Behavioral economics operates on the assumption that human emotions play an important role in determining economic choices. However, while all of us have emotions, we ultimately use reason to determine what we need to sustain our lives.
Economists are fond of claiming that employing data and statistical analysis is actually “doing economics.” No, they are “doing data” and nothing more. Real economics employs real theories that explain economic phenomena.
When Adam Smith and the English classicals promoted division of labor as the most important ingredient in economic development, it took Carl Menger and his Austrian successors to point out that error and promote the proper economic theory of production.
Scott R. Sehon tries to be intellectually honest in his critique of capitalism and his endorsement of socialism, but David Gordon writes that Sehon needs to better know the arguments favoring capitalism.
Since Adam Smith, economic thinkers have failed to understand that profits in a market economy are not extractions of wealth from laborers. In truth, profits lead to higher wages and higher living standards for those workers.
There is a lack of buyers for US Treasury debt. Rating agencies have recently downgraded the US debt, and entitlement benefits’ “trust funds” will go into the red in a few years. The classical economists offer few answers to the depth of this problem.