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Careful, as that can be a slippery slope: that exact expression, “financial literacy”, has been used in Europe as a way to push ideology - all economy is politi

Careful, as that can be a slippery slope: that exact expression, “financial literacy”, has been used in Europe as a way to push ideology - all economy is political. Will they teach the fallacy that economic agents make rational choices? Will they teach the fallacy that running a country is the same as running a household or a grocery store (in terms of supposed thrift)? Will they teach that market growth guaranteedly means improved living standards for all? Will they overwhelm students with technical jargon to make contestable theories seem irrefutable? Will they present market dynamics as "natural laws" rather than human constructions? Will they teach that widespread economic practices must be correct simply because they're common? Will they equate market freedom with political freedom as if they're the same thing? Finally, will they teach Keynesian Economics or Neoliberal Economics? Furthermore, will they teach austerity is mathematically self-defeating and in 95% of cases, will fail?

trod1234 2y ago
> Finally, will they teach Keynesian Economics, or Neoliberal Economics? What about Classical or Austrian?
NlightNFotis 2y ago
Jesus Christ mate, they're talking about personal finance, not political economy.
- DrNosferatu 2y ago
  Basic personal finance, like interest rates, simple statistics (namely about casinos), sure. BUT, during the European austerity footgun days, they put an animated talking bear on tv teaching this “financial literacy” and illustrating the “run your country as a thrifty household” tale as meritorious and not a fallacy, among other stuff like that.
  - alabastervlog 2y ago
    Talk to some political scientists. You're never getting a polity that understands the issues and votes largely based on policy. Won't happen, not even remotely close. They'll always be voting on forehead-slappingly dumb shit like "running government like a business is a good idea", or more likely on a dozen extremely stupid misconceptions at once, plus just "do I perceive that bad things are happening, generally, regardless of whether they have anything to do with the office I'm voting for".
  - mcny 2y ago
    I saw this YouTube video recently that said there are four main categories to spending money: A. Your own money A1. On yourself A2. On others (not necessarily the same others) B. Other people's money B1. On you B2. On others (not necessarily the same others) It is kind of a wordy way to describe the principal agent problem. Problem is that we can't really wrap our heads around large numbers. I get overwhelmed just thinking about how the relatively small town I live in manages its finances. I don't think I have the mental model to fit how the US economy functions much less how it should function.
- vasco 2y ago
  I've seen that point made before. In Portugal for example the left wing parties are openly against financial literacy in schools exactly because they say it is political. I get the point, if you're a socialist or a communist, having everyone participating in the stock market puts your goal further away. They also have an argument that financial literacy is correlated with losing money on the stock market. In general I don't think it's that separate of an issue, even though I'm not as left.
  - DrNosferatu 2y ago
    It seems you have studied that exact tv talking bear’s lesson very well :D
    - vasco 2y ago
      I didn't get the reference unfortunately.
      - DrNosferatu 2y ago
        Unfortunately. May I recommend a book by an Economics Nobel Prize winner? Here: "Arguing with Zombies: Economics, Politics, and the Fight for a Better Future" by Paul Krugman (2020) And maybe even better: "Austerity: The History of a Dangerous Idea" by Mark Blyth - 2013
        vasco 2y ago
        I'm not sure I get your point still, I was merely describing the arguments of one side of the aisle of my country, did it give you the impression I'm somehow pro austerity? I'm not sure how you made that jump. And you still didn't explain the bear reference. Descriptive comments aren't endorsing something. Recommending two books to someone that asks you to explain a short expression is a bit rich though. Good luck with that.
        DrNosferatu 2y ago
- cocoto 2y ago
  It is political of course, because the left would like to provide to the financially illiterates, such that they don’t have to manage their own money. If everyone is saving/investing, the socialist system is mostly redundant (except for the extremely poor, non-working, ill or disabled people).
  - DrNosferatu 2y ago
    Sure: poor people are usually guilty of being poor. Nice thinking ;)
hiAndrewQuinn 2y ago
>Will they teach the fallacy that economic agents make rational choices? The alternative ideology (ies?) you sound like you're proposing assumes that economic agents do not make rational choices, or at least they don't on average. But if that were true we would all be better off making as few choices as possible, because most possible exchanges are not beneficial to both parties. I just don't see evidence for that at all.
- DrNosferatu 2y ago
  There are several books with the word “Zombie” on the title that can specifically teach you exactly about that! Some of them actually authored by Economics Nobel Prize winners ;) Here: "Arguing with Zombies: Economics, Politics, and the Fight for a Better Future" by Paul Krugman (2020) "Zombie Economics: How Dead Ideas Still Walk Among Us" by John Quiggin (2010) Bonus: "Predictably Irrational" by Dan Ariely - 2008 "The Myth of the Rational Market" by Justin Fox - 2009 "The Black Swan" by Nassim Nicholas Taleb - 2007
  - hiAndrewQuinn 2y ago
    This is a motte and bailey. Your original claim is "[individual] economic agents do not act rationally" (either at all, or on average, take your pick, both are pretty out there). When challenged, you retreat to "No no I don't mean like you and me economic agents. Obviously when I buy eggs from the supermarket it's probably because I wanted eggs more than the $x I paid for them, and not because I picked some random thing to buy for no reason. I'm really talking about" + insert some more complicated idea X from one of the books you mentioned. There are many such X you could choose from. That's why folks like you like to recommend entire books instead of giving a plain argument - so long as even one askance X seems to resonate with your audience, you can latch onto it and use it to emotionally persuade them. That is if anyone even bothers to read the book in the first place.
    - DrNosferatu 2y ago
      2. In other words, your answer misses the mark. When economists talk about economic agents not acting rationally, they’re not claiming people make completely random decisions devoid of reason. They’re pointing out that real human behavior consistently deviates from the idealized "rational actor" model in predictable ways. People exhibit cognitive biases, use mental shortcuts, are influenced by emotions, have inconsistent time preferences, and often lack complete information. These aren't rare exceptions - they're fundamental patterns documented in decades of behavioral economics research. Hence the books. This isn't a retreat to a more complicated position - it's simply acknowledging that the simplified models have practical limitations, AND, benefit some people far more than others. The evidence for these failures is robust enough that even mainstream economics has incorporated behavioral insights. Rather than hiding behind book recommendations, I'm happy to discuss specific examples of these systematic deviations from rationality if you're genuinely interested in the substance of the argument.

trod1234 2y ago

> Finally, will they teach Keynesian Economics, or Neoliberal Economics? What about Classical or Austrian?

NlightNFotis 2y ago

Jesus Christ mate, they're talking about personal finance, not political economy.

DrNosferatu 2y ago
Basic personal finance, like interest rates, simple statistics (namely about casinos), sure. BUT, during the European austerity footgun days, they put an animated talking bear on tv teaching this “financial literacy” and illustrating the “run your country as a thrifty household” tale as meritorious and not a fallacy, among other stuff like that.
- alabastervlog 2y ago
  Talk to some political scientists. You're never getting a polity that understands the issues and votes largely based on policy. Won't happen, not even remotely close. They'll always be voting on forehead-slappingly dumb shit like "running government like a business is a good idea", or more likely on a dozen extremely stupid misconceptions at once, plus just "do I perceive that bad things are happening, generally, regardless of whether they have anything to do with the office I'm voting for".
- mcny 2y ago
  I saw this YouTube video recently that said there are four main categories to spending money: A. Your own money A1. On yourself A2. On others (not necessarily the same others) B. Other people's money B1. On you B2. On others (not necessarily the same others) It is kind of a wordy way to describe the principal agent problem. Problem is that we can't really wrap our heads around large numbers. I get overwhelmed just thinking about how the relatively small town I live in manages its finances. I don't think I have the mental model to fit how the US economy functions much less how it should function.
vasco 2y ago
I've seen that point made before. In Portugal for example the left wing parties are openly against financial literacy in schools exactly because they say it is political. I get the point, if you're a socialist or a communist, having everyone participating in the stock market puts your goal further away. They also have an argument that financial literacy is correlated with losing money on the stock market. In general I don't think it's that separate of an issue, even though I'm not as left.
- DrNosferatu 2y ago
  It seems you have studied that exact tv talking bear’s lesson very well :D
  - vasco 2y ago
    I didn't get the reference unfortunately.
    - DrNosferatu 2y ago
      Unfortunately. May I recommend a book by an Economics Nobel Prize winner? Here: "Arguing with Zombies: Economics, Politics, and the Fight for a Better Future" by Paul Krugman (2020) And maybe even better: "Austerity: The History of a Dangerous Idea" by Mark Blyth - 2013
      - vasco 2y ago
        I'm not sure I get your point still, I was merely describing the arguments of one side of the aisle of my country, did it give you the impression I'm somehow pro austerity? I'm not sure how you made that jump. And you still didn't explain the bear reference. Descriptive comments aren't endorsing something. Recommending two books to someone that asks you to explain a short expression is a bit rich though. Good luck with that.
        DrNosferatu 2y ago
cocoto 2y ago
It is political of course, because the left would like to provide to the financially illiterates, such that they don’t have to manage their own money. If everyone is saving/investing, the socialist system is mostly redundant (except for the extremely poor, non-working, ill or disabled people).
- DrNosferatu 2y ago
  Sure: poor people are usually guilty of being poor. Nice thinking ;)

hiAndrewQuinn 2y ago

>Will they teach the fallacy that economic agents make rational choices? The alternative ideology (ies?) you sound like you're proposing assumes that economic agents do not make rational choices, or at least they don't on average. But if that were true we would all be better off making as few choices as possible, because most possible exchanges are not beneficial to both parties. I just don't see evidence for that at all.

DrNosferatu 2y ago
There are several books with the word “Zombie” on the title that can specifically teach you exactly about that! Some of them actually authored by Economics Nobel Prize winners ;) Here: "Arguing with Zombies: Economics, Politics, and the Fight for a Better Future" by Paul Krugman (2020) "Zombie Economics: How Dead Ideas Still Walk Among Us" by John Quiggin (2010) Bonus: "Predictably Irrational" by Dan Ariely - 2008 "The Myth of the Rational Market" by Justin Fox - 2009 "The Black Swan" by Nassim Nicholas Taleb - 2007
- hiAndrewQuinn 2y ago
  This is a motte and bailey. Your original claim is "[individual] economic agents do not act rationally" (either at all, or on average, take your pick, both are pretty out there). When challenged, you retreat to "No no I don't mean like you and me economic agents. Obviously when I buy eggs from the supermarket it's probably because I wanted eggs more than the $x I paid for them, and not because I picked some random thing to buy for no reason. I'm really talking about" + insert some more complicated idea X from one of the books you mentioned. There are many such X you could choose from. That's why folks like you like to recommend entire books instead of giving a plain argument - so long as even one askance X seems to resonate with your audience, you can latch onto it and use it to emotionally persuade them. That is if anyone even bothers to read the book in the first place.
  - DrNosferatu 2y ago
    2. In other words, your answer misses the mark. When economists talk about economic agents not acting rationally, they’re not claiming people make completely random decisions devoid of reason. They’re pointing out that real human behavior consistently deviates from the idealized "rational actor" model in predictable ways. People exhibit cognitive biases, use mental shortcuts, are influenced by emotions, have inconsistent time preferences, and often lack complete information. These aren't rare exceptions - they're fundamental patterns documented in decades of behavioral economics research. Hence the books. This isn't a retreat to a more complicated position - it's simply acknowledging that the simplified models have practical limitations, AND, benefit some people far more than others. The evidence for these failures is robust enough that even mainstream economics has incorporated behavioral insights. Rather than hiding behind book recommendations, I'm happy to discuss specific examples of these systematic deviations from rationality if you're genuinely interested in the substance of the argument.