Richard Thaler on Behavioral Economics: Past, Present and Future

Thaler, co-author of the global bestseller “Nudge,” will give a talk on “behavioral economics,” which attempts to incorporate insights from other social sciences, especially psychology, in order to enrich the standard economic model. This interest the underlying psychology of human behavior returns economics to its earliest roots. Scholars such as Adam Smith talked about such key concepts as loss aversion, overconfidence, and self-control. Nevertheless, the modern version of behavioral economics introduced in the 1980s met with resistance by some economists, who preferred to retain the standard neo-classical model. They introduced several arguments for why psychology could safely be ignored. Thaler