Reply To: "Independence of Irrelevant Alternatives"…..hmmmm

#21824

Lie isn’t my point, but if they for example think that the choice is Chocolate and Vanilla, they might like them both very similarly, but enjoy chocolate just a tad more and so select it.

But lets now say that the choice of Strawberry were thrown into the mix….what if it was generally known that when there are these three “candidates” in the running that the population preferences were very closely split between Strawberry and Vanilla with Chocolate being a distant third…..and if they did not like Strawberry nearly as much as either Chocolate or Vanilla (which between the two, they only slightly favored Chocolate)…..they might very well change their selection to vanilla knowing that doing so is more likely to get them some thing they desire vs something they do not.

I know what you said…..they are not “voting”, but if they realize that are taking part in some sort of selection process, vote or not, they will operate in a manner that get them what is in their self-interest.

I suppose I am mixing apples and oranges…..or maybe just polluting a theoretical over simplistic scenario with what I think are more typical real-world issues…..but I suppose this is my problem with economic theory as far as I understand it…..it seems to rely on static calculus….to me there seems to be a very large component effecting things from the “moving parts” and how fast and far they move. (working on speculation, fear, greed and the like)

That is why I made a comment a while back about simulating things more like electronic circuits….for example, to me the economy is always adjusting…..so either it is always in equilibrium or it is NEVER actually in equilibrium…..I think the former, unless the change comes from some sort of genuine shock, and I don’t exactly know how to “quantify” that sort of stimulus.