Richard Thaler’s Playful Disruption of Economic Tradition
Nobel laureate Richard Thaler shares insights into the human quirks shaping economics at Cornell
Richard Thaler, a Nobel laureate renowned for his groundbreaking work in behavioral economics, took the stage at Cornell’s Alice Statler Auditorium with a declaration that set the tone for the evening: “I don’t do anything that isn’t fun.”
The Profound Yet Playful Winner
Thaler, who collected the Nobel prize in 2017, humorously undercut his success by attributing it partly to fun, reminding the audience that passion and joy are equally crucial in the pursuit of intellectual endeavors.
The event on October 17th celebrated Thaler’s illustrious career that finds its roots in the unexpected scenes of real-world economics—from one-way bridges to snowy driveways. “Professor Thaler is widely considered the father of behavioral economics,” noted President Michael I. Kotlikoff, hinting at Thaler’s revolutionary approach that embraces human irrationality.
A Field Shaped by Laughter and Insights
Thaler’s narrative is not just about disrupting old theories; it’s about evolving a field that marries psychology with economics. Starting at Cornell, his ventures included creating the essential blend of humor and intellectual rigor that defined his work and helped establish a fresh path for future economists.
“Convincing traditional economists was one adventure,” Thaler joked. Instead of arguing with the established norms, he chose to “corrupt the youth,” dedicating efforts to mentor upcoming behavioral economists.
Teaching Students to Navigate Resistance
As he often does, Thaler offered practical wisdom to students: understanding those who might oppose your ideas is invaluable. “If you’re going to write a paper that people are going to hate, preempt their first three lines,” he advised, highlighting a strategic thinking approach essential for innovation in academia.
Impacting Daily Lives
Together with colleague Tom Gilovich, Thaler explored the everyday implications of behavioral economics. From tipping screens at cafes to alluring subscription offers, he showcased how nuanced human behaviors shape economic transactions.
The Road Ahead: Macro Insights
Asking about future research areas, Thaler identified macroeconomics as ripe for applying behavioral insights. Traditional models often miss important behavioral factors, and Thaler’s vision calls for incorporating those elements to broaden understanding.
Carrying the Torch Forward
Suzanne Shu, Dean of Faculty at Cornell and a former student of Thaler, summed up the evening’s sentiment: “Thanks to amazing faculty like Thaler and Gilovich, Cornell will always be known as the first home of behavioral economics.” The gathering celebrated Cornell’s historical and ongoing contributions to this vibrant field, remaining a hub for transformative ideas and nurturing the next wave of economists.
The event was a collaboration between the Cornell SC Johnson College of Business, the College of Arts and Sciences, and the Center for Behavioral Economics and Decision Research, underscoring the university’s commitment to fostering innovative paradigms in economics.