Behavioral Economics and Motivations - Notes on DRIVE
I am reading Daniel H. Pink’s new book Drive: The Surprising Truth About What Motivates Us. One minor idea from this book is
· All of economics is meant to be about people's behavior.
From this point I can see a great fuse of economics, psychology, management, and other related social science, all of which are based on the human’s behaviors. This is also one highlight of this book.
This reminds me of one PBS NOVA program 'Mind over Money', which tries to illustrate an irreconcilable conflict between (traditional) rational economics and behavioral economics. I find myself difficult to accept this point, considering the only difference of the two framework, as I think, is the boundary of rationality. Their relationship is somehow similar to the connection between classical physics and quantum physics, each of which are in charge of their own empire. It proves to be exhausted to analyze the motion of a falling ball using the frameworks based on Heisenberg uncertainty principle.
As Daniel’s book indicates, the era of carrots and sticks is leaving us. It becomes less effective the techniques to design and predict our performances. Extrinsic rewards can only motivate us to pursue rewards themselves. In that sense, limited rationality is no longer a mere assumption.
Following is the Anthropology of an Idea: "Behavioral Economics", from Foreign Policy.
