Economics · Applied
Behavioral Economics
What happens when economics admits people aren't perfectly rational: prospect theory and loss aversion, anchoring, framing, mental accounting, present bias, nudges like auto-enrollment, applications to investing, and the replication caveats.
Step 1 of 6 · Overview30 min read ·
Key idea
Prereqs: Supply & demand; Cognitive biases (Psychology). Next: Second-order thinking. Sources: Kahneman & Tversky, 'Prospect Theory' (1979); Kahneman, *Thinking, Fast and Slow* (2011); Thaler & Sunstein, *Nudge* (2008); Thaler, *Misbehaving* (2015).Next: 1. Prospect theory