behavioral economics

In 1974, two psychologists, Daniel Kahneman and Amos Tversky, as the New Yorker once put it, "changed the way we think about the way we think." The prevailing wisdom, before their landmark research went viral (in the way things went viral in the 1970s), was that human beings were, for the most part, rational optimizers always making the kinds of judgments and decisions that best maximized the potential of the outcomes under their control. This was especially true in economics at the time. The story of how they generated a paradigm shift so powerful that it reached far outside economics and psychology to change they way all of us see ourselves is a fascinating tale, one that required the invention of something this episode is all about: The Psychology of Single Questions.

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Dr. Mitesh Patel is a physician and behavioral scientist! He helped found the Penn Medicine Nudge Unit, a first for healthcare. We talk about behavioral nudges, both for healthcare and home life, and the small things that we can each do to nudge behavior. Dr. Mitesh Patel MD MBA is a physician executive and behavioral scientist. He is currently Chief Clinical Transformation Officer at Ascension , the largest non-profit healthcare system in the US. He works on strategic vision and implementation of programs to transform clinical care using behavior nudges, EHR Apps, machine learning, artificial intelligence, remote patient monitoring, and virtual care. Previously, he was the Founding Director of the Penn Medicine Nudge Unit, the world’s first behavioral design team embedded within health system. 

When we make important decisions, we are often not as rational or objective as we’d like to believe. The base rate fallacy is the tendency to misjudge the probability of a situation by not accounting for all relevant information. This cognitive bias affects everything from first impressions to voting preferences to broad market behavior.

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More about our guest:

Merrick Furst, Ph.D., is a Distinguished Professor and the Director of the Center for Deliberate Innovation (CDI) at Georgia Tech. In 2011, he founded Flashpoint, a first-of-its-kind deliberate innovation studio, to develop formative leaders and exceptional technology startups. Flashpoint was the thirty-sixth startup accelerator worldwide, very early in the development of business accelerators. Both at Flashpoint and at CDI, Furst works with hundreds of founders and innovators and is developing the discipline of Deliberate Innovation. 

To date, Furst has personally started eight start-ups. Furst has been teaching entrepreneurship in an innovative form since 2006. He was a professor and the President of the International Computer Science Institute at UC Berkeley, and previously, was a professor and Associate Dean in the School of Computer Science at Carnegie Mellon. He received his Ph.D. in Computer Science from Cornell University. Furst is known for seminal research in algorithms, complexity theory, and AI. He co-invented probabilistic circuit analysis and planning graphs, which are considered among the most influential breakthroughs in the field of AI planning.  

Know more about him here:

• Dr. Merrick Furst

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Episode Guide:

00:54 - What is Innovation?

2:30 - Falling apart vs Continuous innovation

3:18 - What makes a customer?

4:33 - The puzzle of innovation and indifference dilemma

9:03 - Getting Stuck and Unstuck: Only Yes situations

13:49 - Innovation, education, and interdisciplinary knowledge

17:11 - Creating "threads" in curriculum

19:58 - Innovation, Daniel Kahneman's influence, and economics

22:03 - Innovation, utility, and P&G  

25:27 - Getting people to reassess

28:38 - Drawing from personal experience on demand and supply

31:13 - Advice for Innovators
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OUTLAST Consulting offers professional development and strategic advisory services in the areas of innovation and diversity management.

Guest: Jean-Manuel Izaret, Author

On Linkedin | https://www.linkedin.com/in/izaret/

On Twitter | https://twitter.com/izaret

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Host: Marco Ciappelli, Co-Founder at ITSPmagazine [@ITSPmagazine] and Host of Redefining Society Podcast

On ITSPmagazine | https://www.itspmagazine.com/itspmagazine-podcast-radio-hosts/marco-ciappelli
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Episode Introduction

In a world where economic dynamics intricately intertwine with our daily lives, understanding the nuances of strategic pricing becomes imperative. This is the central theme of the latest episode of the "Redefining Society Podcast," where we engage in a thought-provoking conversation with Jean-Manuel Izaret, co-author of "Game Changer: How Strategic Pricing Shapes Businesses, Markets, and Society."

The episode begins with a reflection on the often-overlooked significance of pricing in technology and societal contexts. We question whether strategic pricing truly belongs in discussions about technology and its societal impact, only to discover its undeniable relevance. As Izaret points out, pricing strategies do more than just set the cost of goods and services; they shape consumer behavior, influence market trends, and even hold the power to dictate the course of society.

Izaret, with a rich background in economics and behavioral science, brings a unique perspective to the table. Drawing from his extensive experience in consulting and pricing strategy formulation, he discusses the evolution of pricing from a mere transactional element to a strategic tool capable of influencing societal outcomes. The concept of the Strategic Pricing Hexagon, introduced in the book, serves as a gateway to understanding how strategic decisions regarding pricing can lead to stronger growth and improved financial performance for businesses.

The conversation delves deeper into the psychological and sociological aspects of pricing. We explore how prices affect our purchasing decisions, the value we assign to products, and even our perception of brands. Izaret uses relatable examples, like the luxury branding of Gucci or the dynamics of the tipping culture, to illustrate these points. These examples highlight the complex relationship between pricing, consumer expectations, and societal norms.

Furthermore, the episode addresses the global impact of pricing strategies. In a world increasingly interconnected, a pricing decision in one part of the globe can have ripple effects elsewhere. This global perspective is crucial in understanding the role of strategic pricing in shaping not just local markets but the global economic landscape.

As the conversation unfolds, it becomes clear that strategic pricing is not just about numbers and profit margins. It's about understanding human behavior, societal values, and market dynamics. It's a tool that, when wielded wisely, can contribute to the greater good, promoting sustainable and equitable growth.

By the end of the episode, listeners are left with a newfound appreciation for the power of pricing. It's no longer a dry, technical topic relegated to economics textbooks. Instead, it emerges as a vibrant, dynamic field that intersects with technology, society, and human psychology, influencing our lives in profound ways.

📖 About the Book:

The right pricing strategy can change the entire trajectory of a business, a market, and even society at large. To help you create your best pricing strategy efficiently and confidently, two leaders from BCG are introducing fresh perspectives on pricing that take you far beyond the realm of mind-numbing numbers.

In their new book Game Changer: How Strategic Pricing Shapes Businesses, Markets, and Society, Jean-Manuel Izaret and Arnab Sinha simplify and clarify pricing strategy by integrating its many frameworks and concepts into seven distinct pricing games, each with its own proven tools, rules, forces, and structures. To help you pick the right game and play it well, Izaret and Sinha have developed the Strategic Pricing Hexagon, a tool refined through years of testing, iteration, and adaptation. The Hexagon is your portal to a business world where stronger growth and better financial performance come from a set of strategic pricing decisions, not endless myopic quests for optimal prices.

But more than that, the Hexagon will change the way you think about and talk about pricing. The current conversation around pricing – as expressed through economics textbooks, Excel spreadsheets, political discourse, and educated guesswork – makes it easy to believe that pricing is nothing more than a technical, tactical and, for most people, boring game of numbers. Game Changer changes that conversation bysharing stories and research that bring the Hexagon and its seven pricing games to life.

With research from BCG’s Bruce Henderson Institute and real-world examples from the world's most influential companies, the authors and their colleagues at BCG define pricing strategy as a business leader’s or business owner’s conscious decisions about how money flows in their market. They show how companies succeed in the long term when they focus on collaborative growth and value sharing with customers, not zero-sum value extraction from them.

Discover how you can create and implement a winning pricing strategy that changes the trajectory of your business, your market, and even society.

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Resources

Game Changer: How Strategic Pricing Shapes Businesses, Markets and Society: https://www.amazon.com/Game-Changer-Strategic-Pricing-Business/dp/1394190581#:~:text=%E2%80%9CGame%20Changer%20elevates%20pricing%20from,%2Dto%2Dmarket%20strategies.%E2%80%9D

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To see and hear more Redefining Society stories on ITSPmagazine, visit:
https://www.itspmagazine.com/redefining-society-podcast

Watch the webcast version on-demand on YouTube: https://www.youtube.com/playlist?list=PLnYu0psdcllTUoWMGGQHlGVZA575VtGr9

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A train was speeding along the tracks in 19th-century England when a passenger suddenly started smashing windows and waving a pistol in the air. People believed his actions were caused by what was, at the time, a new and unfamiliar form of transportation. Doctors posited the rattling motion and noise of trains could cause passengers to act erratically, creating the short-lived but popular myth of "railway madness."

In this episode of Choiceology with Katy Milkman, we look at how people often overreact to poor quality or incomplete information.

A sudden explosion in 1889 ripped apart the USS Maine, the United States' largest warship at the time. The ship sank, killing more than half of the sailors on board. The Maine had been anchored in Cuba, and despite having little proof, the American public immediately blamed the Spanish for the sinking. Newspaper editors published headlines such as "Remember the Maine, to Hell with Spain!" Nearly a hundred years later, an underwater investigation would reveal what likely caused the explosion.

Historian David Silbey recounts how public pressure from this tragedy pushed the United States to make a decision that would have lasting consequences for the world. 

David Silbey is a military historian and adjuncta professor and director of teaching and learning at Cornell University. He is also the author of A War of Frontier and Empire: The Philippine-American War, 1899-1902. His new book is called Wars Civil and Great: The American Experience in the Civil War and World War I. 

Next, Katy speaks with Ned Augenblick about his research that shows people's tendency to overreact to weakly supported information and underreact to strongly supported information. 

You can read more in the paper he co-authored with Eben Lazarus and Michael Thaler, called "Overinference from Weak Signals and Underinference from Strong Signals." 

Ned Augenblick is a professor in the Economic Analysis and Policy Group at the Haas School of Business at the University of California, Berkeley.

Choiceology is an original podcast from Charles Schwab. 

If you enjoy the show, please leave a rating or review on Apple Podcasts.

Important Disclosures

The comments, views, and opinions expressed in the presentation are those of the speakers and do not necessarily represent the views of Charles Schwab.

​Data contained herein from third party providers is obtained from what are considered reliable source. However, its accuracy, completeness or reliability cannot be guaranteed and Charles Schwab & Co. expressly disclaims any liability, including incidental or consequential damages, arising from errors or omissions in this publication.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request. 

Investing involves risk including loss of principal.

The book How to Change: The Science of Getting from Where You Are to Where You Want to Be is not affiliated with, sponsored by, or endorsed by Charles Schwab & Co., Inc. (CS&Co.). Charles Schwab & Co., Inc. (CS&Co.) has not reviewed the book and makes no representations about its content.

​Apple, the Apple logo, iPad, iPhone, and Apple Podcasts are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.

Google Podcasts and the Google Podcasts logo are trademarks of Google LLC.

Spotify and the Spotify logo are registered trademarks of Spotify AB.

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Discover the fascinating world of incentives and their impact on human behavior, innovation, and ethical considerations with Uri Gneezy and Guy Kawasaki on the Remarkable People podcast. Join this insightful conversation and explore the value of a college degree, innovation strategies, and the unintended consequences of incentives. Listen now and gain new insights into the power of incentives in shaping our world.

Remember to follow the show so you don't miss upcoming episodes!

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Guy Kawasaki is on a mission to make you remarkable. His Remarkable People podcast features interviews with remarkable people such as Jane Goodall, Neil deGrasse Tyson, Marc Benioff, Woz, Kristi Yamaguchi, and Bob Cialdini. Every episode will make you more remarkable.

With his decades of experience in Silicon Valley as a Venture Capitalist and advisor to the top entrepreneurs in the world, Guy’s questions come from a place of curiosity and passion for technology, start-ups, entrepreneurship, and marketing. If you love society and culture, documentaries, and business podcasts, take a second to follow Remarkable People.

Listeners of the Remarkable People podcast will learn from some of the most successful people in the world with practical tips and inspiring stories that will help you be more remarkable.
Episodes of Remarkable People organized by topic: https://bit.ly/rptopology

Listen to Remarkable People here:https://podcasts.apple.com/us/podcast/guy-kawasakis-remarkable-people/id1483081827

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Like this show? Please leave us a review -- even one sentence helps! Consider including your Twitter handle so we can thank you personally!

Thank you for your support; it helps the show!

Ed Powers, engineer by training and reformed salesman, joins the pod to discuss the science of how humans categorize experiences and make decisions, and how it is that Customer Success practitioners can use this knowledge to their advantage.

Who is Ed Powers?

• LinkedIn
• Service Excellence Partners

About this podcast:

If you like what you've heard,  please rate this podcast and subscribe to be notified of new episodes.

This podcast is written, produced, and edited by Dillon Young.  You can find him on LinkedIn.

Please direct all inquiries to dillon@lifetimevaluepodcast.com.

Find us on Instagram and TikTok at @lifetimevaluepodcast.

Do you always make the best possible choices, even when you’re stressed or short on sleep? The ideally rational person (“Homo economicus”) assumed by conventional economics always acts in ways that are materially advantageous to them. But Associate Professor Frank Schilbach seeks in his research and teaching to explore the ways in which Homo economicus fails as a model of actual human behavior; in particular, Prof. Schilbach is interested in uncovering the psychological factors that influence people’s choices, even when those choices appear obviously counterproductive and irrational. In this episode, Prof. Schilbach discusses how psychologically-informed interventions can not only boost people’s productivity, earnings, and savings, but can even increase their tendency toward benevolence and cooperation. As he puts it, while economists have not ignored mental health altogether, they have tended to view it instrumentally, in terms of its effects on productivity or financial stability. It would be better, he suggests, to view mental health as valuable for its own sake, as an inherent element of overall well-being–which is why he prioritizes students’ mental health by making assignments due not first thing in the morning but at 6 or 8 PM!

Relevant Resources:

MIT OpenCourseWare 

The OCW Educator Portal 

Professor Schilbach’s behavioral economics course on OCW

Professor Schilbach’s faculty page

Professor Schilbach at the Abdul Latif Jameel Poverty Action Lab

Music in this episode by Blue Dot Sessions

Connect with Us:

If you have a suggestion for a new episode or have used OCW to change your life or those of others, tell us your story. We’d love to hear from you! 

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Credits:

Sarah Hansen, host and producer 

Brett Paci, producer  

Dave Lishansky, producer 

Show notes by Peter Chipman

In this episode of the CUNA News Podcast, behavioral economist and author Melina Palmer provides us with a new understanding of behavioral science and economics. More importantly, she explains how we can use behavioral science to improve our organizations and our day-to-day lives. 

In this episode Professor Goldsmith talks with Professor Elizabeth Linos, director of The People Lab and an expert in data and evidence-based policymaking who researches how to best support the people of government and the communities they serve. They discuss Linos' path from practitioner to academic, the role of geographic data in service improvement, and how behavioral science can help governments do more with less.  

Music credit: Summer-Man by Ketsa

About Data-Smart City Solutions

Data-Smart City Solutions, housed at the Ash Center at Harvard Kennedy School, is working to catalyze the adoption of data projects on the local government level by serving as a central resource for cities interested in this emerging field. We highlight best practices, top innovators, and promising case studies while also connecting leading industry, academic, and government officials. Our research focus is the intersection of government and data, ranging from open data and predictive analytics to civic engagement technology. We seek to promote the combination of integrated, cross-agency data with community data to better discover and preemptively address civic problems. To learn more visit us online and follow us on Twitter. 

Tune in to hear:

- What can magic teach us about behavioral science and psychology and how does Paul marry these two worlds together?

- How do magicians see the world differently? Does magic make you more or less skeptical and do you now move through the world differently as a result of knowing about the art of how the mind fools us and how we fool each other?

- What are the evolutionary origins of behavioral bias and what are the implications of overcoming them?

- In his years of study in the field, what is one finding from the behavioral science literature that he finds personally fascinating and under discussed?

- Where can behavioral science help us improve our ability to sell?

- Does behavioral science have something to tell us about how to have less transactional, deeper relationships with our clients?

https://www.paulcraven.com

Compliance Code: 1862-OAS-10/6/2022

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Tune in to hear:

- What can Alex share about his financial literacy startup, Futurvest, and what needs or gaps did he see in the financial literacy space? 

- Knowing what we know about behavior, what does effective financial literacy education look like?

- Is there a way we can take the fight of financial literacy to an institutional level? Also, is there any hope of having financial literacy win out when large companies often monetize people’s poor financial decisions?

- If Alex had to do it all over again, with two decades of experience behind him, what would he do differently as an advisor?

- What is Alex’s niche and how does he differentiate himself from 300,000 peers? 

- Where does Alex think the financial service industry will be in 25 years from now?

- How has Alex’s relationship with his clients changed him for the better?

https://www.lakeavefinancial.com

https://www.futurvest.com

Compliance Code: 1358-OAS-8/1/2022

Tune in to hear:

- What are some of the psychological mechanisms that make our vision of ourselves so cloudy at times?

- If Melina hoped to draw out a deeply personal answer to the question “what are your financial goals,” how would she go about constructing the question?

- What are the hallmarks of a psychologically sophisticated brand and what is the psychological impact of this authenticity?

- What is the “surprise and delight” approach and why isn’t it more ubiquitous in customer service and UI design?

- How can we protect ourselves against being on autopilot as consumers? How do business owners encourage getting their clients in this kind of groove?

- How is pricing strategy a lot more complicated than it seems on the surface?

https://thebrainybusiness.com

Compliance Code: 1274-OAS-7/20/2022

Make sure to follow the show so you don't miss upcoming episodes!

Past guests on Guy Kawasaki’s Remarkable People Podcast: Dr. Jane Goodall, Salesforce CEO Mark Benioff, Netflix’s Dream Home Makeover stars Shea and Syd  McGee of McGee Studios, Daniel Pink, Tiny Habit’s author BJ Fogg, Dave Evans author of Designing your Life, The Artist’s Way author Julia Cameron, Entrepreneur and host of Smart Passive Income PAT FLYNN, Seth Godin, Hollywood director Jon M. Chu, indie author Hugh Howey, Rich Benoit of Rich Rebuilds, Dr. Robert Cialdini, Mark Manson, Martha Stewart, Brandi Chastain, Star of Netflix's Skin Decision Dr. Sheila Nazarian, Luvvie Ajayi Jones, Dr. Sinan Aral, Scott Galloway, Canva CEO Melanie Perkins, iJustine, Kristi Yamaguchi, Chef Roy Yamaguchi, Celebrity Chef Andrew Zimmern, Gary Vaynerchuk, Sir Ken Robinson, Steve WOZ Wozniak, Ariana Huffington, Wee Man of Jack Ass fame, Margaret Atwood, Stephan Wolfram, Dr. Phil Zimbardo The Stanford Prison Experiment, and new remarkable people each Wednesday!