Behavioral economist and New York Times bestselling author Dan Ariely offers a much-needed take on the irrational decisions that led to our current economic crisis.
In his uniquely charming and engaging style, Dan Ariely again examines our poor decision-making processes now on a broader canvas than ever before. Taking into account recent economic events, Ariely tackles one of the biggest crises of our times: the financial meltdown and sub-prime mortgage crisis of 2008 2009, and the irrational decisions that led us there. As Ariely explains, relying on standard economic theory alone might, in fact, be dangerous. The mistakes that we make are not random but irrational, and they can aggregate in the market with devastating results.
In this revised and expanded edition of PREDICTABLY IRRATIONAL, Ariely brings a much-needed dose of sophisticated psychology to the realm of public policy. In addition to reflecting on material covered in previous chapters and responding to the thought-provoking comments of his readers, he also answers pertinent questions like:
What caused individuals to take on mortgages that were too large?
What caused bankers to lose sight of the economy?
Why didn t we plan better for the possibility of bad times?
What do we need to do to get over these difficult times?
Is there a psychological fallout from not understanding what s going on in the markets?
Is it possible that a central and global market can increase irrational behavior?
Should we use the assumptions of rational economics as building blocks for setting up policies and designing our institutions?
Blending everyday experience with groundbreaking analysis and new research into today s economic climate, Ariely explains how expectations, emotions, social norms, and other invisible, seemingly illogical forces skew our reasoning abilities. The mistakes we make are systematic and predictable and in light of our current crisis, their consequences have never been more clear. This revised and expanded edition of PREDITABLY IRRATIONAL will change the way we interact with the world from the small decisions we make in our own lives, to the individual and collective choices that shape our global economy.
Why do our headaches persist after we take a one-cent aspirin but disappear when we take a fifty-cent aspirin?
Why do we splurge on a lavish meal but cut coupons to save twenty-five cents on a can of soup?
When it comes to making decisions in our lives, we think we're making smart, rational choices. But are we?
In this newly revised and expanded edition of the groundbreaking New York Times bestseller, Dan Ariely refutes the common assumption that we behave in fundamentally rational ways. From drinking coffee to losing weight, from buying a car to choosing a romantic partner, we consistently overpay, underestimate, and procrastinate. Yet these misguided behaviors are neither random nor senseless. They're systematic and predictable—making us predictably irrational.
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