Asked by Jaiona Sessoms on Jul 07, 2024
Verified
Behavioral economics hopes to eventually fully replace the neoclassical economic model.
Neoclassical Economic Model
An economic theory that focuses on how the equilibrium state of markets is reached through supply and demand forces, emphasizing utility maximization and profit maximization.
Behavioral Economics
A field of economics that studies the effects of psychological, cognitive, emotional, cultural, and social factors on the economic decisions of individuals and institutions.
- Appreciate the behavioral economics' challenge to traditional economic models through the exploration of mental processes and biases.
Verified Answer
EP
Elizabeth PardoJul 13, 2024
Final Answer :
False
Explanation :
Behavioral economics aims to enhance and enrich the neoclassical economic model by incorporating insights from psychology and other disciplines, not to fully replace it.
Learning Objectives
- Appreciate the behavioral economics' challenge to traditional economic models through the exploration of mental processes and biases.