Behavioral Economics Short Course

Rest Day Read (SR-36)
#10 Economist George Loewenstein
on Behavioral Economics

Interview from Discover Magazine’s Top 100 Stories of 2009
“Behavioral economics provides a framework for explaining why people behave in a self-destructive fashion. It’s more realistic about human behavior.”
“Or take what is called the default effect: People tend to be lazy decision makers, taking the path of least resistance. And defaults are often unhealthy: At McDonald’s, for example, if you order a combo meal, the default includes a soda. We did field research at a fast-food restaurant showing that if you make the healthy options just slightly more convenient-for example, with an “express menu” that has healthy options but requires turning the page to see the full menu- you can get people to eat more healthily. You can use laziness to help people.”

Behavioral economics. Interesting stuff. The interview with Dr. Loewenstein is brief and to the point. The interview begins by addressing some of the reasons for the panic behavior with the economic meltdown of the past several years then spider webs out to a myriad of behaviors. It touches a mother-lode of information and explanation on the whys and hows of what happens when things unravel. As a coach, there’s many points in this interview that can be applied to team dynamics and individual performance. There are also points to help me understand and continue to work toward being a better human being. Good stuff!

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