# economic perspective on individual decision making - [[value-based decision making]] # Idea Economics is typically interested in the aggregate implications of individual behavior. The [[brain as economy|brain is like a modern economy]]. It has diverse specialized units (modules) like companies in an economy. Neuroscience focuses on how the brain allocates scarce resources efficiently. Same with economics—how to allocate resources efficiently. Human beings have three characteristics: preferences, beliefs, and rationality ([[Robson 2002 evolution and human nature]]). Economics and psychology are essentially "siblings separated at birth" [[Loewenstein 2008 Neuroeconomics|(Loewenstein et al., 2008)]]. Psychology became an empirical discipline, whereas economics became a theoretical one. Unlike psychologists who see humans as fallible and self-destructive, economists embrace the [[rational choice theories]] and believe in the [[efficiency of markets]], and thus, see people as efficient maximizers of self-interest who make mistakes only when imperfectly informed about the consequences of their actions. # References - [[Loewenstein 2008 Neuroeconomics]]