Predictably Irrational

4.5 stars out of 5

This highly entertaining book should be required reading for all budding economists. It is accessible to all students and details, using scientific experiments, how we make irrational decisions. Many economists push the idea that everything we do is rational, given the information that we have. But even with complete information, many choices we make are not the optimal decisions. Little things can change our decision-making process drastically.

I will include one example. They did a study of folks who had lined up for Duke basketball tickets. These people camped out for days for the chance to get a ticket. They were entered into a lottery - some got tickets, some did not. They obtained all of their contact information and decided to see if people valued things differently once they already had it. They tried to play ticket broker - offering to find buyers for people who got tickets and offering to find sellers for people who did not. The results were suprising to me. Those that did not get tickets were willing to pay about $175 for the tickets. Those that already had tickets were not willing to sell for less than $2400 per ticket.

Highly recommended for all readers.