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 Originally Posted by a500lbgorilla
Said like a fact, but qualified by *according to our best models. Models built upon the assumption that people act rationally.
People don't seem to act rationally. So I doubt the original fact.
People do act rationally, just not perfectly. Rationality in economics is a little different than how we use it colloquially. Colloquially, we think of it as wisdom, but in economics it isn't necessarily about wisdom, but more about cause and effect and perhaps accountability.
Capitalism indeed allocates capital better than socialism because the decision-making is more consequential
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