When I was in school, I was the “class brain.”? (sigh, I had a hard time with it, but after I became a Christian, I won people over by offering homework help for free) I even have this glow-in-the-dark rubber brain that my senior class awarded me.
But it’s not worth that much.? There are many other character attributes desirable to society aside from being smart.? As a little kid, I was a guinea pig for many of the educational theories they tried to test on me, and I survived them.? Not sure what good they got out of it.
In my adulthood, I learned to appreciate the abilities of others who may be less smart, but they have gifts — empathy, mechanic, insightful into people, technical specialties… everyone has something to give, IF they will give.
Economists have a fixation on rationality, and this article is a partial expression of that.? My answer to the article is the people are limitedly rational.? That’s vague, and won’t fit into mathematical theories, but it is accurate.? It explains why people act rationally in some situations, and why they could be more rational in other situations, assuming that economists really know what is rational.? More goods is better is not an adequate explanation of rational.
A view like mine would make it very difficult for economists to create simple mathematical models of reality.? They would rather live in their fake world, where they can publish nonsense to peers, and keep their cushy jobs.
David:
This is “bounded rationality,” a fairly well-known phenomenon in behavioral economics. I think a lot of things in life are “bounded.” The latest of fundamental indexation is “bounded” fundamentals, where the indices are cap-weighted until they get to some (arbitrary, but real) bounded limit where the fundamentals take over. Taleb’s “fat-tails” are another example of “boundedness” in which statistical normalcy works until it doesn’t–that is, until the pro-cyclical herd starts driving over the cliff, as in 1987 and 2008.
But you definitely have one thing right–there are lots of different kinds of intelligences–intellectual, emotional, physical, common-sensical. Thanks for the post.
Thanks, Doug. Yes, I am familiar with the term, and it expresses what I wanted to say, but could not remember it at the time. Still, I remember my microeconomics professors hating the concept, because it destroyed their modeling.
It doesn’t mean their models don’t work. It means they work until they don’t. That’s only a problem for an economic fundamentalist. A pragmatic practitioner who is driven by result–would that be an evangelist?–should welcome the idea of boundedness. Aristotle in action.
The math falls apart if people don’t optimize, because then one doesn’t have a formula that you can maximize or minimize. Human behavior is complex, and when neoclassical microeconomics gets tested, many of its testable hypotheses get rejected because people don’t optimize. The simple supply and demand curves are nice theoretical constructs that don’t work in practice.
Naw, they work. Until they don’t. It’s not that the math doesn’t work–but it’s too simple. And the “bounds” can be modeled in aggregate, but they don’t work in micro.
I think people optimize. I’d stop on the street to pick up a $20 bill–but I live in New Hampshire, not NYC. The boundedness for the pick-up-a-$10 bill function is a function of the probability of mortality. Maybe in NYC it would have to be a gold ingot.
A Christian arguing against rationality: there’s a surprise.
Reminds me of a sign I saw once at our local Church of Christ: “Reason is the enemy of faith”.
Faith allows us to invent any truth we want. Unfortunately, the world operates on the principle of actual truth, not invented truth.
The more we listen to rational people, and the less we listen to Christians, the better.
Yes, it was Tertullian who asked, “What has Jerusalem to do with Athens?” The answer that Augustine and Thomas gave was, a lot. Do you *really* believe that people are perfectly rational?
To put it another way, “What is truth?” Tversky showed that framing matters: identical choices will result in different outcomes when presented differently. Would you rather opt for a surgery with a 70% success rate or a 30% chance of death?
I don’t know if Tversky was a Christian. Does that matter?
EconomistDelNorte,
I can understand how you would say that if you’ve been around some circles of Christianity. I think some of us have held onto an Enlightenment idea that it’s a good thing to separate faith and reason.
On the other hand, you have Christians like David who are closer to the theology of the Reformers. You’ll often find people in this circle seriously discussing their faith and using evidence and logical argumentation.
I don’t want to speak for David, but my guess is that he believes people are messed up but capable of redemption. It’s unrealistic to treat people as if they’re perfect, but it’s also untrue to say reason is a bad thing or that people have no ability to reason correctly at all.