Richard Thaler v2

Richard Thaler

Misbehaving: The Making of Behavioural Economics

May/
Tue 31 May 2016

Richard Thaler

Misbehaving: The Making of Behavioural Economics

Richard Thaler v2
Tue 31 May 2016,

Whether buying an alarm clock, selling football tickets or applying for a mortgage, we all succumb to biases and make decisions that deviate from the standards of rationality assumed by economists. In other words, we misbehave.

Why are we more likely to forgo the opportunity to sell a £100 bottle of wine rather than actually taking money out our wallet to pay for it, when ultimately the ‘opportunity cost’ of doing so is the same? Why would the ‘endowment effect’ mean that we value a free ticket worth hundreds of pounds more than the money we would get from selling it?

Coupling recent discoveries in human psychology with a practical understanding of incentives and market behaviour, Richard Thaler exposes the irrational tendencies in our thinking and shows us how to avoid making costly mistakes in life.

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