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Linked with Linkedin conversation:

March 18, 2012

I initiated a discussion in Linkedin that some of you may find useful: I left on October 12, 2011 for an amazingly successful four months cancer treatment in Germany and what hit me was an article in the Financial Times from Monday, October 17, 2011 placed on my desk.

“Irrational Regard for Economic Models” by James Mackintosh. He writes, “Perhaps the funniest moment in the history of the economics Nobel award of the 1997 prize to Myron Scholes and Bob Merton. Both were brilliant economists but their reputation suffered the following year when Long Term Capital Management, the high-flying hedge fund they helped run, crushed and burned.”

Would be great if you can read the whole interaction in Linkedin itself. It will imprint in your mind that there are two opposing economic systems in the world; Classical and Behavioral. The classical economic system gives us recessions, high unemployment and Nobel prize awards to economists who have wrong assumptions about how humans behave in the market
place. How do we, behavioral economists, make sure that we do better?

The fourth annual meeting of the four-year old academy of behavioral economics is in New York City this September. Join if you are a social scientist or a person who wants the best financial system for your country and yourself! Very few times in history the wave of the future shows up so clearly on your door step.

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