Summary: Many factors influence economic growth and development. The economic choices that individuals make are an important part of that. The field of behavioral economics has developed new ideas in helping us to understand these choices in recent decades. Today we will begin to study these ideas.
Inquiry Question: How does poverty shape individual economic choices?
You should have finished reading the article from last class and be ready for a TQE discussion.
TQE Discussion (formative): You will participate in a short small group discussion (TQE) related to the article you were assigned last class.
Lecture: I will lecture using this slide show. Video links.
Earning Money (3:37)
Spending Money (3:19)
Are the poor overwhelmed? (3:03)
Poverty and attention (3:17)
Required: None
Optional: Listen to this podcast. Focus on this question as you listen: How does poverty shape individual economic choices?
Abhijit Banerjee of MIT talks with EconTalk host Russ Roberts about Banerjee's book (co-authored with Esther Duflo), Poor Economics. The conversation begins with how randomized control trials (a particular kind of social experiment) have been used to measure the effectiveness of various types of aid to the poor. Banerjee goes on to discuss hunger, health, and education--the challenges in each area and what we have learned about what works and what does not. The conversation closes with a discussion of the role of the labor market in the private sector.