Is behavioural economics moralising?
A slight misunderstanding here (in my opinion) from datacharmer at the Bluematter blog. Tim Harford: "...[was too fascinated with] behavioural economics. But the financial system did not fail because of some psychological trait, but because it was riddled with damaging incentives" In other words, let's get over evil bankers and the belief that moralizing will change the world, and let's focus on incentives. But behavioural economics is not about moralising, nor is it about blaming individuals for making mistakes in the hope that they won't make them again. It's about understanding why and how people behave the way they do; so that when we do design incentives, they will work. Of course people respond to incentives. What else would they respond to? But if you think they respond consistently, transitively, stably, and (in the technical economic definition ) rationally*, to incentives, you'll be sorely disappointed. Even the most famous exampl...