Neuroeconomics
Categories: Econ
Time to put on your thinking cap (if you haven't already).
Neuroeconomics is the combination of neuroscience, behavioral economics, and social psychology to explain how and why people make the decisions they do.
Economics likes to tout itself as a mathematical science these days, trying to fit in with the likes of physics and mathematical sciences. But the truth is that economics is about studying people, and if there’s one thing we know about studying people, it's that people aren’t homo economicus, the rational human we’d all like to think we are. Nope...we're homo sapiens, subject to irrational behavior.
Neuroeconomics brings interdisciplinary benefits to us: the complex beings we are, and our behavior. Combining economic concepts with the science of the brain, neuroeconomics attempts to explain human behavior better than any one discipline alone has done so far.
Key research areas are ones that stump us (why aren’t you being rational, humans?), such as risk-taking and loss aversion, intertemporal choice (procrastination nation), and social decision-making. Like...if everyone was standing backwards in an elevator, would you? Neuroeconomics says...probably yes.