Monkeys Exhibit the Same Economic Irrationality As Us 254
grrlscientist writes "Laurie Santos is trying to find the roots of human irrationality by watching the way our primates make decisions. This video documents a clever series of experiments in 'monkeynomics' and shows that some of the stupid decisions we make are made by our primate relatives too."
seems they've been watching government (Score:3, Funny)
Irrational Market Behavior (Score:5, Interesting)
Many of the economic theories that our governments have been adhering to over the past few decades have as a core premise that overall, markets behave rationally. Specifically, the "Efficient Market Hypothesis", in which it is proposed that the price for a good or service ALWAYS reflects ALL available information, implicitly assumes that market actors are acting rationally. And the "Efficient Market Hypothesis" is at the core of most of the mind-blowing mathematical economic models that many of our society's decision makers use to make economic decisions. The question is: If humans naturally make irrational decisions because we are biologically predisposed to do so, then how can markets be assumed to behave rationally? There have been striking experiments done on seemingly rational MBA students in which they make staggeringly irrational economic decisions. The monkey experiments seem to reinforce our predisposition to act irrationally.
In other words, the above research points towards falsifying the primary economic ideology that has been used to govern America since Reagan. This is no small matter. It affects all of our lives. And yet, if you listen to Republicans lately, they are still calling for policies derived from these economic models, policies such as tax cuts for the rich, working towards a reduction in governmental economic power, so as to let the power of the private sector and the magical invisible hand of the market place work their economic miracles. Myself, I am more of a Keynsian. I think the market is useful, but it can run amok if not attended to by a government powerful enough to guide it towards the public good.
Here is an excellent episode [pbs.org] of the TV series Nova called "Mind over Money", which lays out many of my arguments clearly. The video only streams to the US.
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Specifically, the "Efficient Market Hypothesis", in which it is proposed that the price for a good or service ALWAYS reflects ALL available information, implicitly assumes that market actors are acting rationally.
Actually, it's not a good or service that the EMH refers to, but rather the market price of publicly-traded equities, bonds and commodities in an environment in which there are relatively low transaction fees. You should read more here [wikipedia.org] before posting about it, although since you got a rating of "5" maybe only cursory knowledge is required?
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However I have seen stats that shown no matter who's policy it doesn't really effect which side is better for the Economy then the other. Because both sides are just as irrational you have to choose between giving everyone higher taxes or having businesses take that money from your pocket.
Pay the Feds or Pay the companies... You end up loosing more money then you should.
Re:Irrational Market Behavior (Score:5, Interesting)
In other words, the above research points towards falsifying the primary economic ideology that has been used to govern America since Reagan. This is no small matter.
No, it doesn't. It starts with a basic assumption that we make irrational economic decisions. You are begging the question.
"Rationality" is based on personal, usually unknowable, factors. It's impossible to prove or disprove the rationality of an economic decision since there's no way that you can take psychological factors, wants and needs into account, some of which may not even be fully known to the subject.
Re:Irrational Market Behavior (Score:5, Interesting)
Economists like Milton Friedman and his ilk would put it that in a perfect free market economy there is no such thing as a stock market bubble. There is no such thing as a housing bubble. They would say that any bubble like behavior is due to "distortions" in the market place that cause their perfect system to malfunction. They base these assertions on their assumption that the market always places the best price on a good or service based on all available information. Thus a bubble is impossible. They assume that people buy houses to satisfy their own need for accommodation and to maximize their future net worth. What they miss is that, in seeking to maximize their net worth, individual market actors, and the market itself will buy houses because the prices are going up. They will be afraid that they will be priced out of the market. They will be exuberant because they seem to be making lots of money on rising real estate prices, and they will borrow obscene amounts of money to jump into the rising market, forcing prices up even further. The prices will keep rising for a while, reinforcing the irrational belief that the inflated market is based on real supply and demand factors. Eventually, the prices crash. Since people were buying because the prices were rising, when the prices stop rising, demand dries up, causing the prices to crash.
The situation above has played out in the American real estate market. And it has played out in the stock market many times. Such behavior is inherently irrational. If the market itself, and not just the individual actors displays irrational behavior, then I would argue that the "Efficient Market Hypothesis" is falsified.
Rationality" is based on personal, usually unknowable, factors. It's impossible to prove or disprove the rationality of an economic decision since there's no way that you can take psychological factors, wants and needs into account, some of which may not even be fully known to the subject.
No. We are talking about the rationality of the market itself, and not necessarily about just the individual actors. The assumption is that the market will always set the best price based on supply and demand. The assumption is that the market price is always the most rational price based on all available information. Bubbles are irrational phenomenon. The price is going up because the price is going up. If we have built into our brains inherent irrationality, and if all actors in the market display this to some degree or another, then the market is going to act irrationally, since market behavior is just the overall behavior of all individuals.
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The market itself is the fallacy.
Company X earns Y amount of profit annually.
Company X's stock market price increases or decreases due to market perceptions.
Company X still earns Y amount of profit annually, but its its stock price reflects a different value.
Yahoo's stock price raised when Microsoft wanted to purchase them, and tanked after Yahoo's refusal to sell;
This affected stock price of Yahoo even though they still earned the same profit annually...
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The stock price may have not reflected earnings in Yahoo's case, but it did reflect something that would have a very profound impact on the company.
The stock market is sometimes based on nonsense, but a ton of factors come into play. There are times when the value does reflect profit but it still doesn't reflect the true health of the company.
Company X cuts costs and lays off staff to meet profit expectations.
Company X managed to exceed expectations.
Company X's stock value rises.
The problem is that the comp
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The real estate market is a very bad example, as it is easily one of the most distorted markets available. Consider that in the first quarter of 2010, Fannie Mae / Freddie Mac guaranteed 96.5% of new mortgages*, which is an indicator of state support of home ownership. Politically it's been a goal to extend home ownership, potentially beyond what is economically feasible.
In London, my home town, we have other problems, with restrictions on space, planning slowness, nimbyism from house owners, the large swat
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Interestingly, centralized economies such as communism are decried because they require perfect information which is then said to be unavailable.
In actuality, BOTH systems inevitably fail in different ways because perfect knowledge is unavailable.The failures or at least their effects can be reduced (probably not eliminated) by recognizing the failures and deviating from ideological purism.
Rational in the LONG RUN (Score:2)
First saying that individual can't make rational decision and so the whole market cannot be rational is like saying each of your brain cell has no intelligence and therefore you are stupid.
Then the "bubbles" (which is more of an emotionally charged word used by the people and in the media than a concrete economic definition) crash eventually is a proof that the Efficient Market Hypothesis works? The theory does not say prices won't frustrate. In fact, after the "bubbles" and "panics" of a certain commodity
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Actually I think that you are displaying the fallacy of ambiguity. Specifically, you are changing the specific meaning of the word "rational" and "irrational" (or perhaps neither of us is being explicit enough in our arguments). In this case, I have being referring to the "efficient market hypothesis" and its implication that prices of goods reflects all available information. Rationality is then a concept of price setting. It is not referring to the inherent irrationality of many of our actual market d
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But when someone buys a pair of designer jeans instead of the Costco jeans, they are buying a lot more than jeans, are they not?
They are actually buying an advertisement.
Those jeans tell the world "Hey, look, I'm successful enough that I can afford to pay more for jeans that have no greater intrinsic value than cheap jeans." As such, expensive jeans always look nicer, even when they are purposely torn and ragged, while the cheap jeans are more sturdy and whole. They look nicer because they are obviously m
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EMH reflects the notion that all information is available? I always thought that was known as "insider trading" and punishable by law.
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In other words, the above research points towards falsifying the primary economic ideology that has been used to govern America since 1787.
There, fixed that for you. And in all seriousness, Reagan's ideas weren't new. JFK did the same thing (actually, he was able to cut both taxes and spending) and so did the President back in 1920 (which staved off an ecomonic depression as well). The idea of low taxes, low spending, and few, if any, Federal regulations was a primary purpose in 1787. This is exactly why Federal powers were enumerated but State powers were not. The Founders wanted the Feds to be limited to a small set of named powers and
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Or you could get really incredibly radical and try injecting the stimulus at the bottom of the socio-economic scale for a change. That, somehow, never gets tried.
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What the above research shows is that monkeys are stupid. People do sometimes do stupid things too.
Simplistic statement, not objective, and wrong. The experiment has shown that both humans and monkeys make the same irrational economic decisions. And the results were consistent so, if it "proves monkeys are stupid" it proves the same about humans.
The reality is that in a free society, people (and businesses) have to be allowed to fail. If they don't, they never learn what they did wrong.
I the society model you are defending, only big-ass corporations and banks are allowed to fail. When the average guy fails, he loses his house and becomes an indigent.
Having a strong central government that "guides" the marketplace has never worked and always leads to high unemployment and little to no growth.
You mean, high unemployment and no growth, like... now, in the golden age of ultr
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Not so fast... perhaps the assumption here is not that people behave rationally, but instead that rational behavior is good, and ought to be rewarded, while irrational behavior i
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Did anyone else read that as "Mind over Monkey"?
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It seems the problem is that we're not idealistic enough. Instead of constantly comparing against what logic would lead us to believe to be ideal, we sometimes accept what we're surrounded with as "normal" no matter how screwed up it is. Our perceptions tend to be relative instead of absolute. Even the algorithms in software rating risk were making the assumption that normal meant okay.
We get used to our own stink. If we stare at that blueish-green cast of a c.r.t. with a weak red gun a while, it's the
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Of course Krugman knows better than you how to spend your own money.
How dare you question the wisdom of Keynesians.
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I'm not sure if that's quite the case - the economic ideology of the free market and the economic ideology of centralized control are *both* confounded by irrational humans.
Exactly so. Irrationality can be a valuable competitive trait in a stratified social climbing framework where for one primate to succeed, another has to fail. There is a constant arms race over information and intellect between individuals, generations, and groups. If a person or group behaves in a perfectly rational way (re: perfectly predictable), then it becomes easy to counter that person or group, especially if you are smarter, have better information, or greater resources to bring to bear. Irratio
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Have you played table games with girls (Settlers of Catan or something like that)? They are extremely vengeanceful! Even if it is not rational. And at the end, you have to retreat with your "cold and logical" strategy as they punish you to nonexistence. Rationality/Irrationality is a slippery definition.
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Well, the electorate chooses the legislators, and they are supposed to be chosing those of a finer clay to govern.
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The Keynesians do have one strong point in their favor: there's a lot of evidence that Keynesian spending helped during the Great Depression. I mean, look at what happened to the national debt during WWII, when the US managed to crawl out of the mess they were in:
http://upload.wikimedia.org/wikipedia/commons/3/3b/USDebt.png [wikimedia.org]
Bush and Obama haven't gone anywhere remotely near where FDR went to finance that war.
The EMH supporters, on the other hand, have not had their theories demonstrably having the effects th
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it all depends who interprets the facts - keynesianism is the mainstream doctrine so pretty much everybody believes it's the best thing that could happen to the economic thought.
Austrian school argues that the Great Depression was in fact strengthened by the intervention and only after WW2 the US got out thanks to the fact that every other major power was completely ruined during the war and the US was the only one that had production capacity intact. As a counterexample they show the recession of 1920 (whi
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I'm not sure if that's quite the case - the economic ideology of the free market and the economic ideology of centralized control are *both* confounded by irrational humans.
Well it's a bit more complicated than that, isn't it?
Because one of the ideas that has worked out pretty well for humans is the idea of careful distribution of power (checks and balances). This idea would hold that you don't want centralized power in a government or in large corporations, and in fact you actually want tension between large private organizations and large public organizations. The two can ideally balance each other out. So in this view, you want a strong market with good competition, but
Re:Irrational Market Behavior (Score:4, Interesting)
I would argue that the intellectual basis of neo-conservative economics comes mainly from the "Rational Market Hypothesis", and is thus largely based on the assumption of rationality. From the assumption of market rationality, there have been derived mathematical models that would make many mathematicians quiver. If you arranged a group of all the people in the world who actually understand these models, I suspect you could fit all of their names on a single sheet of paper (perhaps with a small font). The ideologues take the results or predictions of these models, as derived by Nobel Prize winning economists, and fit them into their ideologies. Then politicians like Reagan listen to their ideological advisors and implement their plans and models. I doubt Reagan himself had any formal understanding of economics beyond first year econ. courses.
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The intellectual basis of all economics rely on rationality of actors, Keynesianism included.
Stupid Keynesian tricks like increasing inflation above the savings rate of return rely on nominally rational actors to spend all their money and go into debt to avoid the penalty of saving money.
Unfortunately for the central planners, the American public has even more foresight than the Keynesians figure, and is willing to take the short term penalty of inflation demurrage in order to have enough savings to not get
Re:Irrational Market Behavior (Score:4, Interesting)
***The intellectual basis of all economics rely on rationality of actors, Keynesianism included.***
In no way shape or form. You need to read up on Keynesianism and to do a little work on the difference between rationality and predictability. It seems to be possible to predict behavior (especially, but not limited to, foolish behavior) without understanding it and certainly without thinking it is rational.
Re:Irrational Market Behavior (Score:5, Insightful)
And the current bubble collapse we're still suffering from, the housing market, is more adequately described as a Milton- Friedman-esque bubble. As it certainly was not produced by the Bush administration following Keynesian policies.
Re:Irrational Market Behavior (Score:5, Insightful)
Disagree that Keynesian economics relies completely on "rationality", at least as defined as "free individual rational choice". Keynesian policies such as FDR used to help the US out of the great depression
FDRs policies did not get us out of the Great Depression (which was only called that in the US). What got us out of the Great Depression was getting into a war. Pulling millions of men out of the labor market had the obvious effect of lowering unemployment.
Nobody ever got rich by spending more money than they have. If an individual can't get out of debt that way, it is irrational to believe that a nation can. In fact, no nation has ever done it and ever single nation that tries it ends up in revolution or has their money inflated out of existence.
The current bubble collapse we're experiencing was caused by policies provided by Jimmy Carter and Bill Clinton (under a Republican congress). So at least there I agree with you.
Comment removed (Score:5, Informative)
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i'd expect that the end of depression is when you are as good as you were before it happened and millions of unemployed generally agree. If for some reason GDP dropped by 95% and you had to work 50 years to get the same level back, would you call it a prosperity without precedence in the history of mankind?
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Nobody ever got rich by spending more money than they have.
Lots of bankers would disagree.
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Errata :
... we need to hit the reset button ...
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FDRs policies did not get us out of the Great Depression (which was only called that in the US). What got us out of the Great Depression was getting into a war. Pulling millions of men out of the labor market had the obvious effect of lowering unemployment.
My god, is the intellectual level of our society so low that posters can blatantly contradict themselves and not even realize it?!!
The above poster claims that FDR's programs (I am assuming he means public works expenditures) did not get us out of the Great Depression. It was the war that pulled America out instead. But what is a war, except a huge public works program, a massive series of government expenditures used to build weapons and to pay soldiers. It is indistinguishable economically from say bui
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I would argue that the intellectual basis of neo-conservative economics comes mainly from the "Rational Market Hypothesis", and is thus largely based on the assumption of rationality.
Pretty much all non-marxist economics, not just "neo-conservative economics" (whatever that is...which school exactly does that fall into, the Austria, Chicago, Keynesian?), follow the rational market hypothesis. Central control advocates (and marxists are among them) argue that they can "one-up" the market by having so-called experts dictate how much of what gets produced where and what the prices should be. They tend to have equally incomprehensible (and even more unworkable) models than the free-market
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Krugmanesque hyperkeynesianism might as well be considered Marxist.
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There are some serious problems with pure rationality.
If I owe Jim $10,000 but I can kill him and nobody will ever know, the 'rational' thing to do is kill him. Struggling to pay my debt is just a bunch of sentimentality. Only a psychopath can be purely rational.
One COULD argue that knowing that, Jim will make sure I don't have to struggle very much to pay my debt to him, but in the real world, Jim isn't that logical.
The real trouble starts when some of the actors are psychopaths and some are not.
It's called a Bonzi Scheme (Score:5, Funny)
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No wonder they'll pay us to punch the monkey, he sold them a lower branch of a fruit default swap.
Watch out: No summary (Score:2)
Not surprising (Score:2)
Rational for the species or the individual? (Score:4, Interesting)
Modern economic research shows that human beings are not primarily motivated by self interest, but by ideals of fairness and reciprocity that benefit the species as a whole. What is rational for the individual may not be what is rational for the species, and vice versa. Evolution operates on more than just an individual level, in fact what makes an individual "more competitive" in a simplistic sense might not be what gets selected for. For instance, those feelings of fairness and reciprocity most of us have. In an experimental game called the Dictator game, one person is given a large sum of money. They can give all to none of it to player B. What they do give is multiplied by a small percentage and then person B can give all to none of it back to person A, but the gift is again multiplied. Well, rational actor theory says the most rational choice for each individual is to keep ALL the money given to them. The most rational act for the species in general is for person A to give all the money to person B, and person B to give a proportional amount back, because this maximizes gains for the species as a whole. And, surprise surprise, this is close to what most people do, exchanging not all but a large chunk of the money and increasing overall reward.
Also, given imperfect information about the world, perhaps just doing what has worked up until now for your ancestors is not a bad strategy in general, especially for the less intelligent.
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Also, given imperfect information about the world, perhaps just doing what has worked up until now for your ancestors is not a bad strategy in general, especially for the less intelligent.
FWIW, that's also George Washington's argument for organized religion: "Whatever may be conceded to the influence of refined education on minds of peculiar structure, reason and experience both forbid us to expect, that national morality can prevail in exclusion of religious principle."
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No, person A does not just like gambling. There are plenty of other variations on this game that prove that. Some do use multiple rounds, but that is clearly explained to the participants. Look up game theory if you want to know more, you don't have to just speculate without any information.
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That is only one game theory experiment. In some games, players are completely anonymous and yet people still tend to behave fairly. In other games that are more like real life, like the Public Goods game, people actually incur harm to themselves in order to punish unfairness in others. The more like real life you make these games, the more fairly people behave.
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What about the experiments performed in India with rural poor, where the people did not know the experimenters, did not see each other, and the money at stake was at least a month's wages? Those seemed to show the same effect, and there was no motivation to 'look good' to anyone.
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...and there was no motivation to 'look good' to anyone.
So they used robots in India, rather than humans? Or do Indians simply not desire human approval? I'm confused by your statement.
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The test subjects were anonymous, was that so hard to pick up from 'did not know the experimenters, did not see each other?'
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But if they knew they were being tested, it would still certainly impact their behavior, which was the salient point within the thesis above.
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In that case, consider my point proven. People care more about what some random stranger they will never again see in their life thinks about them than they do about making over a month's worth of salary in one sitting. It doesn't matter why people want to be good, and of course people want to be good for selfish reasons, are there any other reasons, really? The fact is that people want to be good more than they want to be selfish.
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So long as the assumption of approval matches the desired behavior. In cases where approval attaches to undesirable behaviors, such as racism, you'd not see the benefit you're hoping to get.
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Fair enough.
Evidence that monkeys are smarter (Score:2)
You ever see a monkey with a Zune?
Re:Evidence that monkeys are smarter (Score:4, Funny)
You ever see a human with a Zune?
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Sort of:
http://tinyurl.com/c5gnb3 [tinyurl.com]
One big difference (Score:5, Insightful)
I think one significant difference between humans and monkeys, is that if you convince monkeys that little tokens can be traded for grapes, but then "suspend convertibility", they will go -- pardon the term -- apeshit.
In contrast, if you convince humans that their paper banknotes can be redeemed for an indicated quantity of gold and then suspend convertibility, they handle it pretty well.
I'm in talks with some central banks to try the experiment again...
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That's right, people still get whatever they want to purchase. That they cannot trade a certificate for a set amount of precious metals is immaterial to most people, as precious metals themselves are of li
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Well, I was trying to be funny, but since you make a substantive point:
A while back, a story here described teaching the monkeys that the tokens can be redeemed for grapes, and then the monkeys started using them as money, including for prostitution (among capuchins). In that case, the monkeys would get pretty pissed off if you "suspended convertibility", and soon they'd be smart enough to stop accepting them as payment.
Through a number of mechanisms, governments that have "suspended convertibility" of the
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Humans can't eat gold.
When humans find they can't trade the paper for food, they tend to go apeshit.
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gold is almost universal symbol of wealth, which is much more than what can be said about a piece of paper with some ink on it. Sooner or later all fiat currencies reach their intristic value of 0.
Care to guess what people used to buy food or even freedom in the times of hell known as WW2? Banknotes were worthless, precious metals and necessities of life were the only things cosidered even remotely valuable.
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That is just stupid. I can assure you that the monkeys will not care one bit if the researchers stopped giving them a piece of gold for the coin, as long as they could still get grapes.
Synopsis (Score:2)
Humans and monkeys both display two traits: A) Relativity and B) Loss Aversion
Relativity was a known. Slippery slopes work in this way. Changes are usually only compared to the immediate past, rather than on the whole.
Loss Aversion seems natural, too. We take bigger risks when losses are involved than we do gains.
So in the end it isn't necessarily noteworthy that these phenomena exist, rather that both species display the traits of them.
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Generally, given the amount of similarities (what is good in us, and also what is bad in us), it almost seems like finding some real differences is sort of more noteworthy.
Of course that would go against our usual notion of "us / them" and seeing primarily differences... (hell, we're absolutely, pardon the pun, apeshit about such trivial stuff as ethnicities; many here are even from places where just one distant ancestor can firmly place you in just his group...nvm that by such criteria we're all 100% of th
As the only /.er who actually watched the video... (Score:5, Informative)
First of all, you need to skip to minute 9 before you start getting any info. And if you read the book Super Freakonomics, you already know everything in the 20-minute video:
- Monkeys steal money from each other, as do humans.
- Monkeys are terrible savers, as are humans.
- Monkeys are poor calculators of risk/reward, as are humans. (She goes on for about 8 minutes belaboring this point.)
And the goal for us as humans is to use our logic to overcome our emotions. There, I have now saved you 20 minutes of your life!
Re:As the only /.er who actually watched the video (Score:2)
Mayeb the monkeys had a monkey government that printed up currency constantly so that their savings would actually lose them money, due to monetary inflation?
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You can instead write:
Monkeys, like humans, care more about themselves, than about society, and so will steal.
Monkeys, like humans, understand that despite the claims of absolute security, there is ALWAYS more risk than stated, so saving has some additional costs and is LESS valuable than the economicist think (i.e. among other things, there is always the chance you will die before your savi
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Try again, this time understanding what I said. The video in question spends about 15 minutes (about 10 at the beginnin and another 5 at the end) making value judgements, saying how both monkey and human, makes 'irrational' decisions. I contest these conclusions and do so without any other agenda. I am stating a simple fact that they failed to take into account - neither the monkeys nor human test subjects c
Old News (Score:2, Informative)
She published this in 2006.
Chen, M. K., Lakshminaryanan, V. & Santos, L. R. (2006). The evolution of our preferences: Evidence from capuchin monkey trading behavior. Journal of Political Economy, 114(3). 517-537
Researcher has a bias for 'smart' vs. 'stupid' (Score:2, Interesting)
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Boy you did not understand a word of that presentation, did you? Or your statement about risk indicates that exactly the mistake she is talking about is infecting your brain at so high a level that you can actually write paragraphs defending your irrationality.
She made no opinion over whether risk for a higher reward is better or worse. If you had paid the slightest bit of attention you would have seen that she presented two IDENTICAL scenarios (ie the choce between 2 grapes and a 50/50 chance of 1 or 3 gra
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QFT.
"A bird in hand is worth two in the bush." When we have a thing of value, we are not inclined to risk it.
On the other hand, "in for a penny, in for a pound." When we perceive we are losing something of value, we are much more inclined to take risk to keep it. An investor may choose to hold on too long to taking stock on the hope that its value will return.
When playing poker, amateur players will often chase large p
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There are two women, one is promiscuous the other is capricious. The latter is
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The problem is that there is no negatives in the experiment. The monkey has ZERO grapes at first, and afterward will have 2 grapes if they choose from A and either 1 or 3 grapes if they choose from B. Nobody is taking any grapes from them, they are giving the exact same number.
Both of your examples you are failing to come up with TWO pairs to choose from. A single choice is not the same experiment. Maybe your boot-kick example could be restated as:
1. In scenario one, two guys approach wearing steel-toed boo
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In any case, you know what, I'm going to take the chance of not getting kicked in the balls. Somehow I don't think that's irrational.
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Neither choice is any more risky, negative, or anything else, than the other.
Have you actually watched the video or not?
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It does not matter if there is any rational basis to choose between the scenarios. What the experiment has chosen is that depending on the initial statement of an otherwise identical choice, both monkeys and humans make a different selection.
For instance if you (rationally or not) were risk-averse, you would choose the predictable guy in both cases. If you (rationally or not) preferred maximum possible reward, you would choose the risky guy in both cases.
But what the experiment showed is that whether the gu
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I think I am not making it clear what the experiment is showing.
A way to word it so you can see the illogical nature:
Experiment 1: A will give you 2 grapes, or B will randomly either give you 1 or 3 grapes. Which do you choose?
Experiment 2: A will give you 2 grapes, or B will randomly either give you 1 or 3 grapes. Which do you choose?
For some reason both humans and monkeys will choose A in the first case and B in the second. BUT THEY ARE IDENTICAL!!!! The same wording above is not a typo, this is EXACTLY w
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If these were truly equivalent and subverting categorical instincts, that does not make it logical that one would make the same choice in both or choices equally at random. When the choice doesn't matter, the pat
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You got the wrong message.
She is simply saying that our risk aversion is completely different when we're faced with a loss rather than with a gain, even though the end result is the same. THAT is the interesting bit.
Confirmation Bias? (Score:2, Interesting)
I love reading about an experiment in which a question is posed and then the reults are interpreted strictly within the context of that specific question without considering other possible explanations for the observed behavior.
In this case, the guy on the left always cheated while the guy on the right sometimes cheated but sometimes completed the trade as advertised. So why isn't the conclusion that monkeys have a sense of fair play? So they choose not to deal with the guy who always cheats. Or maybe the
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Like the previous poster, you completely ignored the fact that the monkeys (and humans) made the complete OPPOSITE choice based on an actually irrelevant difference: whether the guys were holding 1 or 3 grapes initially. The results and cheating are EXACTLY the same, yet they made the OPPOSITE choice based on what is actually something that has nothing to do with the outcome!
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Because you are saying that in one case a guy is "cheating" when in fact he is doing EXACTLY THE SAME THING in both cases. If you think one is "cheating" and the other is not, then you are subject to exactly the same irrationality as the monkeys.
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The reason is because the monkeys made OPPOSITE choices in the two scenarios. In both cases A would give 2 grapes always and B would give 1 or 3 grapes. Whether you call one of them "cheating", the choice should be the SAME in both scenarios. However the difference is that initially both are holding 1 grape in one scenario, and holding 3 grapes in the other one. This seems to change the choice (whether that choice is processed by the brain as "cheating" or any other logic) from one to the other, despite the
For a second I thought... (Score:2)
Why? Do they get Best Buy extended warranties too? (Score:3, Funny)
Nah. That would require me to RTFA.
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I always laugh at these insults (Score:3, Interesting)
No. The decisions you think are "irrational" are often in fact VERY rational - based on a 'wider' world.
For example, the gambling thing does not consider TRUSTWORTHYNESS.
Taking the gamble that the odds say is good, assumes the odds are accurate. Once you understand that the gamble may be a con and the gamble may be fake, then YES, you should treat the 50/50 chance to gain as less interesting than the 50/50 chance to lose.
This means the the 'absolute" bias, and Loss Aversion are NOT stupid irrationalities, but in fact a logical decision due to the knowledge that people are liars and cheats.
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Monkeys Pay for Sex (Score:2)
Monkeys Pay for Sex [google.com]
It goes without saying that we're talking about male monkeys.
Re:Meh. (Score:5, Funny)
So they buy Apples too, huh?
Yeah, I think I saw a monkey holding a phone in a weird fashion the other day.
And another monkey reading a book on objective C.
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Or,
Monkeys exhibit the same economic irrationality as the US.
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Signficance nitpick: it doesn't matter.
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And why should the gorillas have to climb a tree to give a monkey a banana? The monkeys should stop being so lazy and get off of banana welfare! See, this is what happens in social banana republics - all of the good bananas get offshored! If these monkeys really wanted a banana that badly, they'd move to Zimbabwe to be where the bananas are! But noooooo, they just expect the zookeepers to keep bringing th
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The s-word seems ever more scary lately?