RE:Re: Gary Mongiovi on assuming rationality

["Javier Finkman" <finkman@xxxxxxxxxxxxx>]

In the top of my memory (but to lazy to get the exact references), I remember two papers, from Alchian and from Gary Becker, were they derived order from random behavior. For example, Becker derived a downward sloping demand curve. In addition, I remember a paper from Arrow suggesting that you might rationalize many of the predicitons of neoclassical theory with a theory of habit formation (not rational in the neoclassical sense, of course). So I guess that the we should not be scared of departing from rationality. By the way, that is exactly the merit of Mr. Kahneman which did not limit to empirical work but also developed a whole alternative decision theory (prospect theory).

Paul, a very respectful comment: though I do agree about the role of uncertainty in an essential -keynesian?- way, I am still uncomfortable by your implied division of those who agree with the ergodic axiom and those who don´t. True, I do not know much about the ergodic axiom but I still find very useful economics without it.

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