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Entries Tagged as 'Behavioral Econ'

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My Favorite Coase Theorem Illustration Is Taking Over The World…

August 29th, 2014 · 24 Comments
Behavioral Econ · Econ 101

The fall academic semester is quickly approaching, so it’s a good time to remind readers that one of the goals of this site is to give economics instructors interesting examples and discussion topics for their classes. Those of you teaching Principles of Economics this term (as well as those of you teaching Environmental Economics and [...]

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Tags: Behavioral Econ · Econ 101

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When Transaction Utility Goes Awry, Starbucks Edition…

May 29th, 2014 · 3 Comments
Behavioral Econ · Buyer Beware

Traditional economic models assume that the utility, or happiness, one gets from consuming an item depends only on how fundamentally useful the item is to the consumer. Under this model, an item’s utility must be independent from the price that the consumer paid for the item, since it’s hard to envision a scenario where the [...]

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Tags: Behavioral Econ · Buyer Beware

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This Year’s Economist Valentinegram…

February 14th, 2014 · 5 Comments
Behavioral Econ

Via a Twitter friend: It’s funny because it’s true, and I’ve been trying to explain this to people for years. (In related news, economists don’t have a reputation for being particularly romantic.) In case you’re not familiar, sunk costs are costs that you’ve already paid and can’t recover- i.e. you can’t get your money back. [...]

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Tags: Behavioral Econ

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An Economist On Christmas…

December 25th, 2013 · 2 Comments
Behavioral Econ · Just For Fun

First off, happy holidays!

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Tags: Behavioral Econ · Just For Fun

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An Implicit Tax Hike On Irrationality, Lottery Edition…

December 13th, 2013 · 11 Comments
Behavioral Econ · Decision Making · Fun With Math

Lots of people like saying that playing the lottery is a bad bet- and it is, mathematically speaking. If you ever need to convince someone of this, allow me to suggest the following argument: Let’s say you had the option to put a dollar into a collection along with 9 other people. One of the [...]

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Tags: Behavioral Econ · Decision Making · Fun With Math

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On Economists Giving Thanks, And The Avoidance Of Arms Races…

November 28th, 2013 · 2 Comments
Behavioral Econ · Buyer Beware · Game Theory · Policy

First off, HAPPY THANKSGIVING! I am very thankful that you all read my online ramblings Once you get drowsy from eating too much Thanksgiving dinner (and no, it’s not the turkey, that’s mostly an urban legend, unless of course you ate the entire turkey), you should feast on what Dan Ariely has to say about [...]

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Tags: Behavioral Econ · Buyer Beware · Game Theory · Policy