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I think you're missing the point re: Blyth's comment. (I probably should have explained more about my reason for in for including it) It doesn't matter if a th
by pdkl95 11y ago
I think you're missing the point re: Blyth's comment. (I probably should have explained more about my reason for in for including it)
It doesn't matter if a theory is correct when "nobody knows what that sentence means!"
Blyth isn't dismissing the concept of time inconsistency - he's pointing out that models that rely on people making "rational" decisions are total junk if nobody actually understands the required concepts. Models that assume people would change their behavior because of time inconsistency should never have been considered in the first place because most people don't know what the term even means.
In a similar manner, I'm suggesting that while it would be nice if we could set up "markets" that self correct or allow problems to be handled locally, this might not be possible in practice.
- vezzy-fnord 11y agoOh, a basic criticism of modeling assumptions is orderly. Though, your particular example of people not changing their behavior because they're unfamiliar with a specific terminology is absolutely baffling. The phenomenon exists regardless of whether people are familiar with the lexicon. Whether or not it's possible to set up markets that self-correct is a different matter. They already do to various degrees even in current hampered regimes, modulo business cycles. Though, we must extend the same skepticism towards state attempts at equilibration if we are to be consistent. But far too much doubt becomes an analytical nihilism.