Behavioural economists have their film stars tooComment on this story
Behavioural economists explore human errors. They focus on how people depart from perfect rationality. Many of the best movies do the same thing. They investigate how our all-too-human foibles create trouble, wealth, violence, heroism, love and war. It is past time, then, to award the Behavioural Economics Oscars, otherwise known as the Becons.
Best documentary: Behavioural economists have long been fascinated by social influences on behaviour – by the extent to which our choices are affected by the choices of other people. Why do some products succeed and others fail?
A reason is that early adopters can create a bandwagon effect. Politicians, entrepreneurs and novelists often benefit from such processes. Searching for Sugar Man is a terrific exploration of the power of social influences. Singer Sixto Rodriguez was a failure in the US but an icon in South Africa, and early word of mouth played a big role in his success here in the 1970s. For best documentary, it gets the Becon.
Best director: Psychologists and behavioural economists contend that human beings have two cognitive systems. System 1 is our automatic system. It is intuitive, rapid and effortless. System 2 is our deliberative system. It is calculative, thoughtful, reflective and slow.
Silver Linings Playbook, directed by David O Russell, is a funny and moving case study in the tension between system 1 and system 2. With his out-of-control system 1, actor Bradley Cooper is always on the verge of violent rage. His befuddled system 2 thinks that he still loves his ex-wife, and needs her. But his system 1 has fallen for the character played by Jennifer Lawrence, and she has fallen for him, too. That’s quite a silver lining. In a cakewalk, Russell gets the Becon for best director.
Best actor: Human beings tend to display unrealistic optimism. Studies have found that the vast majority of people believe that they are safer than the average driver; generally, people often think that they are less likely than others to face serious hardship. We can get into a lot of trouble if we underestimate the likelihood of a bad outcome, but optimism can be energising and increase the prospects for success.
For best actor, the Becon goes to Daniel Day-Lewis, portraying America’s melancholy optimist. As Day-Lewis shows brilliantly, Abraham Lincoln repeatedly bucked the odds. Through skill and sheer force of will, operating in concert with what his critics not unreasonably took to be unrealistic optimism, he succeeded in abolishing slavery and saving the union.
Best actress: Behavioural economists have long been interested in the limits of human attention and the power of salience. Some important aspects of products, activities and situations just aren’t salient to us, and so we ignore them, often to our detriment. In Side Effects, Rooney Mara is a brilliant manipulator of the attention of others (especially Jude Law). She won’t be eligible for an Oscar until next year, but she has our attention, and for best actress, she wins the Becon.
Best picture: A lot of social science research shows that people are both spiteful and altruistic. We will sacrifice our material self-interest to punish what we see as unfairness. At the same time, we may well give up a lot in order to help others. Bane, the punishing villain of The Dark Knight Rises, is spite incarnate, and in the end Batman is the spirit of sacrifice, and hence Bane’s worst nightmare.
Cass Sunstein, the Robert Walmsley University Professor at Harvard Law School, is a Bloomberg View columnist. He is the co-author of Nudge and author of Simpler: The Future of Government, to be published in April.