behavioral economics

American  

[bih-heyv-yer-uhl ek-uh-nom-iks, eekuh-] / bɪˈheɪv yər əl ˌɛk əˈnɒm ɪks, ˌikə- /

noun

(used with a singular verb)

1. the branch of economics dealing with the effects of psychological, emotional, cultural, and social factors on individual or group economic decision-making, as distinguished from classical economics, which assumes that people will make the optimal economic decisions based on rational self-interest and utility.

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Etymology

Origin of behavioral economics

First recorded in 1955–60

Example Sentences

To dig deeper, the researchers built a mathematical model using tools from game theory and behavioral economics.

From Science Daily • Mar. 2, 2026

As Mr. Thaler reports, “despite the empirical robustness and conceptual importance of these findings, insights from behavioral economics remain largely absent from mainstream economics textbooks.”

From The Wall Street Journal • Dec. 26, 2025

But here’s where behavioral economics and investment strategy diverge: I don’t need everyone to follow through.

From MarketWatch • Oct. 17, 2025

Because even behavioral economics sometimes sees it as rational and scientific, and any deviation from it needs to be explained as some weird paradox.

From Salon • Feb. 1, 2025

Kahneman received the Nobel Prize in economics in 2002 for these and other contributions that ended up underpinning the discipline now known as behavioral economics.

From Seattle Times • Mar. 27, 2024