"Emotions and Economics" ... the title sounds funny but delve deeper and you will be able to relate the two.
Emotions fit the optimization theory, When there is a great emotional backup, you dont care. You spend lavishly and help others to increase their pool !! On the other hand, when your emotional constraint (like the income constraint) falls short ... you try and minimize your spending ...
Times come where there is nothing left in your emotional pool and you fall back to the threshold .. you start looking for external agents for providing the emotional cushion like borrowing in economics ... If you pay back in interest to these so called external agents who become a part of the system now, then you are an ideal economic agent (Adam Smith), and if you dont ... then you are the frugal kinds. So the paradox of thriftiness (thriftiness implies more saving that may not get invested, less consumption in the following periods,lower aggregate demand and therefore lesser agg national income) applies. Thus the more frugal you are, less you will earn back in terms of love, support etc ... Anyway ... the external agents help you to build some base ..
After rejuvenating the depleted source, you start looking for fresh investing zones !! again you would want to invest you emotions where you feel its worth it and returns will be good enuf .. so you start planning .. basically the blue print for future emotions .. the rosy picture dies soon .. when you see that its not always the free invisible hand working for the development of all ... there are circumstances that get created .. beyond your surveillance, and screw up the entire blue print ... and then theres a reality check .. you investment has no returns .. in fact to your disbelief it rendered negative returns ...
But wait a sec ... here is the caveat like the theory in economics states ... investments are definitely risky as there is no fixed pattern .. u invest and fail once, twice, thrice .. but soon you will be able to find how the market works .. and you would invest and spend ur emotions (income) according to market forces .. not just according to your own calculations ... and surely ... will be in a win win situation someday ..
So, in case you feel you wasted your emotions over someone or somewhere ... don't forget that its a process ... of making you competitive .. in the society ( market economy) and every such experience will only increase you efficiency to optimize your constraints ... and you will monopolize some day .. !!
Some emotions are dictative in nature, some are submissive ... nevertheless .. always express them ... hiding them is no solution ...
Emotions fit the optimization theory, When there is a great emotional backup, you dont care. You spend lavishly and help others to increase their pool !! On the other hand, when your emotional constraint (like the income constraint) falls short ... you try and minimize your spending ...
Times come where there is nothing left in your emotional pool and you fall back to the threshold .. you start looking for external agents for providing the emotional cushion like borrowing in economics ... If you pay back in interest to these so called external agents who become a part of the system now, then you are an ideal economic agent (Adam Smith), and if you dont ... then you are the frugal kinds. So the paradox of thriftiness (thriftiness implies more saving that may not get invested, less consumption in the following periods,lower aggregate demand and therefore lesser agg national income) applies. Thus the more frugal you are, less you will earn back in terms of love, support etc ... Anyway ... the external agents help you to build some base ..
After rejuvenating the depleted source, you start looking for fresh investing zones !! again you would want to invest you emotions where you feel its worth it and returns will be good enuf .. so you start planning .. basically the blue print for future emotions .. the rosy picture dies soon .. when you see that its not always the free invisible hand working for the development of all ... there are circumstances that get created .. beyond your surveillance, and screw up the entire blue print ... and then theres a reality check .. you investment has no returns .. in fact to your disbelief it rendered negative returns ...
But wait a sec ... here is the caveat like the theory in economics states ... investments are definitely risky as there is no fixed pattern .. u invest and fail once, twice, thrice .. but soon you will be able to find how the market works .. and you would invest and spend ur emotions (income) according to market forces .. not just according to your own calculations ... and surely ... will be in a win win situation someday ..
So, in case you feel you wasted your emotions over someone or somewhere ... don't forget that its a process ... of making you competitive .. in the society ( market economy) and every such experience will only increase you efficiency to optimize your constraints ... and you will monopolize some day .. !!
Some emotions are dictative in nature, some are submissive ... nevertheless .. always express them ... hiding them is no solution ...
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