Understanding Reasonable Actors
An excerpt from "Overcoming Ideology: Bridging the Divide Between the Secular Left and the Religious Right" Is it reasonable to believe that Man-made Global Warming is vast hoax propagated by the Chinese in order to subvert the American economy and promote Communism? When trying to determine what is “reasonable,” we first must realize that reasonableness has nothing at all to do with rationality. Despite what classical economic models posit, most of the time, people don’t behave rationally. According to Hersh Shefrin, professor of behavioral economics and Chair in the Department of Finance at the Leavey School of Business, people make 95% of their decisions based on heuristics, mental shortcuts or “rules of thumb” (Shefrin, 2012). Each day, a person is required to make hundreds of individual decisions some mundane and some important. By relying on heuristics, people can make decisions and feel confident that their choices are correct. This confidence is rooted in
