Role reversal: the models shape the modellers

[cyu]

From http://www.nakedcapitalism.com/2012/03/the-new-priesthood-an-interview-with-yanis-varoufakis-part-i.html

"Amongst the fresh(wo)men, the ones that major in economics did not behave differently. amongst graduates those with an economics training were much less likely to contribute, and more pessimistic about others. The conclusion is inescapable: training in economics increases the probability that a person becomes less sociable, more aggressive, less cooperative; in short, miserable.

When a person is told repeatedly that to be rational means to be ruthlessly instrumental (i.e. to treat others as a means to one’s own ends), and that contributing is for sissies (or, more ‘scientifically’, irrational), is it any wonder that training in economics makes persons more brutish and nastier?

The end result is that youngsters with a heightened sense of civic responsibility either drop out of economics, in a bid to retain it, or manage gradually to shed it. the models shape the modellers, rather than the other way round."

[Blake's Baby]

Well there you go, I'd always assumed that it was the other way round and economics attracted a large proportion of total tools. Instead it seems economics produces a large proportion of total tools.

[Regicollis]

Economy school is to capitalism what divinity school is to Christianity.

[dodger]

Economy school is to capitalism what divinity school is to Christianity.

What's more they should return academic accolades when proved wrong. The Nobel Prizes should also be stripped, if they haven't the common decency to send them back. No shame in being wrong. They should just be made to go back to junior school and start again. Like "snakes and ladders".

[Dennis the 'Bloody Peasant']

I remember reading a piece about the mindset of economists that said the characteristics and attitudes of the uber free-market economists was identical to that of psychopaths.
Wish I coiuld remember where I got that from but I'm sure it was a 'legit' study of some kind.

EDIT: It was an Adam Curtis doc that observed "In fact, in formal experiments the only people who behaved exactly according to the mathematical models created by game theory are economists themselves, and psychopaths"
Apologies, must think before I type or else it's just a YouTube comments page

[cyu]

It was an Adam Curtis doc that observed "In fact, in formal experiments the only people who behaved exactly according to the mathematical models created by game theory are economists themselves, and psychopaths"

Thanks, from http://en.wikipedia.org/wiki/The_Trap_%28television_documentary_series%29

He invented system games reflecting his beliefs about human behaviour, including one he called "F**k Your Buddy", in which the only way to win was to betray your playing partner. when RAND's analysts tried the games on their own secretaries, they instead chose not to betray each other, but to cooperate every time. This did not, in the eyes of the analysts, discredit the models, but instead proved that the secretaries were unfit subjects.

in formal experiments the only people who behaved exactly according to the mathematical models created by game theory are economists themselves, and psychopaths.

[cyu]

A discussion about the Curtis documentary on reddit pointed out this gem:

http://www.youtube.com/watch?v=UMAiIEpZdRU#t=23m25s

#t=9m45s
The game turned into something like this - farcical football...

#t=23m25s
The cheats would drive the suckers extinct, but the cheats' success might be short-lived. The parasites might then drive them extinct as well.

#t=33m10s
as we come to the bottom of the heap, we find all the nasty strategies. They all score badly because eventually they have to play against each other.

#t=39m30s
sometimes they were aimed to fall out of harm's way. Snipers could shoot to miss. Machine-gunners sometimes elected to fire high and wide. It allowed countless soldiers on both sides very long periods of peaceful co-existance.

[cyu]

http://www.zerohedge.com/news/2015-04-09/us-dollar-surge-returns-pushes-equity-futures-lower

Seems these days wealthy investors are running around in barely contained panic, wondering where they should park their investments. In theory, if USD, gold, or wheat were good long term investments, they'd just park their wealth there, and they'd be safe, and they could finally go relax on a beach. In practice, wealth inequality has gotten so wide, that it is no longer good investments that keep investors wealthy, but that it is now wealthy investors that turn things into good investments.

If investors *think* that USD is a good investment, then the value of USD shoots up. If investors *think* that gold is a good investment, then the value of gold shoots up. The tail is wagging the dog. It's not really anything new though. The value of gold has always been kept up because the tail was wagging the dog. The main difference between the past and today, is that the situation is getting worse. As the political and economic machinations of the ruling class makes wealth inequality ever more ridiculous, investment becomes ever less about economics, and ever more about being able to psychologically manipulate the richest investors.

[Comrade #138672]

I remember reading a piece about the mindset of economists that said the characteristics and attitudes of the uber free-market economists was identical to that of psychopaths.
Wish I coiuld remember where I got that from but I'm sure it was a 'legit' study of some kind.

EDIT: It was an Adam Curtis doc that observed "In fact, in formal experiments the only people who behaved exactly according to the mathematical models created by game theory are economists themselves, and psychopaths"
Apologies, must think before I type or else it's just a YouTube comments pageI have been into game theory recently (after following a course on it), and viewed in the right way, it can also help to explain co-operative behavior. For example, the infinitely iterated prisoner's dilemma has a Nash equilibrium where both players co-operate. This therefore punishes defection. In fact, in real-life, there are rarely games that are not "infinitely iterated". When researchers try to impose simplistic models on reality, without any form of iteration and social feedback, then you will get really strange results.

People often mistakenly assume that "selfishness" is mutually exclusive with co-operative behavior, but this is not necessarily true. Game theory is just a model, a framework for studying games. It is not inherently psychopathic, even when some of its pioneers were sociopathic and/or paranoid of other people.