Time to abandon group thinking in economics

Sergio Da Silva

MPRA Paper from University Library of Munich, Germany

Abstract: Group thinking is the notion that animals do those things that maximize the chance of survival of their species. It is wrong because natural selection does not favor what is good for the group or the species; it favors what is good for the individual. Here, I show through examples how group thinking also pervades economics. In connection with the fallacy of group thinking, I also discuss how economics fails to ground itself in the underlying knowledge provided by biology. I also argue that economists need to redirect their conventional approach to study group behavior. Current macroeconomics is reductionist while the route followed by biology, physics, and chemistry was to resort to a different approach when focusing on macro systems made up of a large number of heterogeneous micro units. The group level pattern self-organizes as it is not encoded directly in the individual-level rules. And here the right mathematical models can help deduce hidden connections between the interactions of individuals and the patterns that emerge at the group level.

Keywords: group thinking; biology; economics (search for similar items in EconPapers)
JEL-codes: B41 D7 Y8 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-cdm, nep-evo, nep-hme, nep-hpe and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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