Chapter 2. Weekly Discussion Question

When community and business leaders make decisions they assess the impact of the decision/policy using economics. The primary underlying principle underlying economic is that people are rational, calculating, and logical. According to economics, even when people "misbehave" and don't act rationally, the market would "correct" them.Most of our social and economic policies are based on this premise.

However, that is not the real world. People aren't always rational, logical, or calculating. People tend not to be rational, logical or calculating when they are emotional, stressed, tired, time pressed, or overloaded with information. Moverover, people frequently repeat their mistakes even after being corrected.

There are three parts to this discussion:

1). Describe at time when you didn't act rationally with money.

2). Describe a situation in which you continued to repeat a behavior even after it didn't go well. (Note to tutor: this is a follow up to question 1, maybe give a different scenario, but back it up pls)

3). If our social and economic policies are based on a flawed assumption, what does the mean for the impact of the policy and society?