| Abstract: |
The most important financial source for behavioral economics is the Russell
Sage Foundation (RSF). The most prominent behavioral economists among the
RSF’s twenty-six member Behavioral Economics Roundtable (BER) are Kahneman,
Tversky, Thaler, Camerer, Loewenstein, Rabin, and Laibson. The theoretical
core of behavioral economics made up of the work of these seven researchers is
positioned in opposition to Adam Smith/Hayek type of economics, as exemplified
by experimental economists Vernon Smith and Plott; and what is referred to as
‘mainstream’ or ‘traditional’ economics, meaning the neoclassical economics
that roughly builds on Samuelson. On the basis of an overview of the work of
these seven behavioral economists, a theoretical division can be observed
within behavioral economics. The first branch considers human decision-making
to be a problem of exogenous uncertainty, which can be analyzed with decision
theory. It employs traditional economics as a nor! mative benchmark and favors
a normative-descriptive(-prescriptive) distinction for economics. The second
branch considers human decision-making to be a problem of strategic
interaction, in which the uncertainty is endogenous. Its main tool is game
theory. It rejects traditional economics both positively and normatively. |