Behavioral Economics

Also known as: Behavioral Science, Behavioral Insights, Consumer Psychology

Discipline integrating psychology and economics to understand how consumers make real—often irrational—decisions.

Behavioral Economics is a discipline that combines psychology and economics to understand how consumers actually make decisions, which frequently diverge from the 'rational consumer' model of classical economics.

Key behavioral economics concepts with direct research applications: Heuristics (mental shortcuts in decision-making), Cognitive biases (anchoring, loss aversion, decoy effect, status quo bias, social proof), System 1 vs. System 2 (Daniel Kahneman's automatic vs. deliberate thinking), and Nudging (choice architecture).

In market research, behavioral economics informs research instrument design (to minimize response biases), product and packaging design, and pricing and communication strategies.

Atlantia incorporates behavioral economics principles in questionnaire design to maximize the validity of obtained data.