Google Fiber’s latest FCC filing is Comcast’s nightmare come to life

Would you care to highlight what major fallacies I'm proposing here?

You didn't explicitly propose any specific fallacy but you said you disagreed from an economic standpoint which I take to mean that you think economic theories in general are valid and trump seemingly contrary facts. My answer is that these facts are not just seemingly but actual contrary and many of the basic tenets of economic theory are flat out wrong.

Unfortunately the reddit format isn't conducive to extensive discussions but I'll give it a shot anyway:

The assumption of a free market has some associated assumptions: 1) infinite number of suppliers, 2) infinite number of buyers and 3) unrestricted access to information. Further it assumes 4) that all actors are rational in a very specific sense: rational actors evaluate all possible options, all possible outcomes and eventually choose the outcome they deem most beneficial to themselves.

I won't go into detail about the first three assumptions because they're obviously unrealistic in most cases.

But the last one is pretty close to assume that all actors are autistic, and I don't just say this as a polemic comment, it is actually a totally unrealistic assumption. This in itself is quite damning because the free market does not work as theorized if actors are not basically rational in this specific sense.

But it gets worse: even if actors were indeed semi autistic and were following rigid logic patterns, the assumptions of them evaluating all options and choosing the best is still a fallacy because it assumes that we can predict the future with a very high degree of certainty, an assumption that has repeatedly been shown to be less than accurate. What we do instead - here specifically looking at how businesses actually make decisions - is that we look very closely at what others are doing and try to perform at little better or at least not significantly worse. This leads to most businesses mimicking others' successes while trying to avoid their failures. This leads to a rather different assumption of "good enough compared to other relevant actors".

You see what I did there?

This is a social claim, or a network claim, if you will. Actors base their decisions on how they perceive that other relevant actors behave, not on the rationally best outcome.

One attempt to remedy this has been to assume "bounded rationality" which basically means that you act rational within the boundaries of your knowledge horizon. The very big problem with this - at least how it is presented withing economics is that the argument ends up being circular: if you act in a certain way it MUST be because you somehow find this particular behavior beneficial, and from then on the economic research just has to employ equations that can elicit what those specific benefits are. This is called a teleogical fallacy. The obvious problem is that this kind of studies are no longer proving economic theory but either present specific (non-theoretic) facts or sometimes in reality are studies in psychology - which does not follow the logic of free market theories.

Another issue I see repeatedly in econ papers is what I see as a form of reification: believing that if you can prove a hypothesized relationship this is also proof or your proposed reasoning about that relationship. This plays out according to this pattern: propose a set of hypotheses about human behavior changes in face of changing conditions. Show mathematically (the longer and more incomprehensible the equations the stronger the argument) that indeed the behavior changes according to your hypotheses. When this has been shown, the researcher goes on to explain the proven behavior within the realms of psychology or sociology - which was not at all, or only anecdotically part of the hypothesis building and in any event not what was proven by the research.

The most insidious about this particular aspect of economics is that this kind of research and their conclusions are used as major underpinnings for all kinds of policies that affect real people in all kinds of ways.

These are some of my objections to traditional economy - short and missing all kinds of relevant context but still something.

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