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Alina Stefania Chenic (cretu) (), Silvia Mărginean (), Adrian Miron () and Speranta Pîrciog ()
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Alina Stefania Chenic (cretu): Academy of Economic Studies, Bucharest, Romania
Adrian Miron: University of Medicine and Pharmacy “Carol Davila”, Bucharest
Speranta Pîrciog: INCSMPS Scientific Director, Bucharest, Romania

Annals - Economic and Administrative Series -, 2013, vol. 7, issue 1, 3-22

Abstract: One of the famous and sarcastic "Laws of Murphy" says: "when things go too well, it means that something is wrong!" This happened until the years 2007-2008 – spectacular economic growth, some of which seemed highly unlikely – even if sometimes well-being seemed suspicious and somewhat incomprehensible to many of us! So after almost 80 years since the "Great Depression" of 1929-1933, the civilized world faces a new – carbon copy – crisis but in terms of incomparable globalization of the economy. We rightly ask ourselves: "Why study economics if – with some notable exceptions – the academic elite has not strongly warned us about this danger, especially if, once triggered, this crisis can no longer be controlled and stabilized?" Probably – many economists now say, especially supporters of emerging sectors of the economy, namely behavioural economics – classical economics, although perfectly constructed, conceptually speaking, overlook an element of detail that is absolutely essential. Namely that economics is an exact science but also a social science, not a material one, that addresses men. Their imperfection in all areas, including the economic life, makes them vulnerable and frequently irrational. Such economic behaviour – irrational, yet predictable – makes the entire logical structure of the economy give in shamefully. Economics should take into account the actual patterns of human behaviour in the decision-making system in the economic and financial life, not ideal patterns. Based on these considerations, we must understand as precisely and profoundly as possible the actual decision-making system in the human brain in general and especially the human decision-making system in the economic and financial area; area which is of maximum interest and sensitivity. Almost any careful and thorough analysis we make, we find the presence of irrational decisions in individuals and human communities, especially long-term and/or global decisions. Therefore it would be good to understand and explain the actual mechanisms that can lead to very serious – sometimes catastrophic – macro economic disturbances, how to recognize and how to avoid them!

Keywords: classical economics; behavioural economics; economic behaviour; economic and financial crisis; rational/irrational human behaviour (search for similar items in EconPapers)
Date: 2013
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