They're not just useful concepts tho, they're how every business operates, and the concepts cover the vast majority of situations.

The behavioral economics/Freakonomics thing was like "Hey, here's this thing that might if you squint real hard fall outside of efficient market theory" and then for a decade people took that to mean that that the base concepts were worthless, which was a severe overcorrection from people that didn't understand economics.

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throwaway27448 31 minutes ago | parent | next [-]

Well yes, they're the very premise we've structured our entire economy around. How else could an economic process operate without being attacked by the state? But this is also why our market behaves so irrationally—these concepts have very obvious predictive limits that investors are struggling to grapple with and our politicians (and largely our electorate tbf) have blind faith in

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tsimionescu an hour ago | parent | prev | next [-]

The vast majority of real world businesses create prices based on cost plus systems, not on supply/demand, which are generally impossible to measure directly. Another good chunk of smaller businesses simply copy the prices of larger businesses, at least in b2c markets. Sure, if their goods are not selling, they might reduce price, but they might try other tactics as well (marketing, targeted discounts, etc).

	▲	BobaFloutist a few seconds ago \| parent \| next [-]
		I always thought of supply and demand as more defining a limit that the price approaches as the number of transactions and the size of the market approach infinity, barring structural obstacles or persistent information asymmetry to prevent it than as something that was supposed to happen immediately on any given transaction.
	▲	wrqvrwvq an hour ago \| parent \| prev [-]
		these "other tactics" are just attempts at increasing demand. Cost plus is how many business set prices but that is entirely separate from what the market decides. If cost plus is not an attractive price, it won't sell, because the demand is not there.

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wrqvrwvq an hour ago | parent | prev | next [-]

Knowledge accumulation seems to have cyclical patterns where general observations are condensed into "laws", and common wisdom is to treat these as unassailable truths. As exceptions and contradictions are found, the popular wisdom is to entirely dismiss the overwhelming universal conformity with the earlier principles because it sounds smart to common people. A lot of normal people see the basic problems with most methodological maxims but are led to believe that the maxim is truth. It takes a podcaster with a "study" to then "debunk" the "myth" they were yesterday defending as unimpeachable. People are generally not well informed enough to know anything and the podcaster class is the worst imaginable vector for knowledge dissemination or popularization. Just clickbait garbage monkeys with foreign money and vicious antisocial tendencies.

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dash2 an hour ago | parent | prev | next [-]

There are many ways that free and competitive markets can fail other than behavioural economics! Monopoly, informational asymmetry, externalities… All of these are plausibly pervasive.

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WarmWash an hour ago | parent | prev [-]

Economics is one of the scientific sore spots for liberal ideology. If you are liberal and mostly swim in liberal circles, you probably believe that economics is mostly bunk pseudoscience. Akin to conservatives and climate change

	▲	dinfinity 42 minutes ago \| parent \| next [-]
		To be fair, macroeconomics can hardly be called science, though. It is incredibly hard to falsify a lot of the theories given the lack of possibilities for experimentation. It is far closer to philosophy than to any of the even remotely hard sciences. Nothing to do with ideology, but with the nature of the field. Take epidemiological research in the areas of food and medicine: incredibly hard and expensive to get right and even then with often tenuous results. Now try doing that with ridiculously heterogeneous nations influenced by potentially almost everything on the planet. It's a small miracle that economists manage to get some useful insights out of the data, but we should definitely be aware of how weakly most of them are supported (don't start talking about "error bars" with economists).
	▲	stymaar 37 minutes ago \| parent \| prev [-]
		In fact that there's both a liberal and conservative economics ideology, and what could form a scientific discipline in between is unfortunately cornered and sorely lacking visibility.