behavioural economics

Paul Krugman, the 2008 winner, tweeted ‘Yes! Behavorial econ is the best thing to happen to the field in generations, and [Richard] Thaler showed the way.'

Good science is essentially a subversive activity. Most scientists work within the existing paradigm – the framework of the basic assumptions, ways of thinking, and methodology commonly accepted by the discipline. The better ones keep an eye out for anomalies which require some adaptation of the paradigm.

How does a post-truth world work? Some psychological findings may be useful. (The Oxford Dictionary definition of ‘post-truth’ is ‘Relating to or denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief’ The Dictionary labelled it the word of the year 2016.)

This columnist is greatly perplexed by how in today’s post-truth world people hold views or which are not true, which may be contradictory but which are held with a tenacity which belies their falsehood. This is sometimes called ‘truthiness’; the views are believed to be true because they confirm beliefs. But that is a label, what is going on?

A book about two psychologists who have altered the way we think about the way we think.

For many people, Michael Lewis is best known for his 2010 book The Big Short and the follow-up film, which describes the carryings-on of the financial sector in the American housing market which underlay the Global Financial Crisis.

Should membership of Kiwisaver be compulsory? Research on how humans behaviour, some of it thirty years old, points in that direction.

The current debate over the future of Kiwisaver is largely bereft of developments in economics over the last thirty or so years. Rather the frame has been an approach to human behaviour which we know does not reflect reality.