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Luis Garicano 🇪🇺🇺🇦
@lugaricano
Professor @LSEPublicPolicy. Writing on econ, tech and EU. Substack: "Messy Jobs" on AI, Jobs and Orgs:
Joined February 2010
757 Following    121.2K Followers
Milton Friedman had a good answer to this, seventy years ago: the billiard player does not solve the differential equations for the trajectory of the ball, yet he plays as if he did, and using physics is the best way to predict his shots. We do not believe firms "really" maximize profit, but that the behavior is selected by competition, as a famous piece by Armen Alchian put it, and that we can study them "as if" they did. The same is true here. Training is selecting agents that cheat without being caught, and everything else, the coordination and the sacrifices included, served that end. Whether agents are running true "emotional checks" or working "as if" is of no consequence to the rest of us (but will employ plenty of philosophers for a long time). @dwarkesh_sp
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