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: Which job will give the most satisfaction? It is not just about finding a well-paid job, we tend to gain most job satisfaction when we feel part of the process and a degree of responsibility and influence. Behavioural economists such as Dan Ariely have examined motivations for work and find that income/bonuses is less important than suggested by neo-liberal economic theory. Nudges and rational behaviour
In traditional economics, it is assumed individuals are rational and utility maximising. In other words, it is assumed we calculate decision to maximise our economic welfare – spending money only on those goods which give us satisfaction. 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.