Economics and the Honor System

When we pay through an honor system, retailers depend on our economic honesty while researchers are trying to understand it.

The Problem With Free Pizza

Not knowing what behavioral economists say about “zero,” the Russian Domino’s was surprised by the response to a free pizza promotion.

Why Free Stuff Can Be Expensive

Whether disappointed because MGM will now charge up to $10 for Las Vegas parking or happy to get free shipping, we know that the cost of free stuff is high.

What An Unemployment Rate Does Not Tell You

A single statistic like the unemployment rate for Japan, the European Union and the U.S. can be misleading until we look more closely at what it represents.

Behavioral Economics: Better than a Psychiatrist

After reading Murder at the Margin, some of my students suggested in essays that we do not need a psychiatrist to explain human behavior. Instead, just ask a behavioral economist. Let’s give it a try… Defaulting: In life, we tend…

Behavioral Economics: Insider Trading

Did you know that many college professors have encountered the dead granny phenomenon? Discussing dishonesty, behavioral economist Dan Ariely tells us that before a college midterm, a student’s grandmother is 10 times more likely to die and before a final…

Behavioral Economics: The Best Gifts

A gift can be worth much more or less than its price tag. It just depends on whether you are the giver or the receiver. One of the best gifts I have ever gotten was a book of car wash…

California Consumers and Gas Prices

How might California be responding to $5.00 gas? Let’s start with bread machines. Behavioral economist Dan Ariely explains that when one of the first sellers of bread machines placed it on the shelf, few people were interested because they could…

Was That Birthday Card Really Free?

Have you ever been delighted that you got something for free? I was until I read “the cost of zero cost” in Dan Ariely’s book, Predictably Irrational. My story begins at a Papyrus store in NYC. About to pay for several…

Why Might People Cheat?

When are people more likely to cheat? Behavioral economist Dan Ariely says to look at sweatshirts, the Ten Commandments, dollar bills and cans of Coca-Cola. In one experiment, Ariely discovered that more students would copy someone’s seemingly dishonest behavior during…