behavioral economics

Why You Are Not Rational【Behavioral Economics】

Humans are rational animals, but not rational

Humans are considered rational animals, but in reality they behave very irrationally.

American economist Richard Thaler published “Nudge Theory”, preaching the irrational principles of human behavior.

He won the Nobel Prize because Nudge theory had a great influence on behavioral economics.

But take it easy.

This theory will help you in your daily life.

Which do you prefer?

  • ① To get $ 100 now
  • ② to get $ 120 a year later

Needless to say, ② is more rational than ①.

However, in reality, many people choose ①.

Even with the same amount of income (expenditure), people feel that the closer it is to the present, the greater it is.

On the contrary, the farer from the present, the smaller you feel it is.

Of course, this is an illusion, not the truth.

For example, have you ever regretted shopping too much with your credit card?

・References
https://tama.wtf/jp/society/psychology/behavioral-economics
Wikipedia: Behavioral economics

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