Richard Thaler
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Podcast Appearances
You pick up a big economics textbook, you'll not see the word people.
There are agents.
And these agents are kind of like Spock in the old Star Trek series.
Logical.
Very logical and maximizing.
They're as smart as the smartest economist.
And they do that in part because that's the easiest kind of model to write down.
It works out simple.
Right.
I mean, suppose you tried to write down a model of John wandering through Costco and
choosing the optimal stuff to put in a basket, right?
I mean, no one can solve that problem.
It's too hard.
So you simplify the modeling task by saying, okay, he's going to choose the best bundle.
And that, the math is easy.
And then they add to that an assumption that people are selfish jerks.
Yeah.
Okay.
So the idea is, well, what if we introduce some people?
Because there are people run firms, people interact in markets.