Intro to Bounded Self Interest

Intro to Bounded Self Interest - PPE 203/PSYC 265 Lecture...

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Unformatted text preview: PPE 203/PSYC 265 Lecture for 3/29/12 Homo economicus is often described as rational and: c Completely/totally/incorrigibly selfish elf terested c Self-interested c Profit-maximizing c Money-maximizing c In what way is selfishness integral to rationality? Generosity puzzles We could weaken our definition to say that homo economicus maximizes present aims, whatever they may be, but this has its problems, too. c The crankcase oil problem Social preferences c Concern for more than our narrow self-interest can lead to several anomalies for orthodox theory c People refuse/resent prices that reflect supply & demand and leave them with surplus c Third parties may prevent others from trading c People may cooperate when not cooperating is dominant Of the 3 sections, bounded self- interest gets by far the least attention. Perhaps one reason is that, opposed to earlier sections that dealt with a ormative model, economics holds no normative model, economics holds no default ethical position. What is the normative model from which to deviate (if not selfishness)?-you can, however, be inconsistent with your own principles; framing matters in this section just like everywhere else Ethics of economics c Respect for transactors people are capable of choosing for themselves c Respect for peoples preferences c Treat all market demands equally A shipment containing 12 grapefruits and 12 avocados is to be distributed between Jones and Smith....
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This note was uploaded on 04/04/2012 for the course PSYC 265 taught by Professor Jasondana during the Spring '12 term at UPenn.

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Intro to Bounded Self Interest - PPE 203/PSYC 265 Lecture...

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