We're all human: 'Nudge' theorist Richard Thaler wins economics Nobel

Thaler showed that economic and financial decision-makers are not always rational, but mostly deeply human

US academic Richard Thaler, who helped popularise the idea of “nudging” people towards doing what was best for them, won the 2017 Nobel Economics Prize on Monday for his work on how human nature affects supposedly rational markets.

Influential in the field of behavioural economics, his research showed how traits such as lack of self-control and fear of losing what you already have prompt decisions that may not have the best outcome in the longer term.

“I think the most important impact (of my research) is the recognition that economic agents are human and economic models have to incorporate that,” Thaler, a professor at The University of Chicago Booth School of Business, said in call broadcast at the Nobel news conference.

ALSO READ: Nobel Prize in Economics: Who is Richard Thaler?

Awarding the 9 million Swedish crown ($1.1 million) prize, the Royal Swedish Academy of Sciences said: “Richard Thaler’s contributions have built a bridge between the economic and psychological analyses of individual decision-making.” “His empirical findings and theoretical insights have been instrumental in creating the new and rapidly expanding field of behavioural economics, which has had a profound impact on many areas of economic research and policy.”

His work even earned him a glamorous foray into the movie business when he made a cameo appearance, alongside Christian Bale, Steve Carell and Ryan Gosling, in the 2015 movie “The Big Short” about the credit and housing bubble collapse that led to the 2008 global financial crisis.

“Well, I was pleased. I no longer will have to call my colleague Eugene Fama ‘Professor Fama’ on the golf course,” he joked, referring to his University of Chicago colleague who won the prize in 2013…..READ MORE