A Complete Theory of Human Behavior

Andrew W. Lo
MIT Sloan School of Management; National Bureau of Economic Research (NBER)
September 30, 2010

American Economic Association, Ten Years and Beyond: Economists Answer NSF’s Call for Long-Term Research Agendas

Abstract:

I propose the following grand challenge question for SBE 2020: can we develop a complete theory of human behavior that is predictive in all contexts? The motivation for this question is the fact that the different disciplines within SBE do have a common subject: Homo sapiens. Therefore, psychological, sociological, neuroscientific, and economic implications of human behavior should be mutually consistent. When they contradict each other – as they have in the context of financial decisions – this signals important learning opportunities. By confronting and attempting to reconcile inconsistencies across disciplines, we develop a more complete understanding of human behavior than any single discipline can provide. The National Science Foundation can foster this process of “consilience” in at least four ways: (1) issuing RFPs around aspects of human behavior, not around disciplines; (2) holding annual conferences where PI’s across NSF directorates present their latest research and their most challenging open questions; (3) organizing “summer camps” for NSF graduate fellowship recipients at the start of their graduate careers, where they are exposed to a broad array of research through introductory lectures by NSF PI’s; and (4) broadening the NSF grant review process to include referees from multiple disciplines.

Source: SSRN

Category: Think Tank

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One Response to “Andrew Lo: A Complete Theory of Human Behavior”

  1. davossherman@gmail.com says:

    Look: NBER was 9 months late calling the Great Recession.

    It is too effing stupid to realize how cooked GDP is (imputations, Hedonics, totally bogus deflator…), any idiot with a 3rd grade education knows that actual unemployment is 22% and that we are still in the soup, and that this is a depression.

    Why anyone would want to read any of NBERs drivel defies commons sense.

    Second to the Fed I can’t think of a larger group of clueless economic wonders.