Friday, April 13, 2007

Brad DeLong Presents a Pearl of Wisdom

by Ken Houghton

The classical finance assumptions were never reasonable first-order descriptions of investor behavior; the most that was ever claimed was that they were reasonable first-order descriptions of those components of investor behavior that did not cancel themselves out. [typo corrected; emphasis mine]

The whole post, in context, is here, and serves as a cautionary tale.

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