Behavioral Economics (BE), a mash-up of psychology and economics, originally interested me because it promised a way to understand and predict mistakes that people make. This helped me do a better job as a banker to governments and nonprofits, because I could help them (and me) avoid those mistakes. It took a while for me to … Continue reading Make Any Decision
What do classical music in the train station, binge-inducing pre-loaded TV show episodes in Netflix, and those “I voted stickers” you get after voting have in common? Read our latest article, “Nudges: For Your Own Good?” about how government and businesses “nudge” your behavior for your own good…or maybe not (5 minute read). Continue reading Nudges: For Your Own Good?
I just attended the best conference ever. And I’ve been to a lot of them. The ideas42 Behavioral Summit 2016 was billed as offering “…an inside look at the latest developments from the field of behavioral science and how these insights drive innovation in the private sector.” Indeed it went beyond that, touching on politics, … Continue reading Good Behavior? What I Learned at the Behavioral Summit (and How it Freaked Me Out a Little)
Decision Fish Interviews Kim Stephenson, an occupational psychologist. Perhaps the greatest benefit of the World Wide Web, is contained in the first two words. Decision Fish’s blog has readership worldwide, self-selected to be some of the most thoughtful and smartest people anywhere. Kim Stephenson, an occupational psychologist from the UK is one of those people. Here’s a … Continue reading Interview With a Skeptic
When we make decisions, we often take the way they are presented to us at face value. Maybe a sales person offers you a menu of investment options or maybe a single recommendation; either way, you can bet a lot of thought went into the architecture of the choice presented to you. Amos Tversky and Daniel … Continue reading Framing 1, Facts 0?
Yesterday, I was 15 minutes late for an appointment, notwithstanding my New Year’s vow (repeated—and failed—annually) to be more prompt. Last week, I published on my blog and social media my intention to create a web site that will apply best practices in decision science to help people make better financial decisions. Just the thought … Continue reading Hide Your Clothes: How to Coerce Your Future Self
The quantity, complexity and importance of the financial decisions we have to make keeps increasing. For example, as traditional defined-benefit pension plans going extinct, people increasingly have to manage their own retirement plans. There are more investment choices than ever: structured CDs, marketplace lending, crowdfunded start-ups not to mention thousands of ETFs and mutual funds. … Continue reading The Myth of Financial Literacy Education
Many of the most important decisions we make involve trade-offs between the present and future. How much of my income should I save today for my retirement? What costs should governments incur today to reduce the risk of catastrophic climate change in the (hopefully) distant future? How should businesses allocate investments that pay off in … Continue reading Future & Present: Where Brains, Math and Ethics Collide
A bias is an unconscious, natural and immediate prejudice or tendency to a particular action. Bias-driven decisions may or may not be consistent with that which may result from a more deliberative or thoughtful process. Biases can be harmful: think of prejudices in employment, housing and education. They can be helpful as when we slam on … Continue reading Bias Among Us: How to Influence Others & Ourselves
HBR’s recent article, Leaders as Decision Architects, is a detailed investigation of how business managers can improve employee choices by adjusting the framework, context and process in which those decisions are made. The authors draw from two of my favorite books in behavioral economics, “Thinking Fast and Slow” and “Nudge”. There’s no doubt that in the right … Continue reading Choice Architecture: Don’t be Evil