Economics

[dreamdancer 0]

to begin...

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Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek (oikonomia, "management of a household, administration") from; (oikos, "house") + (nomos, "custom" or "law"), hence "rules of the house(hold)". Current economic models emerged from the broader field of political economy in the late 19th century. A primary stimulus for the development of modern economics was the desire to use an empirical approach more akin to the physical sciences.

Economics aims to explain how economies work and how economic agents interact. Economic analysis is applied throughout society, in business, finance and government, but also in crime, education, the family, health, law, politics, religion, social institutions, war, and science. The expanding domain of economics in the social sciences has been described as economic imperialism.

http://en.wikipedia.org/wiki/Economics

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[dreamdancer 0]

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Game Theory has emerged recently as a powerful challenger to the conventional method of examining economics. Although many illustrious predecessors worked on problems in what can be called "game theory", the fundamental, formal conception of game theory as part and parcel of economic theory were first organized in John von Neumann and Oskar Morgenstern's 1944 classic, Theory of Games and Economic Behavior (1944).

The main purpose of game theory is to consider situations where instead of agents making decisions as reactions to exogenous prices ("dead variables"), their decisions are strategic reactions to other agents actions ("live variables"). An agent is faced with a set of moves he can play and will form a strategy, a best response to his environment, which he will play by. Strategies can be either "pure" (i.e. play a particular move) or "mixed" (random play). A " Nash Equilibrium" will be reached when each agent's actions begets a reaction by all the other agents which, in turn, begets the same initial action. In other words, the best responses of all players are in accordance with each other.

http://homepage.newschool.edu/het//schools/game.htm

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[metalslug 36]

Uhm.. yeah.. I agree.

[popsjumper 2]

Ecocomical!

Economics is simple.
If it's available, buy it if you can.
If not, you got problems.

My reality and yours are quite different.
I think we're all Bozos on this bus.
Falcon5232, SCS8170, SCSA353, POPS9398, DS239

[rehmwa 2]

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Ecocomical!

Economics is simple.
If it's available, buy it if you can.
If not, force someone else to and then be angry at them for helping you and sit idle while your life crashes down the gutter not understanding why that's happening.

fixed it for contemporary free thinkers who care about the children

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[dreamdancer 0]

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If you expect equal pay for equal work, you're not the only species to have a sense of fair play. Blame evolution.

Researchers studying brown capuchin monkeys (Cebus apella) have found that the highly social, cooperative species native to South America show a sense of fairness, the first time such behavior has been documented in a species other than humans.

The question of whether human aversion to unfair treatment—now shown by other primates—is an evolved behavior or the result of the cultural influence of large social institutions like religion, governments, and schools, in the case of humans, has intrigued scientists in recent years.

The new finding suggests evolution may have something to do with it. It also highlights questions about the economic and evolutionary nature of cooperation and its relationship to a species' sense of fairness, while adding yet another chapter to our understanding of primates.

"It looks like this behavior is evolved … it is not simply a cultural construct. There's some good evolutionary reason why we don't like being treated unfairly," said Sarah Brosnan, lead author of the study to be published in tomorrow's issue of the science journal Nature.

http://news.nationalgeographic.com/news/2003/09/0917_030917_monkeyfairness.html

stay away from moving propellers - they bite
blue skies from thai sky adventures
good solid response-provoking keyboarding

[kallend 2,150]

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to begin...

Quote

Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek (oikonomia, "management of a household, administration") from; (oikos, "house") + (nomos, "custom" or "law"), hence "rules of the house(hold)". Current economic models emerged from the broader field of political economy in the late 19th century. A primary stimulus for the development of modern economics was the desire to use an empirical approach more akin to the physical sciences.

Economics aims to explain how economies work and how economic agents interact. Economic analysis is applied throughout society, in business, finance and government, but also in crime, education, the family, health, law, politics, religion, social institutions, war, and science. The expanding domain of economics in the social sciences has been described as economic imperialism.

http://en.wikipedia.org/wiki/Economics

Problem is that most economic "theory" makes the unreal assumption of rational behavior by human beings.

If its predictive value was any good we wouldn't be in this recession.

...

The only sure way to survive a canopy collision is not to have one.

[Butters 0]

You left out ...

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Only female capuchins were tested because they most closely monitor equity, or fair treatment, among their peers, Brosnan said.

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Brosnan said the response to the unequal treatment was astonishing: Capuchins who witnessed unfair treatment and failed to benefit from it often refused to conduct future exchanges with human researchers, would not eat the cucumbers they received for their labors, and in some cases, hurled food rewards at human researchers.

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Those actions were significant. They confirmed that not only did capuchins expect fair treatment, but that the human desire for equity has an evolutionary basis.

Did the Capuchins who witnessed unfair treatment and benefited from it act the same as the Capuchins who witnessed unfair treatment and failed to benefit from it ... no. Thus, this did not confirm a desire for equity.

"That looks dangerous." Leopold Stotch

[Andrewwhyte 1]

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Problem is that most economic "theory" makes the unreal assumption of rational behavior by human beings.

If its predictive value was any good we wouldn't be in this recession.

Rational behavior is used because it is believed to be an unbiased rather than accurate estimator of agent behavior. But I suspect you already knew that Doc.

[kelpdiver 2]

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Problem is that most economic "theory" makes the unreal assumption of rational behavior by human beings.

If its predictive value was any good we wouldn't be in this recession.

Who didn't act rationally? There is plenty of theory - mostly stemming out of the game theory side - to explain the behavior that lead to this bubble, like any other in history.

Individuals act as ... wait for it ... individuals. That can lead to poorer outcomes for everyone - the prisoners' dilemma on a macro scale.

[pirana 0]

I agree that their is a general desire to be treated fairly, or maybe better said that there is a general desire for fair treatment for all. But that is in contradiction to the greedy behavior our economic system appears to sanction (IMO an unfortunate remnant of survival behavior when life in general was so much more tenuous).

Quite the dichotomy; and one I don't see going away anytime soon, primarily because what is seen as fair is so subjective.

" . . . the lust for power can be just as completely satisfied by suggesting people into loving their servitude as by flogging them and kicking them into obedience." -- Aldous Huxley

[billvon 3,119]

>I agree that their is a general desire to be treated fairly, or maybe better
>said that there is a general desire for fair treatment for all. But that is in
>contradiction to the greedy behavior our economic system appears to
>sanction . . .

Well, we see both altruistic and greedy behavior in people (and many other animals) and both of those are echoed in many parts of our economic system. We see greed driving much of our economic system, with fairness both inherent in the system (i.e. open markets) and imposed on the system (i.e. equal opportunity laws, minimum wage etc)

[dreamdancer 0]

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In a classic experiment known as the Ultimatum Game, person A is given 10 coins to split between himself and person B. If person B accepts the distribution, they both keep the coins; if not, no one gets paid.

According to Game Theory, the optimal solution is for person A to give himself nine coins and person B one coin——both will end the game richer than when they started. However, played in the wild, the most common distribution is 6-to-4, a ratio seen as fair by both parties.

But why? What's the origin of the human idea of fairness?

To answer that, let's take a look at a spin on the Ultimatum Game called the Dictator Game. In Dictator, player A decides how to split the 10 coins and they're split accordingly. Just like that. Player B has no say. In this game, person A is much more likely to split the coins 9-to-1.

The difference between Ultimatum and Dictator is, of course, person B's ability to punish person A. Let's take a closer look:

In Ultimatum, person B scoffs at a one-coin offer, sacrificing personal gain in order to punish person A's greed. Game theorists call this move an altruistic punishment. While person B loses a coin in this maneuver, he can expect his corrective behavior to result in more coins for him and all the other B's of the world down the line.

Over time, player A has come to expect punishment for unfair behavior and has learned to limit his greed. So to some extent, humans have become social maximizers instead of personal maximizers.

http://www.science20.com/brain_candyfeed_your_mind/game_theory_and_evolution_fairness

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[rehmwa 2]

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> fairness both inherent in the system (i.e. open markets) and imposed on the system (i.e. equal opportunity laws, minimum wage etc)

and you'd get arguments from many that "Fair" is not represented by equal opportunity laws (at least in practice as they are today) or minimum wages - these would be just the opposite as they drive non sequitor preferences despite their intentions

and others would argue the same on open markets

can't win, why try

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[billvon 3,119]

>and you'd get arguments from many that "Fair" is not represented
>by equal opportunity laws . . .

Right, just as we get arguments that an open market is not "fair" because it puts the poor at a disadvantage (as you mentioned.) I think we do a pretty good job of finding a balance, though.

[kallend 2,150]

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Problem is that most economic "theory" makes the unreal assumption of rational behavior by human beings.

If its predictive value was any good we wouldn't be in this recession.

Who didn't act rationally? There is plenty of theory - mostly stemming out of the game theory side - to explain the behavior that lead to this bubble, like any other in history.

.

That the explanation came after the fact simply illustrates the poverty of economic "theory". Calling it "the dismal science" is overly generous.

...

The only sure way to survive a canopy collision is not to have one.

[metalslug 36]

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If you expect equal pay for equal work, you're not the only species to have a sense of fair play. Blame evolution.

Researchers studying brown capuchin monkeys (Cebus apella) have found that the highly social, cooperative species native to South America show a sense of fairness, the first time such behavior has been documented in a species other than humans.

The question of whether human aversion to unfair treatment—now shown by other primates—is an evolved behavior or the result of the cultural influence of large social institutions like religion, governments, and schools, in the case of humans, has intrigued scientists in recent years.

The new finding suggests evolution may have something to do with it. It also highlights questions about the economic and evolutionary nature of cooperation and its relationship to a species' sense of fairness, while adding yet another chapter to our understanding of primates.

"It looks like this behavior is evolved … it is not simply a cultural construct. There's some good evolutionary reason why we don't like being treated unfairly," said Sarah Brosnan, lead author of the study to be published in tomorrow's issue of the science journal Nature.

I welcome equal pay for equal work, but defining and measuring "equal work" is a point of debate.

One of the core principles of economic pricing is supply and demand. An experienced engineer working a 10 hour shift alongside the janitor cleaning up around him is not doing "equal work".
How do we know this? It's because you cannot swap their positions around. If both employees left the company, recruiting a new janitor of similar skill would be less of a challenge than replacing the engineer. Supply and demand.
To expect to employ skilled and unskilled workers at the same wage rate would be comparable to expecting to buy platinum and copper at the same market price.

The study of monkeys and other primates may well hint at the origins of some human instincts, but researchers are surely not advocating that we should continue to think or behave like monkeys?