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On April 11 2014 00:52 oneofthem wrote:
whitedog i agree that incentive talk can overreach but it is still an important mechanism (because it does constitute a part of human behavior). what specific bad incentive based arguments do you have in mind?
As someone smarter than me has said, "the basic problem is that 'incentives' is merely a metaphor, and as a metaphor to describe human creative activity it's pretty crummy. I have said this before, but the better metaphor arose on the day Michael Faraday first noticed what happened when he wrapped a coil of wire around a magnet and spun the magnet. Current flows in such a wire, but we don't ask what the incentive is for the electrons to leave home. We say that the current results from an emergent property of the system, which we call induction. The question we ask is 'what's the resistance of the wire?' So Moglen's Metaphorical Corollary to Faraday's Law says that if you wrap the Internet around every person on the planet and spin the planet, software flows in the network. It's an emergent property of connected human minds that they create things for one another's pleasure and to conquer their uneasy sense of being too alone."
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On April 11 2014 10:04 JonnyBNoHo wrote:Show nested quote +On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit.
I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer?
But I think it's reasonably clear I wasn't making the claim that 'Rationality is a myth'?
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On April 11 2014 10:34 GreenHorizons wrote:Show nested quote +On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'?
Lol, OK, you don't like how I phrased it?
Grow up.
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On April 11 2014 10:30 IgnE wrote:Show nested quote +On April 11 2014 00:52 oneofthem wrote:
whitedog i agree that incentive talk can overreach but it is still an important mechanism (because it does constitute a part of human behavior). what specific bad incentive based arguments do you have in mind? As someone smarter than me has said, "the basic problem is that 'incentives' is merely a metaphor, and as a metaphor to describe human creative activity it's pretty crummy. I have said this before, but the better metaphor arose on the day Michael Faraday first noticed what happened when he wrapped a coil of wire around a magnet and spun the magnet. Current flows in such a wire, but we don't ask what the incentive is for the electrons to leave home. We say that the current results from an emergent property of the system, which we call induction. The question we ask is 'what's the resistance of the wire?' So Moglen's Metaphorical Corollary to Faraday's Law says that if you wrap the Internet around every person on the planet and spin the planet, software flows in the network. It's an emergent property of connected human minds that they create things for one another's pleasure and to conquer their uneasy sense of being too alone."
You can add 'the profit motive' to the list of clumsy concepts/words in Neoclassical capitalism. Like I said though, I think there are reasonable people on both sides that could come up with quality compromises and concepts around economics if both sides didn't use ignorance and irrationality to artificially bolster their arguments.
If both sides came to the table sincerely intending to leave with at least a few solutions (not silver bullets) to some of the economic facing the US and the world at large I really believe that we could get some big things done.
The disheartening part is that I can only sincerely see one side doing that in the foreseeable future.
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On April 11 2014 10:45 JonnyBNoHo wrote:Show nested quote +On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up.
Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then?
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On April 11 2014 10:51 GreenHorizons wrote:Show nested quote +On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Show nested quote +Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then?
Just replace rationality with the rational myth you referenced.
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On April 11 2014 10:59 JonnyBNoHo wrote:Show nested quote +On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced.
To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you.
For clarification this is more or less what I was referring to.
"Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility."
Source
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On April 11 2014 11:11 GreenHorizons wrote:Show nested quote +On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source
Yeah that's what I figured you were referring to.
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Economic theories that are based on some pseudo-psychological analysis of the human behaviour is really troublesome to me. The focus should be on collecting data and evaluating it instead of creating some kind of theoretical human that doesn't even remotely come close to reality.
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On April 11 2014 11:20 JonnyBNoHo wrote:Show nested quote +On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to.
Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true".
And your 'clarification' is wholly inapplicable to the statement as worded?
Economic theories that are based on some pseudo-psychological analysis of the human behaviour is really troublesome to me. The focus should be on collecting data and evaluating it instead of creating some kind of theoretical human that doesn't even remotely come close to reality.
Seems kind of like a 'Duhhh' thing. We should at least look at the data before trying to ascribe human behavior to it instead of the Neoclassical idea of assuming human behavior then applying it to the data.
Seems like any intellectual integrity would lead you to that conclusion pretty quickly. But here we are...
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On April 11 2014 11:29 GreenHorizons wrote:Show nested quote +On April 11 2014 11:20 JonnyBNoHo wrote:On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:On April 11 2014 03:34 oneofthem wrote:
it's not complete nonsense at all. if it was complete nonsense the glorious soviet union would be a paradise 'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy. I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class. One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable. I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to. Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true". And your 'clarification' is wholly inapplicable to the statement as worded?
Like I said, I wasn't disagreeing with you so much as moderating your comment a bit. People do act rationally at times and rational assumptions can explain a lot of economic behavior. It's not something that holds true always though, and in that sense it is a myth.
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On April 11 2014 11:28 Nyxisto wrote:
Economic theories that are based on some pseudo-psychological analysis of the human behaviour is really troublesome to me. The focus should be on collecting data and evaluating it instead of creating some kind of theoretical human that doesn't even remotely come close to reality.
Sure, it's often hard to just go with the data though. As Krugman put it:
But you can’t be an effective fox just by letting the data speak for itself — because it never does. You use data to inform your analysis, you let it tell you that your pet hypothesis is wrong, but data are never a substitute for hard thinking. If you think the data are speaking for themselves, what you’re really doing is implicit theorizing, which is a really bad idea (because you can’t test your assumptions if you don’t even know what you’re assuming.)
Link (from a Noahpinion post on data vs theory)
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Cayman Islands24199 Posts
the rationality assumption is not taken to be literally empirically accurate by economists (most of them anyway besides some freshwater stuff). it's a simplifying tool used to math stuff up and get to phenomenon with a tractable model.
the soviet union example is w/e. but to deny incentive as an important part of how people behave is just as bad as taking it as everything.
i mainly used soviet union as an example of a system with a top down structure as opposed to a bottom up, emergent market ecosystem. it's totally correct to identify this particular feature of the soviet union as a primary cause wrt their lack of economic performance.
incentive itself is kind of transparent, a placeholder for all sorts of 'reasons driving autonomous agents to do stuff.' for a more productive udnerstanding of incentive in economics, it's not a thesis about what specific things people want, but one about agent based modeling and such, using individual motivation and behavior as starting point. point is people do stuff for their own reasons, and you can't ignore that in a social system, however topdown you'd like it to be.
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Cayman Islands24199 Posts
On April 11 2014 10:30 IgnE wrote:Show nested quote +On April 11 2014 00:52 oneofthem wrote:
whitedog i agree that incentive talk can overreach but it is still an important mechanism (because it does constitute a part of human behavior). what specific bad incentive based arguments do you have in mind? As someone smarter than me has said, "the basic problem is that 'incentives' is merely a metaphor, and as a metaphor to describe human creative activity it's pretty crummy. I have said this before, but the better metaphor arose on the day Michael Faraday first noticed what happened when he wrapped a coil of wire around a magnet and spun the magnet. Current flows in such a wire, but we don't ask what the incentive is for the electrons to leave home. We say that the current results from an emergent property of the system, which we call induction. The question we ask is 'what's the resistance of the wire?' So Moglen's Metaphorical Corollary to Faraday's Law says that if you wrap the Internet around every person on the planet and spin the planet, software flows in the network. It's an emergent property of connected human minds that they create things for one another's pleasure and to conquer their uneasy sense of being too alone."
it's this rationalistic, agent based way of looking at the economy. but the main problem is not about accuracy of incentives as inputs into your mdoel per se, but the simplistic agent interactions that ignore the complex interactions and stuff like political/social associative power.
a society is a network not 10 billion robinson crusoes on 10 billion islands
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On April 11 2014 11:39 JonnyBNoHo wrote:Show nested quote +On April 11 2014 11:29 GreenHorizons wrote:On April 11 2014 11:20 JonnyBNoHo wrote:On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:On April 11 2014 04:27 GreenHorizons wrote:
[quote]
'Incentive' is hardly even on the radar when it comes to the perils of the Soviet Union. Outside of the eastern bloc I don't think there are many if any people advocating for another 'Soviet Union'. Using the Soviet example to dispel leftleaning ideas would be like using Rome to deride democracy.
I think it was you that had a good point about neoclassical economics. Economists talk about it like it was science, but it wouldn't even past muster in a middle school science class.
One of the first assumptions most economists make is dead wrong. Then they build most of their reasoning off of that easily disproved premise. Some of their models may closely resemble some real world situations but it's so far from science the comparison is laughable.
I've asked several economists about the 'rational' myth and the liberals admit that it's a ridiculous notion (but it's neccessary to most of the work in economics so they don't bother challenging the mythos. The conservative 'Smith' types still hold onto it like a newborn baby pretty much refusing to admit the prima facie fact that the assumption is wrong. They even undermine REAL scientific studies on human behavior in order to maintain their 'rational' myth. But perhaps that is just my experience. If there are other 'Smith' type economists that admit the 'rational' myth is ridiculous I just haven't met any. Rationality isn't a myth, it just doesn't hold true always. There's a difference. Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to. Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true". And your 'clarification' is wholly inapplicable to the statement as worded? Like I said, I wasn't disagreeing with you so much as moderating your comment a bit. People do act rationally at times and rational assumptions can explain a lot of economic behavior. It's not something that holds true always though, and in that sense it is a myth.
'Rational assumptions' used in such a way, is more explanation through correlation than causation, as they are generally espoused.
Taking the time to formulate your opinion or 'moderating' in the way done here is what I have been requesting. I appreciate when you do it this way as opposed to your initial comment.
I think it is not helpful to perpetuate any unfounded validity in economic thought founded on such a fundamentally flawed assumption of 'always' behaving rationally. Further the proposition that replacing the word 'always' with some variation of 'mostly' solves anything worthwhile is inaccurate. Stretching it to rationalize current real-world economic situations is rarely if ever helpful even in many cases when you could say one of such models ''accurately' correlates to a real-world situation.
That's basically why I say the 'one-liner' distinction isn't really important, particularly when it's vague and the significance of the distinction unclear. Add on top of that you didn't really disagree with any of the actual substance of the claim, and perhaps you can see how your concern for the need of the distinction in the first place is becoming hard to envision as sincere?
But because this is not my first time talking to you I know better. So I thank you again for the more thought out version and I look forward to more of those and less of the one-liners? 
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Cayman Islands24199 Posts
unfounded validity in economic thought founded on such a fundamentally flawed assumption of 'always' behaving rationally
that's a misunderstanding. this is not the foundation of economics lol
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On April 11 2014 12:18 GreenHorizons wrote:Show nested quote +On April 11 2014 11:39 JonnyBNoHo wrote:On April 11 2014 11:29 GreenHorizons wrote:On April 11 2014 11:20 JonnyBNoHo wrote:On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:On April 11 2014 10:04 JonnyBNoHo wrote:
[quote]
Rationality isn't a myth, it just doesn't hold true always. There's a difference.
Edit: not really disagreeing with you, just reeling in your statement a bit. I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer? But I think it's reasonably clear I wasn't making the claim that ' Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to. Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true". And your 'clarification' is wholly inapplicable to the statement as worded? Like I said, I wasn't disagreeing with you so much as moderating your comment a bit. People do act rationally at times and rational assumptions can explain a lot of economic behavior. It's not something that holds true always though, and in that sense it is a myth. 'Rational assumptions' used in such a way, is more explanation through correlation than causation, as they are generally espoused. Taking the time to formulate your opinion or 'moderating' in the way done here is what I have been requesting. I appreciate when you do it this way as opposed to your initial comment. I think it is not helpful to perpetuate any unfounded validity in economic thought founded on such a fundamentally flawed assumption of 'always' behaving rationally. Further the proposition that replacing the word 'always' with some variation of 'mostly' solves anything worthwhile is inaccurate. Stretching it to rationalize current real-world economic situations is rarely if ever helpful even in many cases when you could say one of such models ''accurately' correlates to a real-world situation. That's basically why I say the 'one-liner' distinction isn't really important, particularly when it's vague and the significance of the distinction unclear. Add on top of that you didn't really disagree with any of the actual substance of the claim, and perhaps you can see how your concern for the need of the distinction in the first place is becoming hard to envision as sincere? But because this is not my first time talking to you I know better. So I thank you again for the more thought out version and I look forward to more of those and less of the one-liners?
Well, I prefer shorter posts and I'm not going to change the way I post because you don't like it, though I won't ignore your criticism either.
I still think your comments here are too critical. It's not really practical to model reality. You need to make assumptions and simplifications to get anywhere and assuming that people are rational has its place. The same can be said for the oft-hated efficient market hypothesis. It's not always an accurate depiction of reality, but you can still get a lot of useful mileage out of those theories and the models that work around them.
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On April 11 2014 13:02 JonnyBNoHo wrote:Show nested quote +On April 11 2014 12:18 GreenHorizons wrote:On April 11 2014 11:39 JonnyBNoHo wrote:On April 11 2014 11:29 GreenHorizons wrote:On April 11 2014 11:20 JonnyBNoHo wrote:On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:
[quote]
I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer?
But I think it's reasonably clear I wasn't making the claim that 'Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to. Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true". And your 'clarification' is wholly inapplicable to the statement as worded? Like I said, I wasn't disagreeing with you so much as moderating your comment a bit. People do act rationally at times and rational assumptions can explain a lot of economic behavior. It's not something that holds true always though, and in that sense it is a myth. 'Rational assumptions' used in such a way, is more explanation through correlation than causation, as they are generally espoused. Taking the time to formulate your opinion or 'moderating' in the way done here is what I have been requesting. I appreciate when you do it this way as opposed to your initial comment. I think it is not helpful to perpetuate any unfounded validity in economic thought founded on such a fundamentally flawed assumption of 'always' behaving rationally. Further the proposition that replacing the word 'always' with some variation of 'mostly' solves anything worthwhile is inaccurate. Stretching it to rationalize current real-world economic situations is rarely if ever helpful even in many cases when you could say one of such models ''accurately' correlates to a real-world situation. That's basically why I say the 'one-liner' distinction isn't really important, particularly when it's vague and the significance of the distinction unclear. Add on top of that you didn't really disagree with any of the actual substance of the claim, and perhaps you can see how your concern for the need of the distinction in the first place is becoming hard to envision as sincere? But because this is not my first time talking to you I know better. So I thank you again for the more thought out version and I look forward to more of those and less of the one-liners? Well, I prefer shorter posts and I'm not going to change the way I post because you don't like it, though I won't ignore your criticism either. I still think your comments here are too critical. It's not really practical to model reality. You need to make assumptions and simplifications to get anywhere and assuming that people are rational has its place. The same can be said for the oft-hated efficient market hypothesis. It's not always an accurate depiction of reality, but you can still get a lot of useful mileage out of those theories and the models that work around them.
Can you give us some examples of successful applications of such theories? Successful predictions?
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On April 11 2014 13:02 JonnyBNoHo wrote:Show nested quote +On April 11 2014 12:18 GreenHorizons wrote:On April 11 2014 11:39 JonnyBNoHo wrote:On April 11 2014 11:29 GreenHorizons wrote:On April 11 2014 11:20 JonnyBNoHo wrote:On April 11 2014 11:11 GreenHorizons wrote:On April 11 2014 10:59 JonnyBNoHo wrote:On April 11 2014 10:51 GreenHorizons wrote:On April 11 2014 10:45 JonnyBNoHo wrote:On April 11 2014 10:34 GreenHorizons wrote:
[quote]
I guess if someone was woefully uninformed about economics they might make an interpretation that would require such a disclaimer?
But I think it's reasonably clear I wasn't making the claim that 'Rationality is a myth'? Lol, OK, you don't like how I phrased it? Grow up. Rationality isn't a myth, it just doesn't hold true always. There's a difference.
What were you trying to say then? Just replace rationality with the rational myth you referenced. To avoid confusion I'll let you define which version of the 'rational myth' you wish to posit as non-mythical. Depending on the wording I might agree with you. For clarification this is more or less what I was referring to. "Neoclassical theory operates on a few basic assumptions–mainly that economic decisions are always made rationally based on fully informed evaluations of utility." Source Yeah that's what I figured you were referring to. Well then... I think I'm confused... That is a myth. "an idea or story that is believed by many people but that is not true". And your 'clarification' is wholly inapplicable to the statement as worded? Like I said, I wasn't disagreeing with you so much as moderating your comment a bit. People do act rationally at times and rational assumptions can explain a lot of economic behavior. It's not something that holds true always though, and in that sense it is a myth. 'Rational assumptions' used in such a way, is more explanation through correlation than causation, as they are generally espoused. Taking the time to formulate your opinion or 'moderating' in the way done here is what I have been requesting. I appreciate when you do it this way as opposed to your initial comment. I think it is not helpful to perpetuate any unfounded validity in economic thought founded on such a fundamentally flawed assumption of 'always' behaving rationally. Further the proposition that replacing the word 'always' with some variation of 'mostly' solves anything worthwhile is inaccurate. Stretching it to rationalize current real-world economic situations is rarely if ever helpful even in many cases when you could say one of such models ''accurately' correlates to a real-world situation. That's basically why I say the 'one-liner' distinction isn't really important, particularly when it's vague and the significance of the distinction unclear. Add on top of that you didn't really disagree with any of the actual substance of the claim, and perhaps you can see how your concern for the need of the distinction in the first place is becoming hard to envision as sincere? But because this is not my first time talking to you I know better. So I thank you again for the more thought out version and I look forward to more of those and less of the one-liners? Well, I prefer shorter posts and I'm not going to change the way I post because you don't like it, though I won't ignore your criticism either. I still think your comments here are too critical. It's not really practical to model reality. You need to make assumptions and simplifications to get anywhere and assuming that people are rational has its place. The same can be said for the oft-hated efficient market hypothesis. It's not always an accurate depiction of reality, but you can still get a lot of useful mileage out of those theories and the models that work around them.
I wouldn't expect you to. Just making what you are saying more clear. It helps further the discussion and is more in line with the thread guidelines and such. I appreciate the consideration.
I don't have a problem with assumptions as you have described them, sans the neoclassical part.
For instance 'predictable irrationality' is much more sensible and more strongly supported by the empirical evidence(even if it suffers some of the same problems).
Forgive the crudeness of the analogy but you 'can use a screwdriver as a hammer, doesn't make it a good idea'
In the larger discussion, while I agree there is some nuance in those models that may be of value, the negative consequences of substantiating the agreed upon errant portion by oversimplifying the 'valid' portion (I suggest) is more destructive than constructive, to both the debate and the economy.
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EPT
