IPFS News Link • General Opinion
What If Economists Applied Their Own Theories... To Themselves
• Zero HedgeThe Economics of Manipulation and Deception declares on its first page that people "do not do what is really good for them; they do not choose what they really want." It appears that a main preoccupation of economists – the self declared "behavioral economists" prominent among them – is to show how dumb people are as consumers and in assessing risks.
Drawn to logical conclusion, this implies that economists, advising benevolent dictators are the solution. If, indeed, people are often "irrationally exuberant," plain dumb, uninformed, unable to learn from mistakes, easily manipulated - all the things Akerlof and Shiller suggest - why have markets drawing on mazes of contracts to start with? The book implies that the writers know what's good for the "hoi-polloi" who suffers from temptations that these illustrious writers never succumb to and thus should advise governments (in a recent letter, Ralph Nader suggests that Mr. Akerlof should advise his wife – Ms. Yellen – about Federal Reserve policies).