Theory Vs. Reality: Why Our Economic Behavior Isn't Always Rational

Reality: Why Our Economic Behavior Isn't Always Rational Enlarge this image toggle caption MediaNews Group via Getty Images MediaNews Group via Getty Images We don't always behave the way economic models say we will. We've seen this during the coronavirus crisis: People selflessly mobilizing to help each other, like the retired Kansas farmer who sent an N95 mask to New York to help a nurse or a doctor. In almost every sphere, our public and economic policies are designed around the assumption that most of us are going to behave like the first man. This week on Hidden Brain, we talk with two behavioral economists — Sam Bowles and Richard Thaler — about why economic models of human behavior regularly fail to describe how people actually behave.