Mental Models in Economics

Ivan N. Drogobytskyi ()

Economics of Contemporary Russia, 2019, issue 1

Abstract: It’s a well-known fact that contention of organizational management depends not only on current situation in managed system in managed system and its nearest surroundings, but also on persons who make decisions. Their experience, professionalism, intuition and feelings influence directly on quality of managerial decisions and finally they influence on positions of managed system in time and space. Social acceptance of this influence caused development of behavioral economics as a new branch of economic science. The last one explores the process of human decision-making in day-to-day life and the ways of its’ improving on the base of hidden abilities in human consciousness. In the same time behavioral economics tries to adopt the best achievements of the previous economical concepts (classical and neo-classical) on the evolutional way of civilizations’ development, as well as find the best practical using for them.One of the most important achievements in neo-classical economics is a model approach. It seems that in the behavioral economy, it will take its rightful place. In the present article, there’s an attempt to disclose the composition and content of mental models, which will form the basis of the model choice in the conditions of the behavioral economy. The main difficulty of such an idea is that the elements that form mental models, the connections between them and the environment are of an immaterial nature and are not given to us in sensations.Â

Date: 2019
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