Monday, July 7
-- Bounded Rationality--
Neoclassical economics created a unified framework for "explaining" that virtually all human behavior is produced by an Olympian process of utility maximization that recognizes no limits to the knowledge or thinking power of the human actor.
-- Organizations and markets as the solution to our coordination problem? --
Substantial stability of manufacturing, consumption, and trade is essential to markets’ working effectively. And, of course, social institutions, and governmental organisations in particular, play an essential role in maintaining (and occasionally destroying) that stability. When the qualifying conditions for the stability of markets are not met--e.g. wartime--we see a rapid movement toward centralized planning as the preferred coordinating mechanism for many activities.
Neoclassical economics created a unified framework for "explaining" that virtually all human behavior is produced by an Olympian process of utility maximization that recognizes no limits to the knowledge or thinking power of the human actor.
-- Organizations and markets as the solution to our coordination problem? --
Substantial stability of manufacturing, consumption, and trade is essential to markets’ working effectively. And, of course, social institutions, and governmental organisations in particular, play an essential role in maintaining (and occasionally destroying) that stability. When the qualifying conditions for the stability of markets are not met--e.g. wartime--we see a rapid movement toward centralized planning as the preferred coordinating mechanism for many activities.
