Day 90 of 365
March 31
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Economics Behavioral Economics
Behavioral economics challenges the assumption that people are rational actors, documenting systematic deviations from rationality. Loss aversion makes losses feel twice as painful as equivalent gains feel good. Anchoring causes the first number you see to influence subsequent judgments. Default options have disproportionate influence on choices. Understanding these biases helps design better policies and explains seemingly irrational economic behavior.
💡 Did you know?
Richard Thaler won the 2017 Nobel Prize in Economics partly for showing people are more likely to save for retirement when automatically enrolled with opt-out!
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