Behavioural Economics and Decision Making in Business
Author(s): Dr. Krishna Murari Modi, Dr. (Smt.) Anita Modi
Publication #: 1706011
Date of Publication: 22.11.2017
Country: India
Pages: 80-88
Published In: Volume 3 Issue 6 November-2017
DOI: https://doi.org/https://doi.org/10.5281/zenodo.10886205
Abstract
Behavioural economics integrates insights from psychology and economics to understand how individuals make decisions. This paper explores the applications of behavioural economics in business and policy, highlighting key concepts such as biases, heuristics, and decision-making processes. Drawing on seminal research by Kahneman and Tversky, as well as contemporary studies, the paper examines how behavioural economics principles inform pricing strategies, marketing tactics, and policy interventions. Case studies illustrate the effectiveness of behavioural insights in influencing consumer behaviour, increasing savings rates, and promoting environmental conservation. Additionally, the paper discusses future directions and challenges for the field, including the replication crisis and ethical considerations. By leveraging behavioural economics, businesses and policymakers can design more effective strategies to address complex societal issues and improve decision-making outcomes.
Keywords: Behavioural economics, decision-making, biases, heuristics, business strategy, policy making, pricing strategies, marketing tactics, case studies, future directions.
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