Behavioral Economics and Finance Leadership: Nudging and Winking to Make Better Choices
by Julia Puaschunder (Author)  

About this Book
This book explores human decision-making heuristics and studies how nudging and winking can help citizens to make rational choices. By applying the behavioral economics approach to political outcomes, it demonstrates how economics can be employed for the greater societal good.

It starts with a review of the current literature on human decision-making failures in Europe and North America, presenting the wide range of nudges and winks developed to curb the harmful consequences of human decision-making fallibility. It then discusses the use of mental heuristics, biases and nudges in the finance domain to benefit economic markets by providing clear communication strategies. Lastly, the author proposes clear leadership and followership directives on nudging in the digital age. This book appeals to scholars and policy makers interested in rational decision-making and the use of nudging and winking in the digital age.

Brief Contents
Part I Behavioral Foundations
1 Behavioral Economics 3
    1.1 Introduction 3
    1.2 Theoretical Background 5
    1.3 Individual Decision-Making Under Uncertainty 6
        1.3.1 Homo Nudgiens. 7
        1.3.2 Bounded Rationality and Ethicality 7
        1.3.3 Mental Temporal Accounting 19
        1.3.4 Evolutionary-Grown Human Decision-Making 31
    References 32
Part II Digital Behavioral Economics
2 Communication in the Twenty-First Century 45
    2.1 Nudging and Winking in the Digital Era 45
        2.1.1 On the Collective Soul of Booms and Busts 46
        2.1.2 Nudging and Winking from the Supply and Demand Sides 48
        2.1.3 Nudgital: Critique of Behavioral Political Economy 49
        2.1.4 The Nudging Divide in the Twenty-First Century 54
    References 57
Part III Behavioral Finance
3 Value at Looking Back 61
    3.1 Reflexivity in Socio-economic Backtesting 61
    3.2 Results 64
    3.3 Discussion 69
    References 73
4 Financial Behavioralism: A Behavioral Finance Approach to Minimize Losses and Maximize Profits from Heuristics and Biases 75
    4.1 Diversifying Nudges 75
    4.2 Crises-Robust Market Options 77
    4.3 Long-Term Sustainable Market Options 81
    4.4 Demographics 82
    4.5 Tangibility 83
    4.6 Safe Havens 83
    References 83
5 Market Communication 89
    5.1 Too Much Information 89
    5.2 Too Little Information 90
    5.3 Social Phenomenon and Leaders in the Field 90
    5.4 Time of Information 93
    5.5 Firm-Biased Information 93
    5.6 Medium Bias 93
    5.7 Availability Biases 94
    5.8 Quality of Information 94
    5.9 Good News Breeding Overconfidence 95
    5.10 Bad News 95
    References 95
Part IV The Future of Behavioral Economics
6 Artificial Intelligence and Nudging 101
    6.1 Artificial Intelligence Market Disruption. 101
        6.1.1 Slowbalisation 103
    6.2 Macroeconomic Modeling 107
        6.2.1 Discussion 119
    6.3 Big Data Ethics 134
        6.3.1 Utility 137
        6.3.2 Dignity 137
        6.3.3 Information Sharing and Privacy 138
        6.3.4 The Humane Preference for Communication 138
        6.3.5 Privacy as a Human Virtue. 139
        6.3.6 Privacy in the Digital Big Data Era 140
        6.3.7 A Utility Theory of Privacy and Information Sharing. 141
    References 144
7 Discussion 151
    7.1 Behavioral Economics. 156
    7.2 Discounting 157
    7.3 On the Collective Soul of Economics 158
    7.4 Public-Sector Implications 161
    7.5 Legal and Global Governance Implications 163
    References 167
8 Conclusion 169
    References 181

Print Length : 183 pages
Publisher : Springer; 1st ed. 2020 Edition (October 19, 2020)
ASIN : B08LGCFR23
Language : English