This book explores human decision-making heuristics and studies how nudging and winking can help citizens to make rational choices. By applying the behavioral economics approach to political outcomes, it demonstrates how economics can be employed for the greater societal good. It starts with a review of the current literature on human decision-making failures in Europe and North America, presenting the wide range of nudges and winks developed to curb the harmful consequences of human decision-making fallibility. It then discusses the use of mental heuristics, biases and nudges in the finance domain to benefit economic markets by providing clear communication strategies. Lastly, the author proposes clear leadership and followership directives on nudging in the digital age. This book appeals to scholars and policy makers interested in rational decision-making and the use of nudging and winking in the digital age.
In: Springer eBook Collection
Intro -- Preface -- Contents -- Behavioral Foundations -- 1 Behavioral Economics -- 1.1 Introduction -- 1.2 Theoretical Background -- 1.3 Individual Decision-Making Under Uncertainty -- 1.3.1 Homo Nudgiens -- 1.3.2 Bounded Rationality and Ethicality -- 1.3.3 Mental Temporal Accounting -- 1.3.4 Evolutionary-Grown Human Decision-Making -- References -- Digital Behavioral Economics -- 2 Communication in the Twenty-First Century -- 2.1 Nudging and Winking in the Digital Era -- 2.1.1 On the Collective Soul of Booms and Busts -- 2.1.2 Nudging and Winking from the Supply and Demand Sides -- 2.1.3 Nudgital: Critique of Behavioral Political Economy -- 2.1.4 The Nudging Divide in the Twenty-First Century -- References -- Behavioral Finance -- 3 Value at Looking Back -- 3.1 Reflexivity in Socio-economic Backtesting -- 3.2 Results -- 3.3 Discussion -- References -- 4 Financial Behavioralism: A Behavioral Finance Approach to Minimize Losses and Maximize Profits from Heuristics and Biases -- 4.1 Diversifying Nudges -- 4.2 Crises-Robust Market Options -- 4.3 Long-Term Sustainable Market Options -- 4.4 Demographics -- 4.5 Tangibility -- 4.6 Safe Havens -- References -- 5 Market Communication -- 5.1 Too Much Information -- 5.2 Too Little Information -- 5.3 Social Phenomenon and Leaders in the Field -- 5.4 Time of Information -- 5.5 Firm-Biased Information -- 5.6 Medium Bias -- 5.7 Availability Biases -- 5.8 Quality of Information -- 5.9 Good News Breeding Overconfidence -- 5.10 Bad News -- References -- The Future of Behavioral Economics -- 6 Artificial Intelligence and Nudging -- 6.1 Artificial Intelligence Market Disruption -- 6.1.1 Slowbalisation -- 6.2 Macroeconomic Modeling -- 6.2.1 Discussion -- 6.3 Big Data Ethics -- 6.3.1 Utility -- 6.3.2 Dignity -- 6.3.3 Information Sharing and Privacy -- 6.3.4 The Humane Preference for Communication.
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