Post by Arlon10 on May 14, 2020 23:24:13 GMT
I agree that altruistic spending is as much in the "personal interest" of the spender as any spending considered self serving by others. That goes for utility as well. People make choices based on what is most useful from their personal perspective, which might not be considered as "useful" by other parties. While they do not maximize "utility" as defined by various schools of thought, they are in reality maximizing utility as they uniquely define it. The terminology used by my economics instructors avoids defining what utility is since that is arbitrary.
I suppose it is intuitive that there can only be one "truth." Science ceteris paribus searches for the one "right" answer to various questions. It is obvious that there is an over dependence on math and science lately to find the one "right" answer for human choices, which is ridiculous, and a bad application of science. The variety of possibilities is beyond science to manage. There are of course the bounds of morality, but within those the choices are virtually limitless.
There is a tempting efficiency in everyone making the same choices. Suppose every one wanted their own unique design on their shirts. That would be very inefficient. At the other extreme suppose everyone had to wear the same color shirt. That might save time, labor and resources, but at the cost of individual personality and expression.
The most glaring problem with limited choices is that they are made by people with average intelligence and as some people note no "perfect information." I find the choices of average people usually ill informed. That's why I am not a communist or socialist.
On the other hand people with obvious mental deficiencies might prefer the choices made by the herd, since it might work out better than their own. They assume it is "science" although applying science that way is ridiculous. There is no "one true" design of shirts.
So how do you mathematically measure how much satisfaction I get from drinking 1 bottle of coke, from the second bottle and what is marginal satisfaction from consuming each successive bottle? IMO, right from the start, economists should have taken a more normal stance than believing that people make perfect decisions and maximise their utility. So there was a bit of over-dependence on maths. But it is not something new in the field of economics. I hope we can create more realistic models in the future than unrealistic ones.
Before Adam Smith and the "law" of supply and demand many people assumed there was some "right" price that ought to be charged for items and they constructed various arguments on how to find that price. Smith blew that all away. The "right" price is the price people are "willing" to pay or sell for. Supply and demand find where those two interests meet. In other words things are worth whatever you personally choose to think they're worth. That's all the 'science" there is to it. Mostly anyway.