Friday, January 8, 2010

Economist's Behavior

A Wall Street Journal article on the behavior of economists gives a lot of examples suggesting that economists are cheap. I do not disagree with this overall conclusion, it may in fact may simply be a self-selection issue. In other words, many individuals choose to major/study economics since it re-enforces or justifies their own personal worldview which some would call "being cheap". What I do take exception to, is that the article emphasizes the issue from the "glass is half-empty" viewpoint.

Rather than viewing economists as "being cheap", how about as Betsey Stevenson mentions in the article above, that economists are concerned about losses in efficiency. Given the recent economic environment, I think it is a virtue to spend your income wisely - some would call this efficiently, and if that means negotiating for lower prices, waiting for sales or not paying more for the color of a car, and using the extra income to purchase other goods/services or save that money, I think that this is admirable behavior. Given the amount of credit card debt, and amount of individuals hurt financially over the last few years, maybe viewing such behavior from the "glass is half-full" approach should be encouraged. While I am not defending all the practices mentioned in the article, I think a little restraint is wise behavior.

Finally to me, one of the values of an economic perspective is to look at behavior issues from multiple sides, even if some are not really all that cool or socially popular. Maybe that is just me.

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