There Is More to Behavioral Economics Than Biases and Fallacies

Koen Smets – Behavioral Scientist

There are plenty of places you can find lists of biases, capturing human behaviour at the edge of human rationality. All too often they get used to reinforce a tendency to play cognitive bias I-spy, prompting us to spot the many ways in which actual messy humans fall short of tidy economic assumptions. This post gives a beautifully clear account of why interpreting them in that way risks missing the point, imposing a dangerously inaccurate determinism on human behaviour.

Armed with a sparkling new vocabulary of cognitive and behavioral effects, it’s easy to see examples of biases all around us, and we fool ourselves into believing that we have become experts. We risk falling prey to confirmation bias. The outcomes of experiments appear obvious to us because we overlook the intricate nature of the full picture (or fail to notice unsuccessful replications). By simplifying human behavior into a collection of easily identified, neatly separate irrationalities, we strengthen our misguided self-perception of expertise.

And as Carla Groom noted in drawing attention to the article, seductive science isn’t a good basis for effective policy making:

 

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