From TED "Using examples from vacations to colonoscopies, Nobel laureate and founder of behavioral economics Daniel Kahneman reveals how our "experiencing selves" and our "remembering selves" perceive happiness differently. This new insight has profound implications for economics...

by Nick Paumgarten "Like many who have come before, [John Mackey, CEO of Whole Foods] says that it was only when he started a business--when he had to meet payroll and deal with government red tape--that his political and economic views, fed on readings of Friedman, Rand, and the Austrians, veered...

The New Interface of Governance Frontier / by Nancy Scola "If we can just tweak the way we make choices, we can make smarter ones. A look at Obama’s plans to put the science of human nature to work. For those of us familiar with the strange land that is Washington, DC, it’s tempting to snicker a...

This article about economic decision making was written by one of our grant recipients, Sendhil Mullainathan. "All too often, the choices of the poor are viewed as a result of either some intrinsic failing (“they’re just very myopic people”) or some deep psychological feature of poverty (“they’re...

From the publisher: "The global financial crisis has made it painfully clear that powerful psychological forces are imperiling the wealth of nations today. From blind faith in ever-rising housing prices to plummeting confidence in capital markets, "animal spirits" are driving financial...

"The first full crisis of globalization means the start of a kinder, more selfless economic system. There are some who say this current global financial recession, this recession/depression that is being felt in London and New York, in Shanghai and Sao Paolo, will not have an impact on the nature...

The focus on complexity as a problem of the financial meltdown of 2008–2009 suggests that crisis is in part epistemological: we now know enough about financial and economic systems to be threatened by their complexity, but not enough to relieve our fears and anxieties about them. What marks the current...

by James Forbes and S. Murat Kara A comprehensive investment literacy questionnaire surveyed potential sources (viz., knowledge, confidence) of investing self-efficacy in a large sample of working adults. As expected, the effect of investment knowledge on belief in one’s future capability of orchestrating...

by Andrew Healy This paper presents experimental evidence about how effectively individuals learn from information coming from heterogeneous sources. In the experiment, Thai subjects observed information that came from Americans and from other Thais that they could use to help them answer a series of...

We argue for attention to the evolutionary origins of economic behavior. Going beyond this, we argue that the economy of hunting and gathering was the context in which evolution shaped human characteristics that underlie modern economic behavior. We first reconsider the basic biological question of why...

In the standard economic model, people are unbounded in their ability to think through problems. Regardless of complexity, they can costlessly figure out the optimal choice. They are also unbounded in their self-control. In contrast to the traditional model, a growing body of research interprets economic...

Standard theorizing about poverty falls into two camps. Social scientists regard the behaviors of the economically disadvantaged either as calculated adaptations to prevailing circumstances, or as emanating from a unique “culture of poverty,” rife with deviant values. The first camp presumes that people...

This paper poses a Deweyan challenge to both the neoclassical framework of rational choice and models of bounded rationality and deliberation, especially the procedural theory of rationality advanced by Herbert Simon. We demonstrate how modern theories on procedural or instrumental rationality trace...

In order to investigate the impact of limited memory on human behavior, I develop a model of memory grounded in psychological and biological research. I assume that people take their memories as accurate and use them to make inferences. The resulting model predicts both over- and underreaction but provides...