Friday, May 27, 2016

SMD(H)

As a side note to this post, I'd like to point out that microeconomic rationality assumptions have no macroeconomic implications. It's one of the takeaways from the SMD theorem. Therefore a complaint that economics has perfectly rational individuals is really irrelevant to macroeconomic policy.

So if you are ever talking about policy (like here), complaints about the assumption of rationality in traditional economics are kind of silly.

I'm under the impression that you can make all kinds assumptions about individuals and end up with the same macroeconomy (for one thing, that solves the problem of tractable/simplified agent based models mapping to conclusions about real economies).


3 comments:

  1. Hello Jason, PING. Are you going to look at the revised manuscript? I need it posthaste, please!!!

    ReplyDelete
    Replies
    1. I thought I already sent it to you.

      Delete
    2. I sent it to your other email -- I just forwarded it to you the other one.

      Delete

Comments are welcome. Please see the Moderation and comment policy.

Also, try to avoid the use of dollar signs as they interfere with my setup of mathjax. I left it set up that way because I think this is funny for an economics blog. You can use € or £ instead.