Welcome back you bunch of HomoEconomicus! Today, we will delve into the history and importance of your natural economic selves. Become a true HomoEconomicus by joining the Diegonomics family below!
Classical vs. Behavioral
The HomoEconomicus is simply a term used to describe the ‘economic man’: a rational human being that always aims to maximize its utility (satisfaction). This utility can be maximized in monetary or non-monetary situations. Classical economists have used this ‘rational’ actor, so as to create models and prove theories. However, behavioral economists (like our great friend Daniel Kahneman) and
So, does the HomoEconomicus still walk among us? Or was it killed when the behavioral economists crashed into the Earth?
Well… yes and also no. Why? The HomoEconomicus is the foundation for basic economics and so in a sense, it is immune to extinction. Therefore, our ability to understand human economic actions would be impossible without
On the other hand, this revered discipline is becoming intertwined with: law, neurology, psychology, sociology, anthropology and a bunch of other -ologies. Consequently, the concept of a pure HomoEconomicus is constantly being debated and reformulated. The classical theory will become diluted as more scholars unveil the ‘predictable irrationality’ of the human being as well as what drives it.
The Future of the HomoEconomicus
It will not become extinct, but its current denomination will very much forge into something entirely new as we expand our knowledge of human consciousness. Currently, humans are described as partly HomoEconomicus and partly HomoEmotionalis (more emotional, social and prone to biases). However, the exact percentage of each is entirely unclear and will continue to spark lively debates for decades to come!
May the ECON be with you
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