Theories of Decision-Making in Economics and Behavioural Science

Recent years have seen important new explorations along the boundaries between economics and psychology. For the economist, the immediate question about these developments is whether they include new advances in psychology that can fruitfully be applied to economics. But the psychologist will also raise the converse question—whether there are developments in economic theory and observation that have implications for the central core of psychology. If economics is able to find verifiable and verified generalisations about human economic behaviour, then these generalisations must have a place in the more general theories of human behaviour to which psychology and sociology aspire. Influence will run both ways.2