Behavioral Economics for All: From Nudging to Leadership, Julia Puaschunder, 2023
Behavioral economics is an innovative applied science. In the 1950s, economic rational choice models came under scrutiny. A theoretical critique emerged that not all humans strive for efficiency and rationality all the time. Behavioral economics first drew attention to deviations from rationality. Discussions of the non-applicability of rational choice models called for depicting actual human behavior. During the 1970s, Amartya Sen formalized the rational choice critique and integrated social aspects into core axioms of rationality, efficiency and time consistency. By 1979, the two psychologists Daniel Kahneman and Amos Tversky presented a line of laboratory experiments proving rational choice theory inaccurate to explain real-world decision patterns. The following behavioral economics revolution rewrote economics for accuracy and predictability. Sociologists, political scientists and psychologists created a line of research to describe how individuals actually decide and behave. From 2010, behavioral insights were used to find ways how to ‘nudge’ people to make better choices. Around the world, governmental officials and governance experts adopted behavioral nudges and winks to create better choice architectures in different domains. This book covers the emergence of behavioral economics with attention to North American roots and European interpretations in order to then prospect future trends in behavioral economics. First, given the enormous popularity behavioral economics has enjoyed in the most recent decades, a general knowledge has formed about behavioral nudges. Libertarian paternalism is – by now – limited when it comes to implicitly tricking people into making choices. A common body of knowledge on behavioral aspects of choice patterns may lead to reactance if people notice manipulation. The general population should therefore be trained to make self-empowered choices that meet their individual principles, needs and wants based on their behavioral expertise. Behavioral economists should move from manipulating nudges behind the scenes to educating in client-service approach trainings of the layperson. Decision makers should be encouraged to choose wisely for themselves and lead their own decisions based on behavioral insights. Second, the field of behavioral sciences experienced a deep replication crisis in the last decade given major data cheating scandals and contemporary fraud allegations. General oversight mechanism between co-authors, backtesting of effects for validity and their general applicability is therefore warranted. The general population should be encouraged to be critical of behavioral insights and give feedback on the potential non-applicability of p-hacked behavioral results. Third, online searchplace distortion of behavioral economics has become a sad reality for young behavioral economists in the strategic search engine results manipulation through Search Engine Disoptimization. This implicit internet harassment calls for a democratization of information and whole-rounded inclusion of thoughts online. Behavioral economists should raise awareness for this negative competitive behavior and work together with global governance institutions, regulatory bodies but also industry professionals to curb negative internet search engine manipulation and empower the upcoming generation of behavioral economists to speak up when this is happening. Professional bodies should help those whose career has been hit by competitive internet manipulation. All these trends are speculated to lead to a revamped behavioral economics revolution that demands for behavioral economics for all. The future of behavioral economics is believed to lie in a democratization of behavioral economics information that guides a self-empowered decision-making cadre. Search for credible behavioral insights can leverage the field to become a standing guidepost for wise quality choices. The digital millennium calling for fair internet use will hopefully prosper an inclusive field with diversified information on behavioral insights to be accessible, useful and meaningful for all.