Adam Smith's theory of self interest was being defended when I thought of John Nash and his theory of equilibrium. In my mind I think John Nash has the upper hand. The theory of equilibrium or game theory by Nash states: if everyone acts in their own self interest while keeping others self interests in mind too the best outcome will be achieved. The only way to achieve the best for yourself and others is to keep them in mind when you are making your decision. A clip from the movie A beautiful mind illustrates it most simply.
This is one of my favorite movies! I love how sure and excited John Nash was. And that he won the Nobel!
ReplyDeleteWhen in the movie he mentions "and for the good of the group" it reminded me of our conversation in class regarding fish. The best thing to do for the benefit of the entire group was to limit fishing so fish would exist. Oh, and by denying the chick in the movie, she only wanted him more so it was a win-win situation.
ReplyDeleteThe more I learn about economics, the more I feel I don't understand. How does a slightly insane person make the biggest breakthrough in economics since Adam Smith? How many innovative John Nashes are there in our local asylum? Can insanity be considered a type of intellectual property?
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