Nova--Mind Over Money

[Bud Struggle]

An interesting show (hour) from Nova. It concludes that humans are basically irrational when it comes to money (like food and sex) and that we are to a good extent incapable of making good decisions.

If you extrapolate this out this may account for the poor showing that Communism has in a lot of circumstances even though it if by far the most logical way to dispense of the world's resources.


http://www.pbs.org/wgbh/nova/money/

Definitely worth a watch.

[Lynx]

What happened to "Thou shalt not question the invisible hand" ?
It would seem the financial crisis has lent some credibility towards behavioral economists. A lot more study is needed.

[Drace]

Human choices are rational.

[Nolan]

Human choices are rational.

As in?

[The Gallant Gallstone]

Human choices are rational.

I'd say that human beings are capable of making rational choices.

There's a significant distinction.

Though we're capable of making rational choices, I believe it takes an effort on our part to do so. We do not usually make rational choices on auto-pilot. You focus your mind, you get a clear understanding of the situation (or as clear as possible), deliberate on the options, and make your choice.

That's a fair amount of effort.

[Dimentio]

An interesting show (hour) from Nova. It concludes that humans are basically irrational when it comes to money (like food and sex) and that we are to a good extent incapable of making good decisions.

If you extrapolate this out this may account for the poor showing that Communism has in a lot of circumstances even though it if by far the most logical way to dispense of the world's resources.


http://www.pbs.org/wgbh/nova/money/

Definitely worth a watch.

I agree that it is worth watching. What I disagree with is the idea that a command economy is necessarily communism. There were even pre-modern command economies, of which some strangely enough performed better than the Soviet Union in terms of longevity. What is characterising for all command economies though is a mixture between centralisation and authoritarianism.

The semi-communist societies of old age were basically the Native Americans prior to the settlement of Europeans, the Ibo in Nigeria, some Celtic and Germanic tribes during antiquity.

[Dean]

If you extrapolate this out this may account for the poor showing that Communism has in a lot of circumstances even though it if by far the most logical way to dispense of the world's resources.
More importantly, it blows the capitalist notion of "rational economic actors" out of the water.

[SocialistCatisSocialist]

I'd say that human beings are capable of making rational choices.

There's a significant distinction.

Though we're capable of making rational choices, I believe it takes an effort on our part to do so. We do not usually make rational choices on auto-pilot. You focus your mind, you get a clear understanding of the situation (or as clear as possible), deliberate on the options, and make your choice.

That's a fair amount of effort.


Absolutely. There's also the two cases of the "sh*t happens" and "the world doesn't revolve around you.


Sh*t happens - Random catastrophes/events occur and that requires everyone to alter their plans of action and move onto the most important issue at the time. That lowers one's concentration.


"The World Doesn't Revolve Around You" - People have different ideas on how our money should be best spent. Where should we utilize our funds? One person says health care and other says education. It even boils down to a married couple who want different things. Basically, conflicting opinions and ideologies can lead to disaster. Only a forex broker can save the day....though they may have issues too. ;)

[mikelepore]

Human beings are easily persuaded by messages in quantity. If you tell someone a thousand times "you cannot be happy unless you acquire a blue widget", then that person cannot be happy without acquiring a blue widget. The pure waste of social resources known as the advertising business treats us as though we were fools, and then we immediately begin to play the role that was asked of us.

[Bud Struggle]

Human beings are easily persuaded by messages in quantity. If you tell someone a thousand times "you cannot be happy unless you acquire a blue widget", then that person cannot be happy without acquiring a blue widget. The pure waste of social resources known as the advertising business treats us as though we were fools, and then we immediately begin to play the role that was asked of us.

And how is that different than the Marxist message: you won't be happy unless you aquire the means of production?

[Lynx]

Socialism is a tougher sell.

[#FF0000]

And how is that different than the Marxist message: you won't be happy unless you aquire the means of production?

That's not really the message. "There can't be justice until everyone controls the means of production" might be closer but that is an awful slogan.

[Bud Struggle]

That's not really the message. "There can't be justice until everyone controls the means of production" might be closer but that is an awful slogan.

Sure there can be justice. The Means of Production only matters if you think economics have some import in this world. Lots of people do--but lots don't.

There's more to life than money. There's more to life than power. But after that--Communism has nothing to say, does it?

[LeftSideDown]

Socialism is a tougher sell.

This made my day.

[Dean]

There's more to life than money. There's more to life than power. But after that--Communism has nothing to say, does it?
This is where you're wrong.

Both alienation and the Authoritarian Personality are explicitly communist ideas which deal intimately with psychological and philosophical elements.

It's no mistake that Marx claimed that religion was the "opiate of the masses" and "the spirit of a spiritless world." These questions deal with human life right down to religion and what drives man... very penetrating and very much a series of broad doctrines on human life.

[#FF0000]

I'm pretty sure a ton of Existentialists were also p. big on Marxism as well?

[mikelepore]

And how is that different than the Marxist message: you won't be happy unless you aquire the means of production?

I don't know about that. I was only responding to the words in post #1 -- I agree that our species in "irrational when it comes to money" and we are "incapable of making good decisions." There is even an effect well known in the marketing field that certain color labels and print fonts affect shopper choices. Many people bought a certain brand of coffee because the advertisement showed the face of the actor who portrayed a doctor in a television drama. Millions of people switched brands because a new advertisment said "the sex-appeal toothpaste." It has to be a failure to have any economic system that relies on "voting with your money" because that is where we are the most idiotic.

[Glenn Beck]

Just because human economic choices aren't always motivated by instrumental rationality or specifically aren't rational towards "maximizing utility" doesn't mean they're irrational. Most people have rationality oriented towards other ends, which leads me to:
Sure there can be justice. The Means of Production only matters if you think economics have some import in this world. Lots of people do--but lots don't.

There's more to life than money. There's more to life than power. But after that--Communism has nothing to say, does it? I think this might be the first time I've ever heard someone use the fact that most people are indifferent to economic logic as an argument in favor of the one system that bases the most decisions on economic logic out of any of the ones that have ever been implemented.

[REVLEFT'S BIEGGST MATSER TROL]

Sure there can be justice. The Means of Production only matters if you think economics have some import in this world. Lots of people do--but lots don't.

There's more to life than money. There's more to life than power. But after that--Communism has nothing to say, does it?

Well man, I don't really think that economics matter to too many people, but sometimes it just has to matter or people miss out anything they do care about. The basic material requirements for continuing existence being the most obvious case of this.

So if anything, this seems more like an argument for communism - people aren't concerned with "materialist goals", so lets make it so they don't actually have to be concerned with it to some extent, which is the case in capitalism.

[Jimmie Higgins]

I'll have to check out the video.

But just in response to what people have been saying I think people can make rational choices about personal fiances, the problem is that we live in an irrational system and often find ourselves in very volatile or tenuous economic situations.

It's hard to plan ahead when you live paycheck to paycheck. You end up trying to be as rational and conservative as you can be but it's also hard when you have little money to be prepared for a car accident or breakdown, health problems, layoffs and so on.

I don't think there is too much correlation between people dealing with personal finances and people dealing with business or government finances though. It would be like trying to compare personal grocery shopping to Wal-Mart's peurchasing department - there are totally different concerns involved in the decision-making.

A lot of things that industries and large companies do that seems irrational from our perspective is rational from a profit-making perspective. The same could be said about the USSR - a lot of irrational choices on their part had to do with maintaining the staus-quo there: so maintaining a large military while people lacked some basic staples is irrational from our perspective, but totally rational if you are one of the ruling class in Russia.

So, to me, "People" are not the cause of irrational systems - it's the interests of certain people ruling society which can seem irrational to most people in that society.