Re:What is money, anyway?
by JumpCrisscross on Monday March 28, 2022 @10:04AM
(#30830579)
> consider how much economic work is still based on the utterly flawed concept that humans are rational in a classical sense
It is not. In its descriptive mode, economics captures animal spirits well. In its prescriptive mode, yes, this is assumed. But rationality is a simplifying assumption, with work then done to explain why the reality observed in the descriptive mode diverges from the predicted behaviour of rational actors. Put another way, the rationality assumption is part spherical cow, part “what would we do were we rational?”
Rejecting modern economics for the rationality assumption is rejecting modern physics for its use of frictionless environments.
One thing about Marx is that he is as much history lesson as current economics lesson. Not that he, or other economists (the stuff from Mill I read is quite interesting, his "On Liberty" is great IMHO), are somehow fundamentally wrong today. They do have to be adapted for the last 100+ years so.
That may well be true. But I'm not convinced that modern economists are doing any better. For example, consider how much economic work is still based on the utterly flawed concept that humans are rational in a classical sense.