by John Nash on unsound game theory [embedded content] What John Nash (!) says underlines the very fundamental methodological weakness of game theory and neoclassical mainstream economics at large. Overemphasizing the reach of instrumental rationality and abstracting away from the influence of non-economic factors, reduces the analysis to a pure thought experiment without any substantial connection to reality. Limiting theoretical economic analysis in this way — not incorporating both motivational and institutional factors when trying to explain human behaviour — makes economics insensitive to social facts, and thus useless. Economic relations are always embedded in socio-cultural contexts. Not taking account of that, economics will never be able to
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John Nash on unsound game theory
What John Nash (!) says underlines the very fundamental methodological weakness of game theory and neoclassical mainstream economics at large. Overemphasizing the reach of instrumental rationality and abstracting away from the influence of non-economic factors, reduces the analysis to a pure thought experiment without any substantial connection to reality. Limiting theoretical economic analysis in this way — not incorporating both motivational and institutional factors when trying to explain human behaviour — makes economics insensitive to social facts, and thus useless.
Economic relations are always embedded in socio-cultural contexts. Not taking account of that, economics will never be able to come up with useful and relevant explanations.