The issue is that assumptions such as perfectly rational actors can diverge so far from reality that it renders the resulting idealized conclusions meaningless from the perspective of actual human economies. The abstract study of incentives is of course interesting in its own right, but may have little to do with economics in practice -- i.e. the important practice of how actually should we run an economy.<p>What theoretical economists do is not &#x27;nonsense&#x27; but can become nonsense when it naively forms the rationale for real-world policy.