Winner of the Nobel Memorial Prize in Economic Sciences
While the rationale behind economics always seems to be at the forefront of political and institutional life, many economic theories in relation to consumer behavior have not been studied in detail. Here, in The Winnerâs Curse, Richard Thaler challenges todayâs accepted economic wisdom by revealing many of the anomalies that abound even in simple economic transactions. He presents literate, challenging, and often funny examples of such variances as why the winners at auctions are often the real losersâthey pay too much and suffer the âwinnerâs curseââwhy gamblers bet on long shots at the end of a losing day, why shoppers will save on one appliance only to pass up the identical savings on another, and why sports fans who wouldn't pay more than $200 for a Super Bowl ticket wouldnât sell one they own for less than $400. He also demonstrates that markets do not always operate with the traplike efficiency we impute to them.
Thaler argues that recognizing these sometimes counterintuitive facts of economic behavior will compel economists to adopt a more balanced view of human nature, one reflected in Adam Smithâs belief that, despite our selfishness, there is something in our nature that prompts us to enjoy, even promote, the happiness of others.