“All rational action is economic. All economic activity is rational action. All rational action is in the first place individual action. Only the individual thinks. Only the individual reasons. Only the individual acts.” – Ludwig von Mises
The Editors’ Quote of the Day:
“All rational action is economic. All economic activity is rational action.”
Wrong.
As Robert Heinlein once observed, “Man is not a rational animal; he is a rationalizing animal.” Anyone who has been alive along enough to observe the every-4-or-8-year ritual of Americans either slapping on or scraping off their “Dissent Is The Highest Form Of Patriotism” bumper stickers enough times understands this.
There’s been a lot of advancement in behavioral science, game theory, psychology, etc. since 1940; and even since 1957 when “Atlas Shrugged” was published.
In fact there’s a whole field of economics that has emerged since then called Behavioral Economics — as opposed to the Classical Economics of von Mises, Hayek, Friedman, Rand, etc.
Homo Economicus is as stupid of an economic model as Homo Sovieticus was.