy” is not the result of millions of sovereign, isolated decisions, but the collective expression of shared pressures acting through millions of similar human beings embedded in similar environments.

Samo Burja’s idea of “live players” is useful here. He points out that most people and institutions mostly follow scripts, while a small number of individuals or groups are capable of genuinely novel action and can sometimes reshape institutions or change the course of events. Human systems give these live players a metaphysical grounding. They are a rare configuration where many layers align (knowledge, incentives, social position, institutional access, timing, and narrative) producing a new and powerful trajectory through the system. Great individuals matter, but they matter because of where they sit in the causal field, not because they stand outside it.

By this point, human systems has moved far beyond the framework of Human Action. The Austrian model of the cognitive actor, while rejecting naïve mechanical determinism, still treats the individual as the primary and irreducible unit of explanation, with shared patterns of valuation taken largely as given. But shared valuation is not a mystery. It is exactly what we should expect if individuals are expressions of shared biological, cultural, and institutional forces.

Friedrich Hayek came closer to this deeper view than most Austrians. In The Fatal Conceit (1988), he argued that cultural norms, traditions, and institutions evolve spontaneously through a process akin to selection, and that civilizations are shaped by rules and practices no single individual designed or even fully understands. In doing so, he implicitly treated culture as something evolution acts upon, not merely something individuals happen to carry in their heads.

However, Hayek never fully crossed the ontological line. Individuals remained, in his framework, the only true actors, with culture as an emergent but secondary phenomenon. Human systems simply finishes the thought Hayek began: culture is not just a product of individuals, individuals are also products of culture.

In the same way that a body is the phenotype of genetic evolution, an individual human being can be understood as part of the phenotype of a cultural and institutional system. Markets, then, are not aggregations of independent wills, but fields of coordinated behavior shaped by layered evolutionary pressures operating through human beings.

This is why economic history is not a random walk. Bubbles, panics, manias, booms, busts, and long cycles are not accidents, but the recurring results of layered human systems expressing themselves at scale in structured and often forecastable ways.

HODL strong. Thanks for being members!

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