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Wanted: a unifying theory of behavioural economics

Noah Smith

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Behavioural economics has always met with a bit more resistance than it deserved. This is true even though a number of behavioural researchers have won the Nobel – Daniel Kahneman, Robert Shiller and Richard Thaler just last year. Despite this and other forms of official recognition at the highest levels, there continue to be some economists who have an almost instinctive aversion to behavioural ideas themselves.

Meanwhile, though research in behavioural economics continues, behavioural ideas haven't spread -- in most fields of econ, the vast majority of models continue to be based on an idealised, perfectly rational homo economicus. Meanwhile, the occasional economist still feels comfortable declaring that the behavioural paradigm is doomed.

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    Original URL: https://www.afr.com/policy/economy/wanted-a-unifying-theory-of-behavioural-economics-20180108-h0ex23