Content tagged with "behavioral-economics"
The theory of risk compensation, as outlined in Jeff Speck’s book, suggests that people adjust their behavior based on perceived risk levels, leading to less caution when there is greater risk and more caution when there is more protection. This can lead to a lower net benefit than expected from safety interventions, as seen in cases such as people being less careful with childproof medicine, people driving faster with seatbelts, and drivers following closely behind others with anti-lock brakes. The theory also applies to the shift from driving on the left to the right in Sweden in 1967, which initially led to a drop in traffic fatalities, only to return to previous levels three years later.
The article discusses the concept of “induced demand” in city planning, which suggests that if you build it, they will come. It cites a study that shows that a 10% increase in lane miles leads to an immediate 4% increase in vehicle miles traveled, which increases to 10% in a few years. The article also suggests that road congestion can actually save fuel, as the frustration of being stuck in traffic often keeps people home, suggesting that the solution to traffic and environmental problems may not be building more roads.
The author discusses the consequences of breaking rules, using the examples of Brandon Davies, Bradley Manning, and Pete Rose. They argue that while the honor code at Brigham Young University was violated, it was a clear and unambiguous line that students chose to cross, and that the consequences should be seen as clear and unambiguous. The author also draws parallels between these cases and the consequences of betting on baseball games, arguing that the validity or value of the rules is not the issue, but the fact that they existed and had clear consequences.
The Overjustification Effect explains why money can sometimes hinder motivation. Research suggests that the average income required for happiness and emotional well-being in America is $75,000 a year, and increasing income does not enhance happiness, enjoyment, sadness, or stress. It also suggests that getting paid for something can make us less enjoyable, as we start to evaluate our work in light of that compensation.