To discuss: the pointlessness of behavioural economics as modified classical economics, when large data applications make this a predictive science
Our intro courses fail to reflect the dramatic advances in economics — concerning information problems and strategic interactions, for example — since Samuelson’s paradigm-setting 1948 textbook. Missing, too, is any sustained engagement with new problems we now confront and on which economics has important insights for public policy — climate change, innovation, instability and growing inequality amongst them. This column introduces a free online interactive text — now used as the standard intro at UCL, Sciences Po, and Toulouse School of Economics — which responds.
Collective behavioural economics
In financial markets we have some elegant models of collective human behaviour in, e.g. Black-Scholes formulae etc.
Things to think about here: Bounded rationality, rational inattention, institutions as stable orbits in behavioural systems, devious negotiation strategies …
See marketing psychology.
See the risk perception page.
Charness, Gary, and Matthias Sutter. 2012. “Groups Make Better Self-Interested Decisions.” Journal of Economic Perspectives 26 (3): 157–76. https://doi.org/10.1257/jep.26.3.157.
Hausman, Daniel M. 2011. “Mistakes About Preferences in the Social Sciences.” Philosophy of the Social Sciences 41 (1): 3–25. https://doi.org/10.1177/0048393110387885.
Peters, Ole. 2019. “The Ergodicity Problem in Economics.” Nature Physics 15 (12, 12): 1216–21. https://doi.org/10.1038/s41567-019-0732-0.
Roughgarden, Tim. 2018. “Complexity Theory, Game Theory, and Economics,” January. http://arxiv.org/abs/1801.00734.
Shalizi, Cosma Rohilla. 2009. “Dynamics of Bayesian Updating with Dependent Data and Misspecified Models.” Electronic Journal of Statistics 3: 1039–74. https://doi.org/10.1214/09-EJS485.
Sharpe, Keiran. 2015. “On the Ellsberg Paradox and Its Extension by Machina.” SSRN Scholarly Paper ID 2630471. Rochester, NY: Social Science Research Network. http://papers.ssrn.com/abstract=2630471.
Valentine, Melissa A, Daniela Retelny, Alexandra To, Negar Rahmati, Tulsee Doshi, and Michael S Bernstein. 2017. “Flash Organizations: Crowdsourcing Complex Work by Structuring Crowds as Organizations.” In Proceedings of the 2017 CHI Conference on Human Factors in Computing Systems, 3523–37. ACM. http://hci.stanford.edu/publications/2017/flashorgs/flash-orgs-chi-2017.pdf.