Not Quite Rational Man

César Hidalgo, who directs the Collective Learning group, advocates a mind shift in economics theory: For more than a century, neoclassical theory dominated economic thinking. Neoclassical economics is a theory based on three key assumptions: individuals have rational preferences; individuals maximize utility, while firms maximize profits; and people choose independently, based on available information. As with any widely adopted theory, neoclassical economics has huge merits, but it also suffers from important shortcomings.

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