Global Educational Research Journal

Behavioral Economics: Understanding Consumer Decision-Making

This discourse study deals with one of the youngest branches of economic science, - behavioral neoclassical economics, and discusses its challenge to the traditional classical economics rational decision-making theories. The book comprising four chapters is quite comprehensive. The first chapter is a presentation of characterics and basic principles-behavioral economics in which the concept of bounded rationality, heuristics, and biases are contrasted with classical economic models is made clear. The second chapter emphasizes the different factors that determine consumer action that include among others cognitive biases, emotional drives, and existential pressures with specific instances that are closely related. At the third chapter, behavioral insights are not only discussed but also applied on the practical levels through case studies with the companies- and the politicians. Starbucks' non-cash payment system and United Kingdom's Tax Office efforts to improve fiscal compliance with the intelligent use of highly innovative ideas are outstanding among the many examples. In conclusion, the text deals with the future of behavioral economics as the chief interest with the intentions such as the conjoint integration of fields, such as psychology, and neuro-science, the harnessing data and artificial intelligence as well as the application of behavioral insights to face global issues of inequality and climate change. In essence, this work strongly suggests that the very elaborate transformations in research and practice, referring to the areas like the expansion and application of behavioral economics to increase the effect of decision-making frameworks and the viability of policies, are in the focus of this paper.

.

Keywords: Behavioral Economics, Consumer, Decision-Making