Behavioral Economics

Behavioral economics asks questions about the economic decisions that people make. Do individuals always act in their own best interest when it comes to maximizing utility, efficiency, and value?

Explore Behavioral Economics

Rational Choice Theory
Rational Choice Theory: What It Is in Economics, With Examples
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What Is the Illusory Truth Effect?
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Normalcy Bias: How It Could Affect Your Investing
Barriers to Entry: Understanding What Limits Competition
Man dangling out of loft hatch with one foot touching step ladder
Moral Hazard vs. Morale Hazard: What's the Difference?
Detail of a Golden Bull Breaking Through the Finance Section of a Newspaper
Animal Spirits: Meaning, Definition in Finance, and Examples
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What Does Tit for Tat Mean, and How Does It Work?
What Is Revealed Preference in Economics, and What Does It Show?
Cropped Hand Holding Gavel Against People During Auction
Winner's Curse: Definition, How It Works, Causes, and Example
Midsection of Businessman Using Calculator and Laptop at Desk
Rational Behavior: Definition and Example in Economics
Financial pundit Jim Cramer
Understanding Information Cascades in Financial Markets
Frustrated Young Man with Laptop, Sitting on the Floor
Discouraged Worker: Definition, Causes, Vs. Unemployed
Socialism: History, Theory, & Analysis
A hand holds a poster sign that reads "SAVE THE MIDDLE CLASS" in black marker on yellow paper in the middle of a crowd.
What Is Middle Class Income? The Latest Numbers Available
Businessman in a suit standing outside a building look outward with a tablet in his hand
What Is a Laissez-Faire Economy, and How Does It Work?
Why Do Supply Shocks Occur and Who Do They Affect?
How Does Deflation Impact Consumers?
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What Are the Odds of Scoring a Winning Trade?
Time-Preference Theory of Interest: Overview and History
Internet Bubble
Millenial Group of Friends Going out Having Fun Together
How the Financial Crisis Affected Millennials
Diffusion of Innovations Theory: How new technological and other advancements spread throughout societies and cultures.
Diffusion of Innovations Theory: Definition and Examples
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How Do Supply and Demand Affect the Oil Industry?
Adaptive Market Hypothesis (AMH): Overview, Examples, Criticisms
Belt and Suspenders
Prospect Theory: The idea that investors place more weight on perceived gains than perceived losses.
Prospect Theory: What It Is and How It Works, With Examples
Evolutionary Economics: Overview, History, Examples
Financial Accelerator
Common-Pool Resource: Definition, How It Works, and Examples
A hand holding an Apple Watch with the startup graphic on the screen.
Market Overhang
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Shadowing: Definition and How It Works, Vs. Interning
Close up Hands of Businessman Working With Business Document and Laptop on the Table
Intraday Return
What Are the 4 Types of Economic Utility?
Are There Any Exceptions to the Law of Demand in Economics?
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What Are Examples of Moral Hazard in the Business World?
War's Influence on Wall Street
How Interest Rates Help Promote Saving and Investing
A Study on the Wealth Effect and the Economy
What Marginal Utility Says About Consumer Choice
Intangible Assets Provide Real Value To Stocks
A man with money flying out of his wallet
Consumer Spending: Definition, Measurement, and Importance
Kelly Criterion: Definition, How Formula Works, History, and Goals
Businesswoman working in an office with a laptop on her desk, overlaid with financial bar graph
House Money Effect: Meaning, Examples and FAQs
How to Read the Michigan Consumer Sentiment Index
Cognitive vs. Emotional Investing Bias: What’s the Difference?
Anchoring in Investing: Overview and Examples
New York Stock exchange and the street in front of it
False Market
Save to Board Businesswoman Filling Survey Form On Mobile Phone
Michigan Consumer Sentiment Index (MCSI): What it Means, Uses
Investment Multiplier: Definition, Example, Formula to Calculate
Y2K: Shorthand for "the year 2000."
The Truth About Y2K: What Did and Didn't Happen in the Year 2000
Stock Chart With Fibonacci Retracement Indicator in Monitor Investment Concept
Multinomial Distribution: What it Means, Examples
Hyman Minsky at a podium
What Is a Minsky Moment? Definition, Causes, History, and Examples
Black Monday: Definition in Stocks, What Caused It, and Losses
Office Building
Confirmation Bias: Overview and Types and Impact
Human Development Index (HDI)
What Is the Human Development Index (HDI)?
Herd Instinct: Definition, Stock Market Examples, & How to Avoid
How Game Theory Strategy Improves Decision Making
Midsection Of Woman Holding Shopping Bags
Understanding the Consumer Confidence Index
Top 4 mistakes that cause futures traders to fail