LIRNEasia is a regional ICT policy and regulation think tank active across the Asia Pacific

Tag Archives: behavioral economics

ICT is making surge pricing possible, but caution is advised in avoiding outrage

The NYT piece suffers from peculiar worldview of American and European journalists who think all good innovations come from their part of the world (Singapore pioneered congestion pricing for road use in 1975), but let’s focus on the positive: the drawing out of lessons from Thaler and Springsteen about the need to address hardwired perceptions […]

Thaler and the demise of homo economicus

When I was studying economics in the 1980s, it was quite vulnerable to the criticism that the entire edifice was built on a shaky assumption: homo economicus. But now that Kahnemann, Thaler et al. have slain h.e., economics is that much stronger. I am happy that most people at LIRNEasia have been reading Thaler, Shiller, […]

Thinking automatically, thinking socially or thinking with mental models?

Box

How do YOU think? We tell ourselves that when people are faced with making a decision, they would make reasonable, well informed and carefully thought out decisions. Oftentimes, we think (unconsciously of course) that other people think in the same way that we ourselves do. But for the vast majority of time, this is just […]

Behavioral economics meets demand-side management

We’ve been arguing that electricity is up for a major change and that the change is going to be driven by the infusion of ICTs into all aspects of electricity generation, transmission, distribution and supply. Here’s another example. Hopefully this does not require smart meters and that high consumption devices in our countries can work […]

Demand side management beginning to catch in Sri Lanka

About a year back, we predicted that the new electricity tariff will shock people into changing behavior: “the currently proposed tariff structure will create “bill shock” among consumers, and nudge a certain percentage of consumers to voluntarily reduce demand. But this will be insufficient.” The evidence is in. It has happened. The 2013 Sri Lanka […]

Behavioral economics applied to the peak-load problem

In our recent intervention on Sri Lanka’s electricity tariffs, we offered to help the regulatory agency and the service suppliers apply the learnings of behavioral economics to the task of reducing the five percent of peak-load demand that was responsible for 17 percent of the total cost. In this oped, an author we quoted in […]

Nudge in effect at Google

We at LIRNEasia are seeking to apply nudge principles to how utilities (and governments) communicate with their customers (citizens). Therefore, it was not surprising that this caught my eye when reading about Google’s employee perks: So the candy (M&Ms, plain and peanut; TCHO brand luxury chocolate bars, chewing gum, Life Savers) is in opaque ceramic […]

“Do not track” and the power of the default

Behavioral economics has brought to the fore the power of the default. As big data makes it easier to understand people’s actual behaviors and guide their choices, the power of the default is beginning to be fought over. Interestingly, it’s Microsoft versus the rest. Next came an incensed open letter from the board of the […]

Adventures in behavioral economics

Universal acclaim rarely comes to a theorist who tries to implement his ideas. As administrator of the White House Office of Information and Regulatory Affairs, he reviewed the rules implementing President Obama’s health care act and the Dodd-Frank financial regulatory reform law. He backed major environmental initiatives, including higher fuel efficiency standards for cars and […]

Power of the default

Behavioral economics is becoming a major component of LIRNEasia’s toolkit. The discussion below refers to the decision architectures that appear to keep the money flowing into Google. But most people, of course, never make that single click. Defaults win. The role of defaults in steering decisions is by no means confined to the online world. […]

The Golden Age of Behavioral Research (and the funding cuts that may take the shine off)

I co-taught an experimental graduate seminar with one of my colleagues at Ohio State University in the early nineties where we explored what policy could learn from research on how people actually behaved, thought and decided. I taught the first half of the seminar by deconstructing various policy and regulatory debates (dominated by lawyers and […]

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