168 Quotes by Richard Thaler

The model of the utility of wealth gets the basic psychology of wealth right but to create a better descriptive model they recognize that we had to change our focus from levels of wealth to changes in wealth this may sound like a subtle tweak but switching the focus to changes as opposed to levels is a radical move. The focus on changes because changes or the way humans experience life.

There is no doubt that these are real people making real choices for high stakes, and we rarely get to observe such pure decisions.

There have been hundreds of papers on subjects from picking students for a school to predicting the survival of cancer patients.

At the moment no one can prove that these Internet stocks are overpriced. But many of us have deep suspicions.

The median person still thought that their prices were going to go up. That's the definition of a bubble.

Retirement savings is probably behavioral economists' greatest success story. It is a prototypical behavioral-economics problem because saving for retirement is cognitively hard - figuring out how much to save - and requires self-control.

One simple step firms can take is make sure that people that are getting paid a lot of money, say more than a million or two, that a big chunk of that money is deferred. That's going to change the whole ballgame.

The money has to be deferred with what they call "clawback," which means they can get it back if I lose it all. So that guy making ten million a year selling credit default swaps, if we're going to keep five million of it in escrow for ten years, and with the right to go back and get it, if he starts losing money, then we're going to give people the right incentives not too take so much risk.

Everyone's lost a lot of money on their 401k plans. I've heard some people calling them 201k plans. So it's even more important to get people to be saving more for retirement. Behavioral economics has helped us learn a lot about how to do that.