Match each of the terms on the left with its definition on the right. Click on the term first and then click on the matching definition. As you match them correctly they will move to the bottom of the activity.
behavioral economics overconfidence hyperbolic discounting time- endowment effect loss aversion anchoring mental accounting sunk cost fallacy altruism econometrics experimental economics lab experiment natural experiment field experiment | A type of framing bias in which a consumer chooses a reference point around which losses hurt much more than gains feel good. Branch of economics that incorporates insights from human psychology into models of economic behavior. Tendency of people to place much greater importance on the immediate present than even the near future when making economic decisions. Research method in which randomizations are carried out in real- A belief that one’s skill and judgment are better than they truly are, or that better outcomes are more likely to happen than their true probability. A type of framing bias in which people divide their current and future assets into separate, nontransferable portions, instead of basing purchasing decisions on their assets as a whole. The mistake of allowing sunk costs to affect decisions. The phenomenon where simply possessing a good makes it more valuable; that is, the possessor must be paid more to give up the good than he would have paid to buy it in the first place. Test of an economic theory in a laboratory setting. A type of framing bias in which a person’s decision is influenced by specific pieces of information given. A randomization or near- Acts motivated primarily by a concern for the welfare of others. Field that develops and uses mathematical and statistical techniques to test economic theory. Branch of economics that relies on experiments to illuminate economic behavior. Consistencies in a consumer’s preferences in a given economic transaction, whether the economic transaction is far off or imminent. |