The terrific David Levine – game theorist and expert on intellectual property issues – is publishing on his website under a Creative Commons Licence, a new book, Is Behavioural Economics Doomed? He writes:
“Those who have read
about –
and who has not? – the current economic crisis may wonder just how
rational economic man or woman is. Behavioral economics has become the
modern rage. So is rational economic man – homo economicus – dead? Has
the economics profession moved on to recognize the true irrationality
of humankind? Read on.“
The intro and chapter one are currently available. The whole book will be published by Open Book Publishers, about whom I've blogged in the past. Chapter One is an exploration of what 'homo economicus' actually means. Behavioural economics makes much of experimental results that seem to overturn what conventional economics assumes by way of human behaviour. Levine describes the equally prevalent experimental results which uphold the conventional approach, and concludes:
“[C]ompetitive equilibrium predicts the outcome of market experiments with a high degree of accuracy, with experimental markets converging quickly to approximately the competitive price.”
