By: Ryan

Ryan — Tue, 07 Apr 2009 02:09:09 +0000

Hmmm. Behavioral theories based on small scale studies and psychological principles vs economic theories based on mathematical models scribbled out on chalkboards at the University of Chicago. Frankly I’m not seeing how one is more empirical than the other.
At least the theories of behavioral economists as presented in this article could be subjected to moderate scale, short term testing. Traditional economic theories are not testable except over the very long term and still decades of data have brought essentially no consensus about what does or does not work on a national level. When you add onto that the fact that each year brings challenges that have not been factored into previous economic models it seems to me that Economics may be a hard science when analyzing the past, but has never been and could never be a hard empirical science when predicting the future no matter what style you choose.
Especially in our current economic crisis, our problems are so new that it seems like any economic path we choose will simply be chosen based on the best guesses of academics. So frankly, the ideas of these behavioral economists don’t seem especially unsupported to me. And its not like traditional economics have been thrown out the window here. Economics is always part math and part behavioral science and this change of course seems to entail just a slightly greater emphasis on the behavior side of things.
As for the rosy, unchallenging perspective of this particular article, you don’t need to go any further than the title of the magazine to find your answer for why the piece was so sympathetic to Obama. If you want a less fawning perspective, switch to Newsweek.

Comments on: Bias we can believe in

By: Ryan