People, not a Machine

You have a goal – lose weight, turn your life around, climb Mt Everest – and you want to be sure to stick with it. What’s the best way to get you to make your goal? According to a pledge to a charity or a friend if you fail to achieve it is a powerful motivator. That’s what you do at this site and their results are amazing.

The reason? Fear of loss motivates far more than a possibility of gaining.

It’s not exactly rational, but it’s human behavior. Understanding behavior and what drives people to do what they do is called “Behavioral Economics”. It differs from classic economics in that it never presumes people are always rational and always seeking to maximize profit. We have other things that drive us personally and socially – happiness, fear, morality, and shame among them.

And an understanding of behavioral economics is just what’s often missing in business and public policy.

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