In article
<bc8d28c0-6a8e-4745-af09-b15bdab8b...@n9g2000pbi.googlegroups.com>,
 Shawn Wilson <ikonoql...@gmail.com> wrote:

I like to say that the one advantage I got from getting a PhD in
theoretical physics before switching to economics is that I can do
non-mathematical work without having people accuse me of being afraid of
mathematics.

Doing the math without any understanding of what it actually means has
unfortunate results--I've refereed papers like that.

Are you familiar with Marshall's comment on the subject? You might also
consider Ricardo's _Principles_. He managed to do general equilibrium
theory, I believe for the first time ever, with no mathematics beyond
arithmetic.

I note, by the way, that by conventional definitions you are the amateur
(as is Robert, to whom I was responding) and I am the
professional--doing economics is how I made my living for a very long
time. Which does not, of course, mean that I am right and you or he
wrong when we disagree--professionals can be wrong too.

--
http://www.daviddfriedman.com/
http://daviddfriedman.blogspot.com/
_Salamander_: http://tinyurl.com/6957y7e
_How to Milk an Almond,..._ http://tinyurl.com/63xg8gx

On Jul 5, 12:07 pm, David Friedman <d...@daviddfriedman.nopsam.com>
wrote:

David, *I* have an actual education in this field...  I don't need
your uninformed comments on something I have a great deal of formal
training in.

Pay close attention-  I have intuition and understanding AND
mathematical rigor in my bag of tricks.  In fact, smart money says my
intuition and understanding are superior to yours- I have the tools to
logically analyze the details of assumptions and reasoning which you
lack.

Case in point- the error you made in blythely ass-uming not only that
a descriptive statistic was an innate property of a thing, but that
scaling would not change it (cf minimum wage effects and
'elasticity').

You are enacting a very good version of sour grapes- deriding the
value of something you do not possess.  You aren't as good an
economist as you seem to think you are.

Proof by pointing to your credentials only works if you HAVE the
credentials.  So far as the rest of the world can see, you do NOT have
the education.

And David is better at explaining the points without yelling at
people.
--
I used to own a mind like a steel trap.
Perhaps if I'd specified a brass one, it
wouldn't have rusted like this.

On 7/5/2012 3:07 PM, Shawn Wilson wrote:

There, I fixed it for you.

In article
<3378563e-29c4-49c2-aec1-32f0a5d3f...@f8g2000pbf.googlegroups.com>,
 Shawn Wilson <ikonoql...@gmail.com> wrote:

That is to say, you have taken some of the sort of courses I have taught.

...

I gather you aren't familiar with Marshall's comment on math vs verbal
arguments, or Ricardo's _Principles_.

--
http://www.daviddfriedman.com/
http://daviddfriedman.blogspot.com/
_Salamander_: http://tinyurl.com/6957y7e
_How to Milk an Almond,..._ http://tinyurl.com/63xg8gx

"Complex carboyhdrates," meaning long polymers of sugars.  Or "fiber"
if the polymer is indigestible.  It's best to get plenty of both.
White flour has plenty of the former but not much of the latter.

Epicycles versus Occam's razor.

Why, then, are some people rich?
--
Keith F. Lynch - http://keithlynch.net/
Please see http://keithlynch.net/email.html before emailing me.

You were _exposed to_ an actual education and formal training. It does not
seem to have sunk in, but rather run off, like water off a duck's back that's
standing on an elephant.

You never seem to open THAT bag of tricks, though. You keep opening the one
labelled "ACME".

And if anyone should know how to recognize this, Shawn should!

Dave "except he doesn't" DeLaney
--
\/David DeLaney posting from d...@vic.com "It's not the pot that   grows the flower
It's not the clock that slows the hour  The definition's plain for anyone to see
Love is all it takes to make a family" - R&P. VISUALIZE        HAPPYNET VRbeable<BLINK>
http://www.vic.com/~dbd/ - net.legends FAQ & Magic / I WUV you in all CAPS! --K.

In article <jt5h0o$fk...@reader1.panix.com>,
 "Keith F. Lynch" <k...@KeithLynch.net> wrote:

Because they were lucky, or have scarce and valuable talents, or have a
way of predicting the market that isn't deducible from the sort of
economic analysis available to lots of other people.

--
http://www.daviddfriedman.com/
http://daviddfriedman.blogspot.com/
_Salamander_: http://tinyurl.com/6957y7e
_How to Milk an Almond,..._ http://tinyurl.com/63xg8gx

In article <ddfr-15CAA6.23363804072...@news.giganews.com>,
David Friedman  <d...@daviddfriedman.nopsam.com> wrote:

Only if those predictions are sufficiently widely believed.  That's
why simple arbs (e.g. S&P futures vs. cash) tend to disappear, while
more complex or less-believed ones can persist for years or decades
and remain quite profitable.

I could provide some (expired, for obvious reasons) examples.

Seth

In article <6c27aa2a-8b19-4a29-b32c-383fff0e5...@qq9g2000pbb.googlegroups.com>,
Shawn Wilson  <ikonoql...@gmail.com> wrote:

Research in game theory / psychology has found that humans do not act
optimally.  For instance: ask people (prior to a lottery for tickets)
how much they'd pay for a ticket (assuming they didn't win the
lottery).  You might get answers like $200.

Then ask the winners (including some of the same people) how much
they'd sell their tickets (which they bought for $50 after winning the
lottery) for, and get answers like $1000.

Seth

On Jul 18, 7:15 am, se...@panix.com (Seth) wrote:

That only tells you what people *say*.  Economists know damn well that
people will say any damn fool thing, but they don't act that way.

On Jul 18, 2:19 pm, Shawn Wilson <ikonoql...@gmail.com> wrote:

Yes, their actual actions are even more irrational.

pt

On Jul 18, 12:01 pm, Cryptoengineer <petert...@gmail.com> wrote:

Actually, they aren't.

::: That only tells you what people *say*.  Economists know damn well
::: that people will say any damn fool thing, but they don't act that
::: way.

:: Yes, their actual actions are even more irrational.

You don't understand.  People's economic actions are *by* *definition*
rational.  What they got by their actions is, by definition, what they
wanted to get.  People always accurately predict exactly all the effects
(and side effects) of their choices, or if they didn't, what they *wanted*
was pot-luck.  By definition.

Definitions are wonderful things.

The fly in the ointment, of course, is that you can never tell what people
*will* do, because you don't know what they *want* until they actually
*do* something.  You can only make heuristic, statistical guesses, which
by their very nature can't take account of fads, transient memes,
and any of the myriad things that can cause statistical heuristics
to gang aft aglay.

But boy howdy, *after* the fact, economics is pretty amazing, since
it predicts that people did exactly what they did.  It's always right.  
Well... Shawn's version of economics that is.

On Jul 18, 5:00 pm, thro...@sheol.org (Wayne Throop) wrote:

By what definition is what someone gets as a result of their actions,
what they wanted to get? If I buy a house, and its value tanks, is
that what I wanted to happen?

Yes, that's a way its like astrology. Astrologers can always show how
peoples actions are predestined in their stars, if the subjects are
safely dead.

I refer Shawn to Kahneman and Tversky's experiments in Prospect Theory
if he thinks people make rational choices.

pt

On Jul 18, 2:00 pm, thro...@sheol.org (Wayne Throop) wrote:

Tell me, dumbass, how could you ever conclude that someone's actions
are irrational?  You can't see their desires.  How do you know their
actions don't, won't, or aren't intended to satisfy them?

Be specific.

Oh, right, it's you.  You will deal out a plethora of bullshit and
attacks before running away screaming that you someone 'won'.

Here's an opportiunity to demonstrate your quality.  And I *know* you
will...

On Jul 18, 2:31 pm, Cryptoengineer <petert...@gmail.com> wrote:

I am curious.  Why are you asking a manifest moron about technical
economic minutia when you have an actual economist availble?  Are you
stupid?

I *know* people make rational choices.  Tversky doesn't refute that.
At best he demonstrates the usual misunderstanding of rationality by
non-economists.

On Wed, 18 Jul 2012 14:29:49 -0700 (PDT), Shawn Wilson

Whereas yours has been demonstrated _ad nauseam_.

--
Bill Snyder  [This space unintentionally left blank]

:: You don't understand.  =A0People's economic actions are *by*
:: *definition* rational.  =A0What they got by their actions is, by
:: definition, what they wanted to get.

: Cryptoengineer <petert...@gmail.com>
: By what definition is what someone gets as a result of their actions,
: what they wanted to get?

Well... economic definitions, of course.
It makes the math ever so much cleaner.

: If I buy a house, and its value tanks, is that what I wanted to
: happen?

Well... sure.  You researched the real estate market and projected what
must happen to prices with rigid mathematical precision...  which is
clearly possible, what with economics being a precise, mathematical,
hard science and all, or if you didn't, you wanted pot luck.

    They laughed at me and made jokes but I proved beyond the shadow of a
    doubt and with geometric logic that a duplicate key to the wardroom
    icebox DID exist, and I'd have produced that key if they hadn't of
    pulled the Caine out of action.
                                         --- Captain Queeg

: Shawn Wilson <ikonoql...@gmail.com>
: Tell me, dumbass, how could you ever conclude that someone's actions
: are irrational?

You first.  *Is* there a way to tell if an action is irrational,
according to your definitions?  Be specific.

: You can't see their desires.

You can, of course, infer them by many means, especially observing
whether they are dissatisified with what they got by their action.
Which is also after-the-fact, but at least it's not *assuming* that
what they got is what they wanted, and hence was rational.
*That* is a pretty strong brand of silly.

: How do you know their actions don't, won't, or aren't intended to
: satisfy them?
:
: Be specific.

Hey, I have no problem with one's actions, by definition, being *intended*
to reach some goal, or satisfy some desire.  However, that doesn't
allow you to deduce desire from action.

For example, somebody gambles away their money, becomes destitute and
homeless.  Was that their desire?  Very likely not.  Likely they had
some pie-in-the-sky-by-and-by notion of becoming rich by gambling.

Now, is it *rational* to intend to become rich, and gamble to do so?
I don't mean semi-skilled games like blackjack or poker or whatnot.
I mean, say, roulette or the slots, where you can't apply skill to
the ball, wheel, or lever.  Is it rational?  No.

Now, how can you tell what they intended?  One way, if after the fact,
they tend to say "dangit, I didn't *intend* to become a homess and
destitute person".  I rather expect that they are pretty honest about
that.

So basically, an action is irrational if you use methods that
are reliably known not to get what you intended going in.

And no, I don't find the "yes he *did* want to become homeless and
destitute" to be very persuasive at all.  Unintended consequences
happen daily, to everybody, and to pretend they don't, or to pretend
that all consequences are intended, is silly.  I mean *really* silly.
Really *massively* silly.

Now, if you want to make economic predictions based on what people have
done in the past when faced with certain situations, that's all well
and good.  But it's no reason to corrupt the language by pretending
that what people do is always rational.  Again, really, massively, silly.
And unnecessary.

On Jul 18, 3:02 pm, thro...@sheol.org (Wayne Throop) wrote:

You are proclaiming that people are irrational.  *I* don't have to
prove anything.  You have asserted that people act irrationallly, I
insist that you prove that you could come to that conclusion.

Uh, only if you assume people are rational...

If you don't you can't infer anything.

Nope, because their actions could be predicated on a probability
distribution of outcomes, and nothing says every possibile outcome
must be desirable.

On Jul 18, 5:42 pm, Shawn Wilson <ikonoql...@gmail.com> wrote:

I'd ask, but David Friedman hasn't posted to this thread in nearly two
weeks. i don't think he's reading it any more.

You claim to 'just know'. So this is a matter of faith, not knowledge.
Certainly not experimental evidence, such as K & T present.

pt

: Shawn Wilson <ikonoql...@gmail.com>
: You are proclaiming that people are irrational.

No, I'm not.  I'm proclaiming that the notion that all economic
choices are rational, because what they got was w hat they wanted,
is useless and an impediment to understanding.

::: You can't see their desires.
:: You can, of course, infer them by many means,

: Uh, only if you assume people are rational...

Wrong.  Just because you are inferring something doesn't mean that
the something is rational.  If you can show that a given irrational
action is statistically probable, you can use that to infer the
corresponding goal.

I mean yeesh.  Who would suppose people have to be rational
in order to model their behavior?  That's really an elementary mistake.

: Nope, because their actions could be predicated on a probability
: distribution of outcomes

whether they are rational or not.  Gosh.  You may catch up to
the rest of the class someday.

On Jul 18, 5:40 pm, thro...@sheol.org (Wayne Throop) wrote:

Yawn.  A ususual you try to put the burden of proof off onto someone
else.

Either they are all rational or you can prove it's possible to
determine that some are irrational.  If you can't do the latter, then
you theory of 'irrationality' is menaingless and useless.  It's just
invisible demons making things happen.

So...

Put up or shut up.

Well, since you don't have a Nobel prize...

Really, learn something about economics before spouting nonsense.  You
would quite literally win a Nobel Prize if that were true.

Actually, here it does.

No.  The link between desire and action ***IS*** rationality to
economists.  You are operating (again) under an incorrect
understanding of the term 'rational' to economists.  You built a straw
man and you successfully slew it.

I don't seem to see your name on any list of Nobel Prize winners...

Reductio ad absurdum. If people are rational, then Wayne is rational. If
both of these are true, Wayne cannot argue that people are irrational, as
that does not follow from "people are rational" using rational methods,
and Wayne is rational.

Wayne is arguing that people are irrational. Therefore one of the two premises
is false; either people are NOT all rational, or Wayne specifically is
irrational. Either way, the point that was to be proven is shown. Q.E.D.

Exactly. You're the one assuming people are rational; one consequence of that
is that Wayne CANNOT argue that people are irrational. Not 'does not' or
'will not' or 'doesn't want to'; CANNOT. But he is doing so.

But then restricting some outcomes or choices could make the person better
off, and you've also said that can't happen! Ever!

Dave
--
\/David DeLaney posting from d...@vic.com "It's not the pot that   grows the flower
It's not the clock that slows the hour  The definition's plain for anyone to see
Love is all it takes to make a family" - R&P. VISUALIZE        HAPPYNET VRbeable<BLINK>
http://www.vic.com/~dbd/ - net.legends FAQ & Magic / I WUV you in all CAPS! --K.