Nadia Olivero ON THE SUCCESSFUL MARRIAGE BETWEEN PSYCHOLOGY

Nadia Olivero ‘ON THE SUCCESSFUL MARRIAGE BETWEEN PSYCHOLOGY AND ECONOMICS AND THEIR EXTENDED FAMILY MEMBERS OF BUSINESS AND MARKETING’ Guest Speach - Warwick University - 2 September 2019 ANSAL UNIVERSITY ENHANCEMENT PROGRAMME

TRUST YOUR HEART

1. CHILDREN (IF IT PLEASE GOD) 2. CONVERSATION OF CLEVER MEN AT CLUBS A timeless cultural tension between family and career, love and work, heart and head… 2. CONSTANT COMPANION (AND FRIEND IN OLD AGE) 3. NOT FORCED TO VISIT RELATIVES AND BEND IN EVERY TRIFLE THIS IS THE QUESTION! 3. OBJECT TO BE BELOVED AND PLAYED WITH. BETTER THAN A DOG ANYHOW 4. FREEDOM TO TRAVEL ‘If not marry Travel. Europe, yes? America? ? ’ 4. HOME & SOMEONE TO TAKE CARE OF HOUSE 5. FREEDOM TO READ AND WORK LATE AT NIGHT 5. CHARMS OF MUSIC AND FEMALE CHIT-CHAT 6. NO QUARRELLING MARRY NOT MARRY 1. FREEDOM TO GO WHERE ONE LIKED 7. MORE MONEYn- MORE MONEY FOR BOOKS 8. MORE TIME 9. BETTER WORK DONE 10. NO FATNESS AND IDLENESS 11. NO EXPENSE AND ANXIETY OF CHILDREN 12. IF MANY CHILDREN FORCED TO GAIN ONE’S BREAD (BUT THEN IT IS VERY BAD FOR ONE’S HEALTH TO WORK TOO MUCH) 13. PERHAPS MY WIFE WON’T LIKE LONDON; THEN THE SENTENCE IS BANISHMENT AND DEGRADATION INTO INDOLENT, IDLE FOOL

Emma e Charles married in november 1838 1809 -1882 Charles Darwin 1808 -1896 Emma Wedgwood 4

FOLLOW YOUR INTUITION – INTUITION MATTERS

«The research that Tversky and I conducted was guided by the idea that INTUITIVE JUDGMENTS occupy a position…between the automatic operations of perception and the deliberate operations of reasoning…we held a Two-system view, which distinguished intuition from reasoning» Kahneman’s Nobel Lecture 2002 1. BECAUSE OF LIMITED RATIONALITY, PEOPLE USE SIMPLE RULES OF THUMB (HEURISTICS) TO HELP THEM MAKE JUDGMENTS AND FORECASTS 2. THE USE OF THESE HEURISTICS LEADS TO SYSTEMATIC ERRORS (BIASES) e. g. : Status quo bias: risk aversion for gains and risk taking for losses 3. RANDOM ERRORS WOULD NOT MATTER TO ECONOMIC THEORY, BUT SYSTEMATIC ERROR IS A BIG DEAL!!

“there a bunch of things economic theory says we can leave out, and in fact, makes the strong prediction that they simply will not matter, ” “I call these ‘supposedly irrelevant factors. ’ And really my research can be summarized as there a lot of these supposedly irrelevant factors that are not irrelevant. They matter. ” Thaler Nobel lecture 2017 key findings: ‘THE CASHEW NUTS BOWL AND THE DINNER PARTY STORY: How could the guests be happy when he removed the nuts? ? . . given that a first principle of economics is more choices are always better than fewer choices? . . . 1. PEOPLE LACK OF SELF-CONTROL AND THEY NEED EXTERNAL HELP. 2. THEY ARE FARSIGHTED PLANNERS AND MYOPIC DOERS (PLANS ARE CONCERNED WITH LIFETIME UTILITY BUT THEN THEY EVALUATE OPTIONS ONLY FOR THEIR CURRENT UTILITY) 3. PEOPLE TEND TO VALUE ITEMS MORE JUST BECAUSE THEY OWN THEM (ENDOWMENT EFFECT) 4. PEOPLE ARE AFFECTED BY SOCIAL PREFERENCES – CONCERNS FOR FAIRNESS

LOOK OUTSIDE THE BOX – THINK DIFFERENT