John Nash on unsound game theory

7 Oct, 2017 at 10:18 | Posted in Economics | 3 Comments

 

What John Nash (!) says underlines the very fundamental methodological weakness of game theory and neoclassical mainstream economics at large. Overemphasizing​ the reach of instrumental rationality and abstracting​ away from the influence of non-economic factors, reduces the analysis to a pure thought experiment without any substantial connection to reality​. Limiting theoretical economic analysis in this way — not incorporating both motivational and institutional factors when trying to explain human behaviour​ — makes economics insensitive to social​ facts, and thus useless.

Economic relations are always embedded in socio-cultural contexts​. Not taking account of that, economics will never be able to come up with useful and relevant explanations. ​

3 Comments

  1. “Nonsensforskning
    Har universiteten reducerats till betygsproducerande fabriker? Mats Alvesson hävdar att mycket av dagens samhällsforskning är meningslös. Här samtalar han med Ebba Lisberg Jensen och Tapio Salonen.” http://sverigesradio.se/sida/avsnitt/954064?programid=793

    Comment by Jan Milch— 8 Oct, 2017 #

  2. Amadae, ‘Prisoners of Reason’ is very interesting on this

    Comment by Jonathan Perraton— 7 Oct, 2017 #

  3. Then redesign ‘Game Theory’ so, that it can describe co-operative behavior.
    In a sense that 1 input plus 1 input can give 3 output.
    (The old theory is answering how something would/should be shared. It’s about sharing NOT building something new.)

    Comment by Peter Bretscher— 7 Oct, 2017 #


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