Economic Theory

Mark Thoma has an analysis of "The Autistic Economist" by Alcorn and Solarz, Yale Economic Review. The review with Mark’s comments need to be read as all, criticisms and counter-defense, both hold sway in the discussion. One basic failure of Economics as presently presented consists of Economist description of Markets in the first place. They discuss the possibilities of Choice between different Products, and the range over which that Choice can be made. They fall short in analysis of the development of that Choice.

Participants in a Market have already chosen what part of the overall Market in which they would produce or consume. The Producer has made an evaluation of his skills, resources, and his affinity to the production process. The Consumer has already spent a lifetime developing his Choice pattern based upon his needs, his desires, and how he wishes to allocate his Income. The Advertizer attempts to seduce the Consumer away from his previous Choice pattern with sensuous creation of new desires within the Consumer, or attempts to create Consumer desires for superior products with substituted effect. Markets drop from the position of being a vast monolith by the function process, and the Invisible Hand truly disappears to be replaced by quite normal human interaction.

Economists confuse themselves as much as Others, by examining their models and finding variations from their projections; concluding there is some unknown Variable not yet defined. It is simply the traditional battle between Tradition and Progression. Neither Producer or Advertizer possess assurance of at what exact point Consumer preference will change. No Consumer can define exactly when Producers will match their Income allocation range; the reason why Store Sales are such a vital element within the Consumer Buying pattern. Economics and Economists find failure only in their ‘trying to worry the bone’ too much. lgl