Monday, June 14, 2010

Testing is important, intuition...not so much

One of my favorite topics in economics has always been the idea of rational vs. irrational decisions and how we can understand why people do the things they do.  This is really at the heart of economics, as the monetary system is just another way to place a value on making specific decisions.  If you have ever heard of things like the prisoner's dilemma, the tragedy of the commons, or the concept of util's, then you probably know what I am talking about.  Dan Ariely takes it a step further into the world of social science and really challenges what we think about rational decisions and intuition.  Check out this TED lecture on his experiments on cheating, it might make you think twice about what your own intuitions.