Behavioral economics has produced no empirical or theoretical payoff for macroeconomics

Evidence

The problem with behavioral economists going gaga over “irrationality” was that they conflated that incredibly complex and tortured phenomenon with minor divergences from their own overly rigid construct of pure deterministic maximization of an independent invariant “well-behaved” utility function. Akerlof and Shiller could only condone an incongruously rationalist framing of their irrational exuberance. Two decades of such behavioral research certainly has not resulted in any consensus systematic revisions of microeconomics, much less macroeconomics. Perhaps even more damning, the conventional sadomasochistic excuse that individuals would learn under pain of loss to behave like neoliberal agents was also unavailing: “almost no empirical evidence exists documenting that individuals who deviate from economic axioms of internal consistency (e.g., transitive preferences, expected utility axioms, and Bayesian beliefs) actually suffer any economic losses.” — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 734

Categorization

• XREF: Connects to the broader ‘thought collective’ critique — behavioral economics as a failed competitor to the neoliberal orthodoxy the reader is tracing across institutions. — connects to: Empirical failure does not dislodge orthodox economists from their theory — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 722; Behavioral economics produced no crisis warnings because its practitioners avoided macroeconomics — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 735

Broader Connections

• Behavioral economics produced no crisis warnings because its practitioners avoided macroeconomics #expands (0.80) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 735