Title: Importance of economics in our daily lives - Economics Help
Headings: Importance of economics in our daily lives
Importance of economics in our daily lives
Summary – why economics is important
Economic choices – opportunity cost
Choice of study vs leisure
Work
Nudges and rational behaviour
Behavioural economics and bias
Importance of the macroeconomy on our daily lives
How to survive a period of inflation?
How will we be affected by rising interest rates?
Investing
Externalities
Limitations of economics
Related

Content: However, behavioural economists note that we are often influenced by irrational and non-utility maximising influences. For example, companies which ‘ nudge ‘ us to make decisions which harm our welfare – e.g. super-sized portions, we don’t really need but cause us to become less healthy. The importance of the insights of behavioural economics is that we can become aware of factors which may cause us to make sub-optimal decisions. We can try to resist commercial nudges – which encourage us to consume goods which don’t really benefit us. Behavioural economics and bias
A recent development in economics is the work of behavioural economics – which places more emphasis on elements of psychology. For example, are humans really rational utility maximisers – as suggested by traditional economic theory? Behavioural economics suggests not – but humans are influenced by emotional factors, such as loss aversion (we prefer the status quo, to losing what we have), present time period bias. Importance of the macroeconomy on our daily lives
When making decisions we don’t tend to first look at leading economic indicators. But, perceptions about the economic outlook can influence certain decisions. For example, those aware of the current economic situation may be aware the depth of the recession which makes a period of low-interest rates more likely.