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Is Homo Economicus a Psychopath?

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Re: Is Homo Economicus a Psychopath?

#21

Post by rayiner »

glenra wrote: post #5

A better question might be "Is Homo Economicus a Strawman?" To which the answer is: yes, it is. Classical economics does not actually assert that individual humans behave in a purely rational and fully-informed manner. A more accurate premise is that groups of humans tend on average to act at least somewhat as if they were rationally well-informed. We have tools to determine what "rational" behavior might look like a…

> A more accurate premise is that groups of humans tend on average to act at least somewhat as if they were rationally well-informed.

That's a wigglier definition of "rational actor" than neoclassical economics actually admits.

More precisely, neoclassical economics posits that economic equilibriums are the same as they would be if humans were rational actors. Random irrationality doesn't affect the equilibrium, but systematic irrationality certainly does.

Showing that people are systematically irrational about many things, as for example the work of behavioral economists does, certainly is not an unjustified attack on neoclassical economics.

Re: Is Homo Economicus a Psychopath?

#22

Post by AnimalMuppet »

jerf wrote: post #18
AnimalMuppet wrote: post #16

Earlier quoted context omitted.

> You can not understand the anger about HE until you understand that Marxists desperately need humans to not behave "slightly irrationally under some circumstances" (the real scenario) but need humans to be profoundly irrational, so they can justify their handing over all sorts of power to the government so they can save everyone from themselves. You had me until that sentence. I don't think the Marxists need humans…

Permitting large-scale "exploitation" requires large-scale irrationality, wouldn't you think? It's not rational to be exploited, and it's really not rational to be in an exploited minority. One of the reasons the Marxists see this is that they see a trade in which one side benefits "more" than the other according to one scale, and scream "exploitation!" But... it's still a trade that benefited both sides. It may inde…

> Permitting large-scale "exploitation" requires large-scale irrationality, wouldn't you think? It's not rational to be exploited...

That assumes that you have a better alternative. My alternative to being exploited by the greedy capitalists is revolution, but for that to work, a bunch of my fellow oppressed have to agree. My decision is (normally) whether to hopelessly revolt and get crushed, or to make the best of it and go along. In that context, going along is probably a rational choice.

> ... and it's really not rational to be in an exploited minority.

Marxism says that the exploited are the majority, not the minority.

Look, I'm not an apologist for Marxism. I don't want a Marxist revolution, and I don't want to live in the aftermath of one. But I think you're a bit mis-characterizing their position. (Once you characterize it accurately, then disagree as much and as eloquently as you please.)

Re: Is Homo Economicus a Psychopath?

#23

Post by vorg »

> about 7% of people were consistent HEs, never endowing their partners with any coin. They discovered that another 9% were quasi-HE (or qHE), giving their partners money a small proportion of the time. About a quarter of people consistently gave them a hefty chunk of change. These people were called Consistent Cooperators or CCs. And everyone else was in the middle, so the researchers called them Ordinary People (or ORDs)

According to another notation out there...

* the 16% HE+qHE's are called "Sociopaths"

* the 60% ORD's care called "Clueless"

* the 25% CC's are called "Losers"

Re: Is Homo Economicus a Psychopath?

#24

Post by TheOtherHobbes »

enoch_r wrote: post #10
ddebernardy wrote: post #7

Earlier quoted context omitted.

> A better question might be "Is Homo Economicus a Strawman?" > To which the answer is: yes, it is. Classical economics does not actually assert that individual humans behave in a purely rational and fully-informed manner. (Actually, classical economics does, in the sense that markets follow a price-demand curve rather than a wiggle as seen experimentally.) Worst yet, though: it's sheer lunacy. In the words of Steve…

You're responding to the claim that "classical economics does not actually assert that individual humans behave in a purely rational and fully-informed manner" with an argument that it is impossible for individual humans to behave in a purely rational and fully-informed manner. The only part of your comment that addresses the actual point of disagreement is "(Actually, classical economics does.)" As an aside, Keen's…

>"Rationality" does not require that one must perform a search through every possible permutation of items.

And yet you - or someone, inevitably - is also going to claim that markets are somehow magically "efficient" precisely because they're capable of usefully approximating exactly this kind of optimisation.

So which is it? Is "market efficiency" rational or not?

As for the original claim - of course it's true. Any sane study of the financial industry should make it obvious that the last people you want to manage anything are those who are motivated primarily by profit - precisely because they inevitably lack empathy and awareness of the social costs of their "rational" decisions.

Re: Is Homo Economicus a Psychopath?

#26

Post by Umn55 »

jerf wrote: post #15
gordaco wrote: post #8

My biggest gripe about the concept of Homo Economicus is the huge ideological component that often gets ignored. The article mentions it, but doesn't focus on it. An ideal HE behaves rationally, yes, but that doesn't tell the whole picture; being rational is about discussing with oneself all the possible behaviours, choosing the one that gives him the outcome closest to his desires. But also, and this is very importa…

You've touched on the strawman about HE, but you've misidentified the source. It is the Marxists that want you to believe the psychopath claim, in their desire to stereotype capitalism as blind greed. Good capitalists that understand economics will perfectly happily include happiness and such in the value functions they use, because it turns out economic theory stops functioning without that assumption; it's built in…

"It is the Marxists that want you to believe the psychopath claim, in their desire to stereotype capitalism as blind greed."

Oh but they have more then abundant evidence that capitalism was brought into being by war an conquest, not because it's some law of nature.

http://www.authorstream.com/Presentation/jferguson-1039684-c...

Albert einstein:

"The conquering peoples established themselves, legally and economically, as the privileged class of the conquered country. They seized for themselves a monopoly of the land ownership and appointed a priesthood from among their own ranks. The priests, in control of education, made the class division of society into a permanent institution and created a system of values by which the people were thenceforth, to a large extent unconsciously, guided in their social behavior.

But historic tradition is, so to speak, of yesterday; nowhere have we really overcome what Thorstein Veblen called “the predatory phase” of human development. The observable economic facts belong to that phase and even such laws as we can derive from them are not applicable to other phases. Since the real purpose of socialism is precisely to overcome and advance beyond the predatory phase of human development, economic science in its present state can throw little light on the socialist society of the future."

http://monthlyreview.org/2009/05/01/why-socialism/

Re: Is Homo Economicus a Psychopath?

#27

Post by michas »

AnimalMuppet wrote: post #22
jerf wrote: post #18

Earlier quoted context omitted.

Permitting large-scale "exploitation" requires large-scale irrationality, wouldn't you think? It's not rational to be exploited, and it's really not rational to be in an exploited minority. One of the reasons the Marxists see this is that they see a trade in which one side benefits "more" than the other according to one scale, and scream "exploitation!" But... it's still a trade that benefited both sides. It may inde…

> Permitting large-scale "exploitation" requires large-scale irrationality, wouldn't you think? It's not rational to be exploited... That assumes that you have a better alternative. My alternative to being exploited by the greedy capitalists is revolution, but for that to work, a bunch of my fellow oppressed have to agree. My decision is (normally) whether to hopelessly revolt and get crushed, or to make the best of…

> My alternative to being exploited by the greedy capitalists is revolution, but for that to work, a bunch of my fellow oppressed have to agree.

And that's exactly what happened in our history, and that revolution was the Marxism itself :)

Re: Is Homo Economicus a Psychopath?

#29

Post by ruskerdax »

Umn55 wrote: post #26
jerf wrote: post #15

Earlier quoted context omitted.

You've touched on the strawman about HE, but you've misidentified the source. It is the Marxists that want you to believe the psychopath claim, in their desire to stereotype capitalism as blind greed. Good capitalists that understand economics will perfectly happily include happiness and such in the value functions they use, because it turns out economic theory stops functioning without that assumption; it's built in…

"It is the Marxists that want you to believe the psychopath claim, in their desire to stereotype capitalism as blind greed." Oh but they have more then abundant evidence that capitalism was brought into being by war an conquest, not because it's some law of nature. http://www.authorstream.com/Presentation/jferguson-1039684-c... Albert einstein: "The conquering peoples established themselves, legally and economically,…

Marxists have all the evidence that Capitalism is brought into being by war and conquest, standing in stark contrast to every peaceful Marxist revolution that ended with such great results. If only Capitalists were as enlightened as Einstein, the highly regarded economist and anthropologist, who identified Capitalists as some primitive, predatory animal, we could finally evolve to see the socialist society of the future.
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