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Economic complexities and cognitive hurdles: Accounting for specific economic misconceptions without an ultimate cause

  • David Leiser (a1) and Yhonatan Shemesh (a1)
Abstract

Do folk-economic beliefs have an ultimate cause? We argue that, in many cases, the answer is negative. Cognition is constrained in both scope (via long-term memory [LTM]) and depth (via working memory [WM]). Consequently, laypeople are challenged by concepts essential for understanding complex systems, economics included: aggregation, indirect causation, and equilibrium. We discuss several economic misconceptions arising from this acute mismatch.

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Behavioral and Brain Sciences
  • ISSN: 0140-525X
  • EISSN: 1469-1825
  • URL: /core/journals/behavioral-and-brain-sciences
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