The role of Behavioural Economics in Shaping Consumer Decision-Making
DOI:
https://doi.org/10.29070/f8pz6581Keywords:
Traditional, utility, theory, rationally, economicsAbstract
Our understanding of consumer decision-making has been transformed by behavioural economics, which combines psychological insights with traditional economic theory. Research in this field challenges the rationality-based assumptions of conventional economics by examining the impact of customers' emotions, social influences, and cognitive biases on their purchase choices. This article will examine key concepts in behavioural economics and how they may guide policymakers and businesses to better serve their constituents. Behavioural economics is a new field that combines insights from psychology and economics to provide a fresh look at consumer decision-making. Standard economic theory states that people act rationally and choose courses of action that maximise their own gain.
References
B. Amarnath Reddy, G N P V Babu, R K Sant, Punam Ahlawat, Subharun Pal, Sudeshna Pahari. (2024). Behavioral Economics and Consumer Decision-Making: Insights from Experimental Research. European Economic Letters (EEL), 14(3), 1258–1265. Retrieved from https://eelet.org.uk/index.php/journal/article/view/1887
Zandstra, Elizabeth H; Miyapuram, Krishna P; Tobler, Philippe N (2013). Understanding consumer decisions using behavioral economics. In: Chandrasekhar Pammi, V S; Narayanan, Srinivasan. Decision Making - Neural and Behavioural Approaches. Amsterdam: Elsevier, 197-211. DOI:10.1016/B978-0-444-62604-2.00012-5
Abhyankar, Aditi. (2022). Behavioural Economics Towards Better Decision Making. Journal of Global Economy. 16. 1-10. 10.1956/jge.v16i2.648.
Beata Mäihäniemi(2022) The role of behavioural economics in shaping remedies for facebook's excessive data gathering.
Asilbek Usmanov (2024) the role of behavioral economics in consumer decision-making
Kahneman, Daniel., Knetsch, L. Jack., and Thaler, H. Richard (1991) Anomalies: The Endowment Effect, Loss Aversion and Status Quo Bias. Journal of Economic Perspectives, Vol 5, Issue 1, pp.193-206.
Loewenstein, G., & Lerner, J. S. (2003). The role of affect in decision making. In R. J. Davidson, K. R. Scherer, & H. H. Goldsmith (Eds.), Handbook of Affective Sciences (pp. 619-642). Oxford University Press.
Madrian, B. C., & Shea, D. F. (2001). The power of suggestion: Inertia in 401(k) participation and savings behavior. The Quarterly Journal of Economics, 116(4), 1149-1187.
Ningbo Hanworth Kent School, Nibo, Zheijiang. Research on Consumer Based on the perspective of Behavioral Economics.
Ostrom, Einor (1998) A Behavioral Approach to the Rational Choice Theory of Collective Action: Presidential Address, American Political Science Association, 1997. American Political Science Review. Cambridge University Press, Vol. 92, Issue 1, pp.1-22.
Sunstein, C. R. (2014). Nudging: A very short guide. Journal of Consumer Policy, 37, 583-588. Thaler, R. H. (1980). Toward a positive theory of consumer choice. Journal of Economic Behavior & Organization, 1(1), 39-60.
Thaler, R. H., & Sunstein, C. R. (2008). Nudge: Improving decisions about health, wealth, and happiness. Yale University Press.
Tversky, A., & Kahneman, D. (1974). Judgment under uncertainty: Heuristics and biases. Science, 185(4157), 1124-1131.
Ariely, D. (2008). Predictably Irrational: The Hidden Forces That Shape Our Decisions. HarperCollins.
Johnson, E. J., & Goldstein, D. (2003). Do defaults save lives? Science, 302(5649), 1338-1339.
This work is licensed under a 