Anti-Capitalist Sentiment (with some morality)

[CoccoBill]

I may totally be wrong, actually it wouldn't even surprise me much if I had something about the concept totally backwards. Still, what I meant with my criticism of it is that it assumes that people make the decisions that are best for them, to maximize their personal utility. If all humans were vulcans with godly intellect and complete information related to their decisions (that is, enough information and understanding to be able to not only weigh in all the factors, but also identify all false and deceitful information given to them) then yes, I'm sure free markets would work perfectly and all superficial regulation would only be a hindrance. This is hardly the case though, people have very incomplete and often misleading information available to them, limited capabilities to assess the data and a poor understanding of the effects of their choices. It's not (only) about the correctness of their values, but people regularly act against their values, either through ignorance or deceit.

[Renton]

I may totally be wrong, actually it wouldn't even surprise me much if I had something about the concept totally backwards. Still, what I meant with my criticism of it is that it assumes that people make the decisions that are best for them, to maximize their personal utility. If all humans were vulcans with godly intellect and complete information related to their decisions (that is, enough information and understanding to be able to not only weigh in all the factors, but also identify all false and deceitful information given to them) then yes, I'm sure free markets would work perfectly and all superficial regulation would only be a hindrance. This is hardly the case though, people have very incomplete and often misleading information available to them, limited capabilities to assess the data and a poor understanding of the effects of their choices. It's not (only) about the correctness of their values, but people regularly act against their values, either through ignorance or deceit.

I think you're using the traditional definition of rationality, and not the one used by rational choice theory, which is more of a subjective rationality. Either way, it is not vital to functioning capitalism that people make max-utility choices. Capitalism applies economic pressure to everyone in the system to TREND toward higher utility choices, and it does so much better than laws do.

[wufwugy]

I may totally be wrong, actually it wouldn't even surprise me much if I had something about the concept totally backwards. Still, what I meant with my criticism of it is that it assumes that people make the decisions that are best for them, to maximize their personal utility. If all humans were vulcans with godly intellect and complete information related to their decisions (that is, enough information and understanding to be able to not only weigh in all the factors, but also identify all false and deceitful information given to them)

This is how it is. Economists try to understand this.

then yes, I'm sure free markets would work perfectly and all superficial regulation would only be a hindrance. This is hardly the case though, people have very incomplete and often misleading information available to them, limited capabilities to assess the data and a poor understanding of the effects of their choices. It's not (only) about the correctness of their values, but people regularly act against their values, either through ignorance or deceit.

Keep in mind that regulation are every bit as much a facet of rationality/irrationality and economics as markets are. If you claim people act irrationally in markets, you also need to claim they act irrationally with regulations. Really, the underlying reason markets work is because they don't solidify irrational behavior like regulations do.


Outside of that, rationality has a ton of applicability that isn't seen from the lay. For example, financial markets react about as rationally as possible to behavior of central banks. None of this stuff makes sense on the individual level, and it's more related to the wisdom of the crowds type of thing.