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Showing posts with the label global economy

Decision Making as Output and Bounded Rationality

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  The classical economics theories proceed on the assumption of rational agents. Rationality implies the economic agents undertake actions or exercise choices based on the cost-benefit analysis they undertake. The assumption further posits that there exists no information asymmetry and thus the agent is aware of all the costs and benefits associated with the choice he or she has exercised. The behavioral school contested the decision stating the decisions in practice are often irrational. Implied there is a continuous departure from rationality. Rationality in the views of the behavioral school is more an exception to the norm rather a rule. The past posts have discussed the limitations of this view by the behavioral school. Economics has often posited rationality in the context in which the choices are exercised rather than theoretical abstract view of rational action. Rational action in theory seems to be grounded in zero restraint situation yet in practice, there are numerous restra
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2020 in Retrospect

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  The year 2020 is about to fly by and we are welcoming 2021. As with any year, there would obviously be optimism as one welcomes 2021. The outgoing year has not been memorable across the human mankind. It might be one of those years which would be best left forgotten. The year 2021 is beginning with optimism and one hopes the challenges facing the existence of human mankind are overcome and a new beginning emerges. The year 2020 too was welcomed with optimism but somewhere along Wuhan in Hubei province of China, a virus was sweeping around claiming victims as it spread its tentacles far and wide. It was not that the rest of the world did not know, what perhaps was unknown the magnitude of damage it was inflicting across the city of Wuhan. China could have alerted the rest of the world but as with any other Chinese thing, they chose to remain secretive. It was a potential ruin event, to borrow from Taleb, but the World Health Organization (WHO) instead of alerting the rest of the world
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