Dom S says:
August 27 2018 at 6:54 pm
“But let’s also be clear that the stereotype of capitalism that so many want to believe in is as simplistic, and as wrong, as that of socialism I have noted above. That stereotype is widely taught by economists as if it is true.

It assumes that all markets are ‘perfect’. That means there are masses of firms engaged in the supply of any product and each competes only on price because consumers have all the information they need on all of them to know that the products are indeed identical.”

I’ve never heard of an economist that argues that all markets are perfect.

Can you please name one economist, and cite his or her work where he or she makes this claim?

Richard Murphy says:
August 27 2018 at 9:27 pm
That is the foundation of micro and in turn all macro

Rational expectations are built on this idea

Find me neoclassical economists who do not think this, or at least think this is the model from which all other models deviate

That would be all of them then.

What is the ‘Rational Expectations Theory’?
The rational expectations theory is an economic concept whereby people make choices based on their rational outlook, available information and past experiences.

He’s missed the importance of “available” there.

Obviously people on’t have all information. If this were true there would never be any new information which moved markets and the efficient markets hypothesis would be wrong, wouldn’t it?

8 thoughts on “Sigh”

  1. What do you expect Tim – rational thought from a man who refuses to read economics text books because they are neocon ? 40+ years ago he attended some economics lectures that he half remembers – forgetting the heavy dose of IF that is a major component of economic theory. The IF of course being reality. As any fule kno the potato is detached from reality – a prime example being his insistence on vermin for giving corbyn some hair brained economic ideas. It’s demonstrably proveable that Corbyn is not the brightest bulb in the world, but even he saw through the charlatans flim flam. What’s his latest insanity – Nationalize auditing with no doubt him hoping for a cushy well paid number in any such organisation.
    As for his hapless blog I suspect that he now only publishes it so that his group of sycophants can tell him how wonderful he is, as he sits in front of a mirror stroking himself. Or of course he might just be deluded and in need of urgent mental health intervention.
    It’s about time he fucked off to europe as he’s been threatening to do and stop blogging.

  2. Bloke in North Dorset

    “…. make choices based on their rational outlook, ….”

    He’s also missing the importance of “their outlook” two people with the same information may make different decisions for entirely rational reasons.

  3. So people aren’t as rational and predictable as spud says economists think they are. Therefore we should have more central planning. Offering everyone a Trabant is the only way to deal with all that complexity obviously.

  4. Building a ring of Soviet-style nuclear reactors around Ely could be another way of illustrating the joys of corajus state planning

  5. Moqifen

    Apparently it would be in their economics faculty – and his lack of Danish language skills might not be an issue as most Danish students know English – you read it here first!

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