"Vernon Smith started a series of experiments to see whether basic predictions of the standard economic model about markets would prove correct. [...] Basically, the predictions proved good. A stunning result! Maybe, therefore, it doesn't matter if people are not like homo oeconomicus; the standard economic model can still work." (quote shortened, source: Edward Cartwright in his textbook "Behavioral Economics" (3rd edition, p. 8)).
"Vernon Smith started a series of experiments to see whether basic predictions of the standard economic model about markets would prove correct. [...] Basically, the predictions proved good. A stunning result! Maybe, therefore, it doesn't matter if people are not like homo oeconomicus; the standard economic model can still work." (quote shortened, source: Edward Cartwright in his textbook "Behavioral Economics" (3rd edition, p. 8)).
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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!["Vernon Smith started a series of experiments to see whether basic predictions of the
standard economic model about markets would prove correct. [...] Basically, the
predictions proved good. A stunning result! Maybe, therefore, it doesn't matter if people
are not like homo oeconomicus; the standard economic model can still work." (quote
shortened, source: Edward Cartwright in his textbook "Behavioral Economics" (3rd
edition, p. 8)).
What kind of criticism of the standard economics model does Cartwright refer to? Explain
why Vernon's findings can be used to support and uphold the standard model of
microeconomics despite unrealistic assumptions?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2f5a5c57-3c9f-4143-bcc6-2d8434aaf2b7%2Fa6277cee-f56f-4762-bf6b-179556f8a89c%2F7yvzu6y_processed.jpeg&w=3840&q=75)
Transcribed Image Text:"Vernon Smith started a series of experiments to see whether basic predictions of the
standard economic model about markets would prove correct. [...] Basically, the
predictions proved good. A stunning result! Maybe, therefore, it doesn't matter if people
are not like homo oeconomicus; the standard economic model can still work." (quote
shortened, source: Edward Cartwright in his textbook "Behavioral Economics" (3rd
edition, p. 8)).
What kind of criticism of the standard economics model does Cartwright refer to? Explain
why Vernon's findings can be used to support and uphold the standard model of
microeconomics despite unrealistic assumptions?
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