Economics bits

Clay Shirky clay@shirky.com
Tue, 23 Oct 2001 15:32:54 -0400 (EDT)


As regards the long-running debate about the collision between
classical economics and human behavior, there are some interesting
bits out of MIT and BU:

  "Like bond traders and stockbrokers, foreign-currency traders are
  paid to act rationally - to ignore the waves of emotion that consume
  amateur investors. Yet all of the currency traders in the new study
  showed a clear physiological response to what the markets did,
  experiencing powerful surges - jumps in blood flow, sweating - with
  every rally and reverse. A strong emotional reaction was clear in
  regions far from the rational mind."

http://www.boston.com/dailyglobe2/296/science/The_biology_of_irrational_exuberance_+.shtml

-clay