Carnegie School

James March and Herbert Simon in 1958’s Organizations identified perhaps the central puzzle of hierarchical organizations: how can structures composed of (boundedly rational) individuals, each subject to a raft of cognitive biases and limited processing capacity, manage to accomplish the magnificent? The answer was that hierarchy, long seen as simply a manifestation of a chain of command, served an information-processing function directly analogous to a computer program....

— Carnegie School

The essay discusses the rise of (modern) behavioral economics during the last few decades. In contrast to ’s assertion, in his Feb. 11, 2001, NY Times essay, that behavioral economics began in 1994, I would try to argue that it began during the 1950s and early 1960s, although some aspects of it had even emerged in the works of Marshall, Wesley Mitchell, J.M. Clark and others, before WWII.

— Carnegie School