Misbehaving: The Making of Behavioral Economics

by Richard H. Thaler

The bigger lesson is that once you understand a behavioral problem, you can sometimes invent a behavioral solution to it.

The idea of self-control is paradoxical unless it is assumed that the psyche contains more than one energy system, and that these energy systems have some degree of independence from each other.”

We propose that at any point in time an individual consists of two selves. There is a forward-looking “planner” who has good intentions and cares about the future, and a devil-may-care “doer” who lives for the present.

influence the decisions that the doers make through rewards or penalties (financial or otherwise) that still allow them discretion, or she can impose rules, such as commitment strategies, which limit the doers’ options.

the planner as residing in the prefrontal cortex region of the brain, which is associated with conscious, rational thinking, whereas the doer can be associated with the limbic system.