Brad De Long wrote:
> Well, just to take the things Matt Rabin has written recently that
> are on my desk...
(snip)
>
>
> "Psychology and Economics"
>
> Because psychology systematically explores human judgment, behavior,
> and well- being, it can teach us important facts about how humans
> differ from traditional economic assumptions. In this essay I discuss
> a selection of psychological findings relevant to economics. Standard
> economics assumes that each person has stable, well-defined
> preferences, and that she rationally maximizes those preferences.
> Section 2 considers what psychological research teaches us about the
> true form of preferences, allowing us to make economics more
> realistic within the rational-choice framework.
snip
>
>
> Brad DeLong
It seems to me that "standard economics" assumes that individual
preferences are just that -- not influenced by what others are doing,
and further assumes that preferences are fully reversible in time.
Without those assumptions NC economics stands in thin air. In other
words, close all the econ departments. Duesenberry blew this nonsense
away fifty years ago, followed by many others, notably Robin Marris.
But even when distinguished economists inside NC economics show that it
is nonsense, nothing changes.
Gene Coyle
