Aggregate effects of behavioral anomalies: A new research area

Bruno Frey and Jana Gallus

No 2013-51, Economics Discussion Papers from Kiel Institute for the World Economy

Abstract: Much recent research in economics focuses on exploring behavioral anomalies, i.e., systematic deviations from the assumptions of the rationally self-interested model of man. Laboratory studies are used to identify seeming inconsistencies with micro-economic theory on the level of individuals. Since economics is a social science, this article proposes that the next crucial step consists in shifting the focus to the macro-level. It examines the process through which behavioral anomalies are aggregated to a societal outcome. Since individuals are reactive when they interact with others and face institutional constraints, the aggregation process may lead to different outcomes than what has been observed in individual-level studies: the respective anomalies may disappear, or they may become stronger on the macro-level. The discussion demonstrates that there are a great number of aspects to be analyzed. The paper presents fragments of what could become a more extensive field of research.

Keywords: economics and psychology; behavioral economics; behavioral anomalies; reactivity (search for similar items in EconPapers)
JEL-codes: A10 B00 D70 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-evo and nep-hpe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Aggregate effects of behavioral anomalies: A new research area (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwedp:201351

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