rational
- people are on the whole insane, individually and collectively
- in the sense that the way they act and what they believe is not reflective of an underlying reality
- people are unable to express their own preferences, and often hold contradictory preferences without noticing
- in economics there is the idea of ‘revealed preferences’ but seldom is the consitency of preferences examined
- both stated and revealed preferences vary wildly depending on context
- because people are insane, the idea that they ‘respond to incentives’ is obviously wrong
- people will ratioanlize their decisions in terms of what incentives they believe led to their decision, but rarely can people describe which factors will influence their decision in advance
- often choices must be made among nearly identical options, and under these circumstances the decision however consequential is made essentially at random
- you have spooks in your brain