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TEMPORARY DISTORTIONS AND INDIVIDUAL IGNORANCE

Individuals live their lives under the forces of time and ignorance. Since the economy is dealing with the study of a significant part of people’s lives, it was normal that aspects of it to be considered sooner or later. Our intention, when we started this paper, was to develop a certain apparatus of economic analysis, which unites several branches of the sciences that study the products of cooperation between people and to show how these products evolve depending on the expectations and the time horizon of individuals. The term “ignorance” has nothing pejorative in this context because it is largely the result of a rational choice of individuals. Limiting resources, and in particular time availability, causes people not to use all the information they might gather if they have at their disposal unlimited amounts of time and money. In addition, certain information, such as the tastes and wishes of others, is inaccessible to the individual from an economic point of view. The individual must rely on certain mechanisms and social institutions to co-operate with his fellows, including trading. But one of the temptations that one finds hard to resist is to show how people’s lives can be ameliorated if some bad influences would be eliminated; how can those forces that apparently destroy the plans of individuals can be countered; Finally, how, through some well-thought-out measures, people’s lives can get a happy turn when they no longer expect anything better. From this perspective, we hope that the present paper transmits in an indirect way a clear message: we have resisted this temptation. No! People’s lives cannot be made better by pencil traits, by genius ideas about the overall social organization or by combating ignorance. Instead, it can be made more difficult and miserable. It is right that social sciences do not have, in the eyes of many, the status of physics or mathematics for example. However, economic constraints are real and cannot be avoided simply by ignoring them. Ignorance becomes truly dangerous only when some people can decide the fate of others over their will.