This is the second part of a two-part paper. It can be read independently of the first part provided that the reader is prepared to go along with the unorthodox views on game theory which were advanced in Part I and are summarized below. The body of the paper is an attempt to study some of the positive implications of such a viewpoint. This requires an exploration of what is involved in modeling “rational players” as computing machines.

In an interesting letter to Anna George, the daughter of Henry George, Bernard Shaw wrote: “Your father found me a literary dilettante and militant rationalist in religion, and a barren rascal at that. By turning my mind to economics he made a man of me” (George, 1979, p. xiii). I am not able to determine what making a man of Bernard Shaw would exactly consist of, but it is clear that the kind of moral and social problems with which Shaw was deeply concerned could not be sensibly pursued without examining their economic aspects. For example, the claims of property rights, which some would defend and some (including Shaw) would dispute, are not just matters of basic moral belief that could not possibly be influenced one way or the other by any empirical arguments. They call for sensitive moral analysis responsive to empirical realities, including economic ones.

The Greek poets and philosophers, united in a belief that men and women perceive the world around them very poorly, for this reason describe much of human behavior as fumbling for happiness in the dark. By contrast, perception failure is anathema to the modern tradition, as even the most innocent sort plays havoc with modern preference axioms.