What is behavioral economics?
1 Answer
Behavioural economics, along with the related sub-field behavioural finance, studies the effects of psychological, social, cognitive, and emotional factors on the economic decisions of individuals and institutions.
Explanation:
Behavioural economics, along with the related sub-field behavioural finance, studies the effects of psychological, social, cognitive, and emotional factors on the economic decisions of individuals and institutions and the consequences for market prices, returns, and resource allocation, although not always that narrowly, but also more generally, of the impact of different kinds of behaviour, in different environments of varying experimental values.
Behavioural economics is primarily concerned with the bounds of rationality of economic agents. Behavioural models typically integrate insights from psychology, neuroscience, and microeconomic theory; in so doing, these behavioural models cover a range of concepts, methods, and fields.
