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Behavior Economics

Workshop: 003 Behavioral Economics Belief-Based Utility

Who is this Workshop for? 

High school students are interested in researching behavioral economics, judgment and decision making, human behavior, or social psychology.  

Workshop Description

Recently, behavioral economists have begun taking seriously the premise that people care fundamentally not just about objective outcomes but about their beliefs.  Conventional economics assumes that people desire information to the extent and only to the area that enables them to make better decisions and update their ideas optimally in response to such information.  The reality is, of course, very different.  People cherish their beliefs, defend themselves from perceived challenges, and are often hostile to people who have other ideas.  Such ‘belief-based utility’ can lead to camaraderie or conflict, information seeking or avoidance, uncertainty tolerance or aversion, and motivated reasoning or forgetting. We see belief-based utility at play when liberals and conservatives stop listening to each other, read-only slanted news from, e.g., the Huffington Post or the Drudge Report, and denigrate media sources they perceive as partial to the other side, e.g., the New York Times or Fox News.  In the worst circumstances, the belief-based utility can lead to violent conflict, e.g., between Catholics and Protestants or between Sunni and Shia Muslims. The belief-based utility is at play when sick patients refuse to see a doctor, when terminally ill patients eschew palliative care in the unrealistic hope of a cure, and when CEOs surround themselves with yes-men.

Sample Research Topics

  • Do reminders about a person’s affiliation with a political party make that person less likely to read an op-ed written by a member of the opposing political party?

  • Are people who own air conditioners less willing to look at their electricity bills on hot days?

  • Do surprising clues make people more curious to find the answers to trivia questions?

  • Are students more eager to find out their test scores if they have studied for the test?

  • Does exposure to an opposing view make a person more likely to convince others that their own opinion is correct?

  • Will a person spend more time coming up with a funny story if the listener lets the storyteller know whether they found the story funny than if the listener does not provide any feedback?

  • Are dieters more willing to choose a healthy snack instead of an unhealthy snack if they are given a picture of themselves eating the snack and asked to upload it to a social networking site or app?