| Abstract: |
Behavioral economics is an innovative applied science. In the 1950s economic
rational choice models came under scrutiny. A theoretical critique emerged
that not all human beings strive for efficiency and rationality all the time.
Behavioral economics first drew attention to deviations from rationality and
discussed the non-applicability of rational choice models for depicting the
actual behavior of humans. During the 1970s, Amartya Sen formalized the
rational choice critique and published powerful examples of how economics
needs a reality check and backtesting of its core axioms of rationality,
efficiency and time consistency for actual real-world relevancy and external
validity of the standard rational choice claims. By 1979, the two
psychologists Daniel Kahneman and Amos Tversky presented a line of laboratory
experiments at universities that proved the rational choice theory to be
inaccurate to explain the real-world decision-making patterns of individuals.
The following behavioral economics revolution rewrote economics for accuracy
and predictability for actual human day-to-day choices and behavior.
Sociologists, political scientists, psychologists created a line of research
to describe how individuals actually decide during the first decade of the
2000s. Behavioral insights were then used to find ways how to ‘nudge’
individuals, communities and leaders to help others make better choices in
different domains, for instance such as finance, marketing, health and
well-being. Around the world, governmental officials and governance experts
adopted behavioral nudges and winks to create better choice architectures and
decision-making patterns. This paper describes the history of behavioral
economics with attention to North American roots and European interpretations
in order to then prospect future trends in behavioral economics. First, given
the enormous popularity behavioral economics has enjoyed in the most recent
decades, a general knowledge has formed about behavioral nudges. Libertarian
paternalism is – by now – limited when it comes to implicitly tricking
people into making choices based on well-known insights. A common body of
knowledge on behavioral aspects of choice patterns may lead to reactance if
people notice manipulation. The general population should therefore be trained
to make self-empowered choices that meet their individual principles, needs
and wants based on their behavioral expertise. Behavioral economists should
move from manipulating nudges to educating trainings of the layperson. Second,
the field of behavioral sciences has experienced a deep replication crisis
given major data cheating scandals and contemporary fraud allegations. General
oversight mechanism between co-authors, backtesting of effects for validity
and their general applicability is therefore warranted. he general population
should be trained to be critical of behavioral insights presented to them and
be encouraged by behavioral economists to feedback on the potential
non-applicability of p-hacked results. Third, online searchplace distortion of
behavioral economics results has become a sad reality for young behavioral
economists in the strategic search engine results manipulation through Search
Engine Disoptimization (SEDO). This implicit internet harassment calls for a
democratization of information and whole-rounded inclusion of thoughts online.
Behavioral economists should raise awareness for this negative competitive
behavior and work together with global governance institutions, regulatory
bodies but also industry professionals to curb negative internet search engine
manipulation and empower the upcoming generation of behavioral economists to
speak up when this is happening. Professional bodies should be informed to
help those whose career has been hit by competitive internet manipulation. All
these trends are speculated to lead to a revamped behavioral economics
revolution that demands for behavioral economics for all. The future of
behavioral economics is believed to lie in self-empowered leadership, not
manipulation. A democratization of behavioral economics information leading to
a general knowledge basis on actual behavioral patterns will guide a
self-empowered decision-making cadre within the general population. Search for
true and credible behavioral insights can lift the entire field to a more
helpful stage to become a standing guidepost for wise quality decision-making.
The digital millennium calling for fair internet use will hopefully prosper an
inclusive and diversified information on behavioral insights to be accessible,
useful and meaningful for all. |