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B Behavioral Economics

Behavioral economics explores what affects people’s economic decisions and the consequences of those decisions for market prices, returns, and resource allocation. Traditional economic research assumes that people’s economic decisions are based on the rule of maximizing utility. Behavioral economics, in contrast, neither assumes that people are good in utility maximization nor that it is people’s only goal. Using empirical tools, behavioral economists have shown rather that people have psychological biases, limited cognitive resources, and care about other values such as fairness, all of which might undermine their utility maximization behavior. Behavioral economic research and insights began slowly influencing the study and practice of business ethics in the 1990s, but have not yet had a substantial and widespread impact on the field of bioethics. Further study is needed on the intersections of bioethics and behavioral ethics to better understand the implications and impact each field can have on the other.