In 2011, Edward Cartwright, a Behavioral Economist, Gave Credit to the Nobel

question 85

Multiple Choice

In 2011, Edward Cartwright, a behavioral economist, gave credit to the Nobel Prize-winning economist Herbert Simon for launching what Cartwright calls the "you cannot be serious attack" on the standard economic model. Cartwright cites a paper published by Simon in 1955 where the author uses the standard economic model to solve elegantly how a rational person should behave. After solving an equation for this rational person's optimal behavior, Simon states: My first empirical proposition is that there is a complete lack of evidence that, in actual human choice situations of any complexity, these computations can be, or are in fact, performed.
Source: "A Behavior Model of Rational Choice." The Quarterly Journal of Economics (1955) , page 104.
This statement by Simon can be best described as a call to:

• A) governments for increased education spending so that more decision-makers can and will perform the computations that Simon is referring to.
• B) citizens to do their part to reduce the complexity of all human choice situations.
• C) economists to replace Homo economicus in economic thinking with something more humanlike.
• D) economists to continue to use Homo economicus to guide their understanding of the complex nature of human decision-making.
• E) the United States Department of Economic Rationality to impose a new bylaw prohibiting the use of the standard economic model in academic research papers.

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