After posting on Gillian Tett's Fool's Gold, I chanced upon this article on the Wharton website pinpointing the same kinds of cognitive lapse (made by most economists as well as by financiers, the profs quoted here argue). The article also cites the Dahlem report which also focuses on the intellectual blinkers of conventional economic analysis.

The onset of the crisis prompted many commentators to blame economists, of course. I think it's simplistic to say a dominant economic model 'caused' the crisis in any sense. If one has to pick out any single cause, it would be the classic driver of crises, the self-feeding greed of those actively engaged in the financial markets. Not that there could be a single cause - history as ever is messily over-determined.

Nevertheless, there's an interesting accumulation of evidence and argumentation about the role played by the social structures of the economics profession in shaping the intellectual landscape which shaped this financial crisis. I still believe the Efficient Markets Hypothesis has its place -  in particular in teaching us that active investors can't beat the market except by chance (as Nassim Taleb has argued in his inimitable way in Black Swan and Eugene Fama has recently shown again in an empirical paper). Although we should understand its limitations, conventional economists must take seriously the lessons of recent events for our worldview.