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I think modern economists have been acknowledging and quantifying the flaws in simplifying assumptions in economic models for decades [1].

That being said, I do think there is a serious problem in the way economics is often taught, and things like debt (and more broadly, anthropology) is part of the cure [2]

[1] https://en.wikipedia.org/wiki/Behavioral_economics

[2] https://ravik.substack.com/p/does-learning-economics-make-yo...




> modern economists have been acknowledging and quantifying the flaws in simplifying assumptions in economic models for decades

Just FYI, both Kahneman and Tversky were psychologists, not economists.


Noted, but they still are pretty accepted in mainstream economics (nobel prize in economics in 2002).

Also of course, they're not the only ones doing behavioral economics [1]:

> Imperfect information is core to modern econ; theories showing how imperfect information can cause markets to break down received a Nobel 20 years ago. Perfect rationality has been successfully challenged by behavioral economics for decades, and received Nobels in 2002, 2013, and 2017.

[1] https://noahpinion.substack.com/p/this-years-econ-critics-ma... (includes links)


Definitely, but it amused me that psychologists keep winning the economics nobel :)


It might say more about economics than it does about psychology :)


Economics is hard. Behavioral economics is having a hard time right now with many of the core hypothesis (loss aversion) and key interventions (priming) turning out to be experimentally not-reproducible.

See https://www.thebehavioralscientist.com/articles/the-death-of... - for an overview.


Behavioral economcis is just one branch. The idea that economists always believed humans were 100% rational decision makers has never ever been true.

That just a strawmen that Garber and co set up. Anybody that actually studies the history of economics knows this.




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