4 ms·

The current hype of not treating people like rational actors - pop-science people citing Tversky and Kahenman, for example - is rooted in what is not controvers

The current hype of not treating people like rational actors - pop-science people citing Tversky and Kahenman, for example - is rooted in what is not controversial at all for anyone who truly grasped basic economics, so-called "behavioral economics." It is no surprise to any classical economist that actors do not always act rationally and the foundation of microeconomics is not built on the unstable platform of assuming that everyone IS rational; but rather that treating actors AS rational is a just and fair way to act while also removing sources of bias. It does not mean that rules on how to approach people should NOT be modified via analysis of behavior, but rather that a priori we should assume people act rationally in their own self-interest as a first principle and go from there, not assume that everyone is irrational and create a ten million line case/switch statement.

dragonwriter 10y ago
> It is no surprise to any classical economist that actors do not always act rationally and the foundation of microeconomics is not built on the unstable platform of assuming that everyone IS rational; but rather that treating actors AS rational is a just and fair way to act while also removing sources of bias. No, economics is a predictive social science, not a system of moral philosophy; the rational choice model has nothing to do with how it is just and fair to treat people. It was the dominant model because despite being self-evidently not fundamentally correct (it assumes a number of things, like perfect knowledge of future outcomes, that no one believes to be literally true or even plausible) it was believed to be an approximation that would predicted results better than any alternative model available at the time, in general and in a wide array of specific cases.
- icelancer 10y ago
  >economics is a predictive social science The entirety of it is not. Not by a long shot.
  - dragonwriter 10y ago
    The places where the rational choice model has been applied are, because it's a predictive model; to the extent that there may be things that are properly called "economics" that are not part of the predictive social science with that name, they are not relevant to why the rational choice model.has been used.
analog31 10y ago
Indeed, I consider people as rational actors, not because I believe it to be a tested hypothesis, but because it seems to be a workable rule of thumb for treating people with respect and avoiding bias. It's also been my experience that when I hear people talking about one another as irrational, it's never because they're trying to be more respectful, but is invariably in support of patronizing or manipulating people. Nobody has ever used an irrational actor hypothesis to justify paying someone more, or giving them more authority and autonomy.

dragonwriter 10y ago

> It is no surprise to any classical economist that actors do not always act rationally and the foundation of microeconomics is not built on the unstable platform of assuming that everyone IS rational; but rather that treating actors AS rational is a just and fair way to act while also removing sources of bias. No, economics is a predictive social science, not a system of moral philosophy; the rational choice model has nothing to do with how it is just and fair to treat people. It was the dominant model because despite being self-evidently not fundamentally correct (it assumes a number of things, like perfect knowledge of future outcomes, that no one believes to be literally true or even plausible) it was believed to be an approximation that would predicted results better than any alternative model available at the time, in general and in a wide array of specific cases.

icelancer 10y ago
>economics is a predictive social science The entirety of it is not. Not by a long shot.
- dragonwriter 10y ago
  The places where the rational choice model has been applied are, because it's a predictive model; to the extent that there may be things that are properly called "economics" that are not part of the predictive social science with that name, they are not relevant to why the rational choice model.has been used.

analog31 10y ago

Indeed, I consider people as rational actors, not because I believe it to be a tested hypothesis, but because it seems to be a workable rule of thumb for treating people with respect and avoiding bias. It's also been my experience that when I hear people talking about one another as irrational, it's never because they're trying to be more respectful, but is invariably in support of patronizing or manipulating people. Nobody has ever used an irrational actor hypothesis to justify paying someone more, or giving them more authority and autonomy.