Classical economic theory suggests that free markets, in which individuals each act according to their self-interest, yield the best of all possible worlds. All one has to do is look around at places like Cuba and North Korea to see the benefits this system has provided.
But economists George Akerlof and Nobel Prize-winner Robert Shiller present a very different side to this story in their book, “Phishing for Phools.” (The “phish” is a way to get someone to make a decision that’s to the benefit of the phisher, but not to the benefit of the “phool.”) The authors observe: “Modern economics inherently fails to grapple with deception and trickery.”
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