Forbes contributors publish independent expert analyses and insights. Hersh Shefrin analyzes how psychology impacts markets and policy. This article is more than 3 years old. The inflation which ...

Behavioral economics helps investors understand irrational market behaviors and customer choices. Examples of behavioral economic theories include loss aversion and sunk-cost fallacy. Recognizing ...

Editor’s Note: Dan Ariely, a noted behavioral economist at Duke University and author of Predictably Irrational, is different from many of his economist colleagues. Ariely studies irrationality in ...

For roughly two decades, the new science of behavioral economics has been challenging what economists call “rational choice theory.” Rational choice theory described that primate species called Homo ...

I have just given you $78. (I’m a generous guy.) Now I’m giving you a choice: you can enter a lottery where you have a 75% chance of losing that $78 and a 25% of keeping it, or you can hold on to $20 ...

As a behavioral economist, Dan Ariely studies the way people make economic decisions. His conclusion? We don't do it the way economists typically say we do. Instead, he finds, humans are "predictably ...

Dan Ariely is a behavioral scientist at MIT and the author of Predictably Irrational: The Hidden Forces that Shape Our Decisions.

Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Michael Boyle is an experienced financial professional with more than 10 years ...