Rethinking Rationality
Explore the limitations of traditional notions of rationality in economics and behavioral economics. Mervyn challenges the conformity to certain axioms and argues that what are often labeled as biases are actually evolutionary adaptations to an uncertain world. Russ raises the issue of sunk costs and how economists need to reconsider their assumptions in light of people's resistance to treating them as sunk.In this clip
From this podcast
EconTalk
John Kay and Mervyn King on Radical Uncertainty
Related Questions
What are sunk costs in the context of the episode Mary Hirschfeld on Economics, Culture, and Aquinas and the Market and the clip Understanding Sunk Costs?
What is the sunk cost fallacy as discussed in the episode The Weird Science Behind Your Irrational Money Decisions #443 and the clip Cutting Your Losses?