5 MOL! – I don’t need sleep…

Yesterday we defined a rational person to be someone who chooses what is best for herself given an objective, which is self-defined.

When we say best, we mean what the person believes to be best. It doesn’t matter what others think, or what society thinks, or what actually is best.

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Should we discard the assumption of rationality?

Ever since I was introduced to economics, I was always troubled by one of its fundamental assumptions – the notion of rationality. Many bestselling economics books, such as Dan Ariely’s Predictably Irrational, and my once-favourite (yes, I finally found a new favourite!) book Freakonomics deal with this assumption. They discuss how restrictive and unrealistic it is, and how behavioural models provide much more accurate representation of human behaviour. To some extent, I agree with their conclusion, but in this post, I am going to argue that the rationality assumption is not as useless as many, especially A-level students, perceive it to be.

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Where is Economics going?

This question was posed to eight of the world’s top young economists, and here are their responses compiled:

http://bigthink.com/power-games/empirics-and-psychology-eight-of-the-worlds-top-young-economists-discuss-where-their-field-is-going?page=all

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