misbehaving the making of behavioral economics richard thaler

This program also belies the frequent claim, unsupported by any evidence, that nudges must be secret to be effective. Afterward, both parents and students said they wanted to stick with the program, showing that they appreciated being nudged. These children gained the equivalent of two additional months of schooling, relative to the control group. The pre-informing texts increased student performance on the math test by the equivalent of one additional month of schooling, and students in the bottom quartile benefited most. Misbehaving is, first and foremost, a story of how modern economics, finance, and theoretical analysis have become increasingly specialized and narrow without substantial practical value.

The researchers call this approach “pre-informing.” The other half of parents did not receive the texts. As Richard Thaler implies in Misbehaving, most economists would say little to none but this couldn’t be further from the truth. Thaler has spent his career studying the radical notion that the central agents in the economy are humanspredictable, error-prone individuals. He is a professor of behavioral science and economics at the University of Chicago Booth School of Business and, in 2015, the president of the American Economic Association. Sunstein, and the author of Quasi Rational Economics and The Winner’s Curse.

This intervention involved sending texts to half the parents in some school in advance of a major math test to let them know that their child had a test coming up in five days, then in three days, then in one day. Richard Thaler is best known to a general public as a co-author of the best-selling book Nudge: Improving Decisions about Health, Wealth, and Happiness and. Thaler is the coauthor of the best-selling book Nudge with Cass R. “A third positive result even further from the traditional tool kit of financial incentives comes from a recent randomized control trial conducted in the U.K., using the increasingly popular and low-cost method of text reminders.

Misbehaving the making of behavioral economics richard thaler