Behavioural and Experimental Economics, S. Durlauf and L. Blume (eds.), The New Palgrave Economics Collection, Palgrave Macmillan, 2009, 51-58.
Interest in the field of psychology and economics has grown in recent years, stimulated largely by accumulating evidence that the neoclassical model of consumer decisionmaking provides an inadequate description of human behaviour in many economic situations. Scholars have begun to propose alternative models that incorporate insights from psychology and neuroscience. Some of the pertinent literature focuses on behaviours commonly considered ‘dysfunctional’, such as addiction, obesity, risky sexual behaviour, and crime. However, there is also considerable interest in alternative approaches to more standard economic problems such as saving, investing, labour supply, risk-taking, and charitable contributions.