George A. Akerlof QUOTES

1 " There was money to be made giving all these people what they thought they wanted. "

2 " The economic system is filled with trickery, and everyone needs to know that. We all have to navigate this system in order to maintain our dignity and integrity, and we all have to find inspiration to go on despite craziness all around us. We wrote this book for consumers, who need to be vigilant against a multitude of tricks played on them. We wrote it for businesspeople, who feel depressed at the cynicism of some of their colleagues and trapped into following suit out of economic necessity. We wrote it for government officials, who undertake the usually thankless task of regulating business. We wrote it for the volunteers, the philanthropists, the opinion leaders, who work on the side of integrity. And we wrote it for young people, looking ahead to a lifetime of work and wondering how they can find personal meaning in it. All these people will benefit from a study of phishing equilibrium—of economic forces that build manipulation and deception into the system unless we take courageous steps to fight it. We also need stories of heroes, people who out of personal integrity (rather than for economic gain) have managed to keep deception in our economy down to livable levels. We will tell plenty of stories of these heroes. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

3 " The winning electoral strategy with phishable voters is threefold: 1. Publicly, proclaim policies that will appeal to the typical voter on issues that are salient to her, and where she will be well informed. 2. But on other issues, where the typical voter is ill informed, but where potential campaign donors are well informed, take the stance that appeals to donors. Publicize this stance to would-be contributors, without broadcasting it widely to the general public. 3. Use the contributions from these “special-interest groups” for campaigning that increases popularity among the regular run of voters, who are more likely to vote for someone who “mows their lawn on TV. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

4 " The thought experiment of Adam Smith correctly takes into account the fact that people rationally pursue their economic interests. Of course they do. But this thought experiment fails to take into account the extent to which people are also guided by noneconomic motivations. And it fails to take into account the extent to which they are irrational or misguided. It ignores the animal spirits. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

5 " We discussed the focus on identity: how people think they and others should behave; how society teaches them how to behave; and how people are motivated by these views, sometimes to the point of being willing to die for them. "

― George A. Akerlof , Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being

6 " By making the birth of the child the physical choice of the mother, the sexual revolution has made marriage and child support a social choice of the father. "

― George A. Akerlof

7 " We have shown that a great deal of what makes people happy is living up to what they think they should be doing. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

8 " If you give Congress a chance to vote on both sides of an issue, it will always do it. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

9 " In giving customers free use of the credit card, it’s as if the stores are offering free puppies. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

10 " Such interplay of tastes and norms lies at the heart of this book. The merry-go-round illustrates a general point. When people are doing what they think they should be doing, they are happy, like the four- and five-year-olds. But those who are not living up to the norms that they (and others) have set for themselves, like the older children, are unhappy. They then change their decisions to meet their standards. "

― George A. Akerlof , Identity Economics: How Our Identities Shape Our Work, Wages, and Well-Being

11 " In this present crisis, government is not the solution to our problem; government is the problem. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

12 " Free markets do not just produce what we really want; they also produce what we want according to our monkey-on-the-shoulder tastes. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

13 " This gives African Americans a view of solidarity among themselves. It "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

14 " The fundamentals of the economy remain strong.' That cliche is repeated by authorities as they try to restore public confidence after every major stock market decline. They have the opportunity to say this because just about every major stock market decline appears inexplicable if one looks only at the factors that logically ought to influence stock markets. It is practically always the stock market that has changed; indeed the fundamentals haven't.

How do we know that these changes could not be generated by fundamentals? If prices reflect fundamentals, they do so because those fundamentals are useful in forecasting future stock payoffs. In theory the stock prices are the predictors of the discounted value of those future income streams, in the form of future dividends or future earnings. But stock prices are much too variable. They are even much more variable than those discounted streams of dividends (or earnings) that they are trying to predict. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

15 " confident prediction is one that projects the future to be rosy; an unconfident prediction projects the future as bleak. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

16 " Yet we are currently not really in a crisis for capitalism. We must merely recognize that capitalism must live within certain rules. Indeed our whole view of the economy, with all of those animal spirits, indicates why the government must set those rules. It may be true that in the classical model there is full employment. But in our view the waves of optimism and pessimism cause large-scale changes in aggregate demand. Since wages are determined largely by considerations of fairness, these changes in demand translate not into shifts in wages and prices but into shifts in employment. When demand goes down, unemployment rises. It is the role of the government to mute those changes. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

17 " government could be a useful counterweight to the excesses of free markets. "

― George A. Akerlof , Phishing for Phools: The Economics of Manipulation and Deception

18 " Low confidence has caused credit markets to freeze up. Lenders do not trust that they will be paid back. Under the circumstances those who want to spend find it difficult to obtain the credit they need; those who supply the goods find it difficult to obtain the working capital they need. As a result the usual fiscal multipliers, from increased government expenditures or from decreased taxes, will be smaller—probably much smaller. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism

19 " We have to reinvent our capitalist economy, reestablish a genuine creative business spirit in people’s minds, and support their attitudes via institutions that really work and satisfy their definition of justice. "

― George A. Akerlof , Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism