by Summary:
Behavioral economics vindicated. This 1979 Kahneman-Tversky study and its contemporary replication is about loss aversion. There are many, many more cognitive-affective biases affecting rationality. There is also illogic, since most people are not trained in either critical thinking or rigorous scientific method, and mathematical innumeracy is high, especially when the long term is included, as it is in many economists' assumptions about rationality and maximization. Then there is connotation of terms in addition to denotation, where the connotation carries an emotional charge. Persuasion — real advertising, PR and propaganda — are based on this. People also often choose and act against their own assumed "better" interests eg., economic interests, since interest is determined by
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Mike Norman considers the following as important:
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Behavioral economics vindicated. This 1979 Kahneman-Tversky study and its contemporary replication is about loss aversion. There are many, many more cognitive-affective biases affecting rationality. There is also illogic, since most people are not trained in either critical thinking or rigorous scientific method, and mathematical innumeracy is high, especially when the long term is included, as it is in many economists' assumptions about rationality and maximization. Then there is connotation of terms in addition to denotation, where the connotation carries an emotional charge. Persuasion — real advertising, PR and propaganda — are based on this. People also often choose and act against their own assumed "better" interests eg., economic interests, since interest is determined by
Topics:
Mike Norman considers the following as important:
This could be interesting, too:
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Behavioral economics vindicated.
Then there is connotation of terms in addition to denotation, where the connotation carries an emotional charge. Persuasion — real advertising, PR and propaganda — are based on this.
People also often choose and act against their own assumed "better" interests eg., economic interests, since interest is determined by values and people often hold a value system that subordinates one set of interests, e.g., economic, to another, e.g., social, political, cultural or religious.
The assumption that humans are "rational agents" in the sense that economists understand the term, which focuses exclusively on economic interest, is not a truism as supposed. The evidence shows this.
Ars Technica
The science behind human irrationality just passed a huge test
Cathleen O'Grady
The science behind human irrationality just passed a huge test
Cathleen O'Grady
Related
Fuzzy logic and fuzzy sets address this issue.
Statistical Modeling, Causal Inference, and Social Science
“Banishing ‘Black/White Thinking’: A Trio of Teaching Tricks”
Andrew Gelman | Professor of Statistics and Political Science and Director of the Applied Statistics Center, Columbia University
See also
Evonomics
Evidence for Tribalism in Economics
Blair Fix /