Comments on: Dan Ariely 3 of 3: Trust and Healthcare Reform

By: gregorylent

gregorylent — Wed, 30 Sep 2009 17:21:02 +0000

a concept, ok, theory, that will reveal itself out of the conundrums that you point out is the one called collective consciousness … we actually don’t know how to measure most of the influences that make up this world, even the facts are questionable, because they are facts only at lower levels of consciousness, or lower levels of understanding …

rationality and its opposite are quite naive concepts in terms of higher levels of mind, they brought us this far, but cannot get us home …

there are a lot of concepts in this blog post, and the earlier pieces … without backing it up with argument, i will offer than many of them need their roots examined for actual viability .. cause and effect are not what they seem, in short … more than that is an essay that i don’t wish to write ..

thanks for all of this … enjoy, gregory

By: Barrie Abalard

Barrie Abalard — Tue, 29 Sep 2009 23:59:16 +0000

This is why economics, to me, is not a science–all these theories are based on the faulty assumption that humans act rationally (kudos to Dasan for nailing it in his comment). I live with a mathematician turned firmware engineer, so I am familiar with the rigor needed when examining models and theories in the pure sciences. All comes into question if the data don’t support the model/theory. But we love to believe in theories because we find their elegance and beauty and self-fulfilling prophecy aspects comforting. Sadly, however, that doesn’t make them true.

By: Dasan

Dasan — Tue, 29 Sep 2009 18:49:00 +0000

I struggled with this throughout business school. How could economics be reliable if the whole thing rested on a faulty core assumption – that human beings acted rationally?

The Black-Scholes Formula/Equation, on which most derivatives pricing is based, has the same problem – it’s an elegant mathematical formula based on a faulty premise – that stocks move according to Brownian motion which is based on the Normal distribution. Clearly they don’t.

Astronomers and Physicists are much more flexible in their thinking about their core assumptions. See one “String Theory” for example.

By: christine cox

christine cox — Tue, 29 Sep 2009 16:44:33 +0000

This is great perspective. I love things that bring large, confusing issues into simple context. And i especially like the conclusion here – that we often subscribe to theory before face – a major problem, no doubt, in all parts of our lives.