An Expert Dealing in Markets Concludes
Bob Wilson, a retired Wealth Manager, on Seeking Alpha writes on “Bell Curves, Black Swans And Sell Discipline" HERE
“Economists say that people generally act to minimize their expense and maximize their income. Behavioral economists say that this old mantra about the "invisible hand" has lots of exceptions because people's emotions or values interfere with "rational" choices. Let's call that asymmetry No. 2: our choices can be financially "irrational".”
That’s so true. Put humans back into political economy, and the maximize utility (“Max U”, Deirdre McCloskey) model no longer works.
Use Max U models, perhaps, to teach students how to think with a degree of rigour – and examine them as a selection device – but do not base policy recommendations, or make predictions, on them!