Post-crisis behavioral economics reduced Keynes to irrationality that disrupts general equilibrium.
Evidence
Some economists who had been strong advocates of behavioral approaches prior to the crash, such as Robert Shiller and Robert Frank, leaped in with op-eds essentially blaming the entire crisis on native cognitive weaknesses of market participants. This line became entrenched with the appearance of George Akerlof and Robert Shiller’s Animal Spirits: displaying an utter contempt for the history of economic thought, they “reduced” the message of Keynes’s General Theory to the proposition that people get a little irrational from time to time, and thus push the system away from full neoclassical general equilibrium. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 729
Categorization
- SEED: Angle: how behavioral economics functioned as ideological cover for orthodoxy by absorbing the crisis narrative into cognitive micro-deficits rather than systemic failure.
- XREF: connects to: Post-1980 economists selectively adopt psychological doctrines that reinforce neoclassical orthodoxy. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 2207; Behavioral economics repackaged government intervention during the neoliberal era — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 346; Behavioral economics gets coopted to excuse rather than reform orthodox theory — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 745 (+3 more)
Broader Connections
- Behavioral economics gets coopted to excuse rather than reform orthodox theory
#exemplifies(0.85) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 745 - Behavioral economics repackaged government intervention during the neoliberal era
#qualifies(0.80) — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 346 - Behavioral economics offers the sensation of reform without reform
#corroborates(0.80) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 746