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w23: Behavioural economics VIII /2548

Topic 3

Lecture handout

w23: Applications of behavioural economics / Figure

[Powerpoint handout version with note space]

Main reading

Ariely, D (2009), Predictably irrational – The hidden forces that shape our decisions (revised ed), London: Harper

Duhigg, C (2012), How Companies Learn Your SecretsNew York Times, Feb 16th

Economist (2010), The data delugeThe Economist, Feb 25th

Gabaix, X and Laibson, D (2005), Shrouded Attributes, Consumer Myopia, and Information Suppression in Competitive Markets, NBER Working paper 11755 [Published as Gabaix, Xavier and Laibson, David (2006), “Shrouded Attributes, Consumer Myopia, And Information Suppression In Competitive Markets,” Quarterly Journal of Economics, v121 (2, May), 505-540]

Huber, J and Puto, C (1983), Market boundaries and product choice: Illustrating attraction and substitution effectsJournal of Consumer Research, V10 No 1, June, pp31-44

Iyengar, S and Lepper, M (2000), When Choice is demotivating: Can one desire too much of a good thing?Journal of Personality and Social Psychology, Vol. 79, No. 6, pp995-1006

Iyengar, Sheena (2010), The art of choosing, London: Little, Brown [see her 2010 TED talk too]

Naughton, J (2019), ‘The goal is to automate us’: welcome to the age of surveillance capitalism, The Observer, Jan 20th [see also Bridle, J (2019), The Age of Surveillance Capitalism by Shoshana Zuboff review – we are the pawns, The Guardian, Feb 2nd]

Poundstone, William (2010a), Priceless: the myth of fair value (and how to take advantage of it), New York: Hill & Wang

Simonson, I and Tversky, A (1992), Choice in Context: Tradeoff Contrast and Extremeness Aversion, Journal of Marketing Research, Vol. 29, No. 3 (Aug.), pp. 281-295

Thaler, R (1985), Mental accounting and consumer choice, Marketing Science, Vol. 4, No. 3, Summer, pp. 199-214

Examples and illustration

Butler, S and Goodley, S (2015), Sports Direct: it’s all about discounts, but are they what they seem?The Guardian, Dec 10th

Clifford, S and Rampell, C (2013), Sometimes, We Want Prices to Fool UsNew York Times, April 13th

Poundstone, W (2017), The hidden psychology of menu design, Wired, April 10th

Sullivan, B (2012), ‘Fair and square’ pricing? That’ll never work, JC Penney. We like being shafted, Red Tape Chronicles on NBC News, May 25th

Other

BBC (2019), Behavioural science in the workplace, The Bottom Line, BBC Radio 4, Feb 16th [well worth a listen]