Behavioral Economics: the REAL masterstroke

This post is going to be a little different; more than the typical opinion pieces, this shall be more inclined towards me letting you know how Economics as a subject is turning into that one friend of yours who does every single thing, and not necessarily be limited to just the one subject/skill he or she is educationally enlisted for.

Let’s call this person, Mayul

(For obvious reasons: P)

So basically, Mayul is an economics student and by the stereotype social sciences students are usually subjected to,

“Mayul, what exactly is your subject about? What is Economics really about”?

Naturally, Mayul has a hard time explaining it.

As much as he really enjoys what he studies in college, there are days where in he would just want to burn his books on fire for the boring and not so practically relevant models he must study to at least score well. His natural response is quite contrary to what he actually ends up doing.

Since he’s a social science student after all, he knows it’s important to know, to understand, to make sense of the past to be able to deal with the contemporary and sometimes, even the possible future.

Except, does that mean Economics as a subject is rather a totally obsolete one? I mean if it were really that practically applicable, why would there be different subjects such as Maths, Statistics and sometimes even political sciences that would be used by us Econ. Students for our theories and research?

Is Economics a subject, that rather steals for its foundations from other subjects that the experts there have ended up neglected or brushed under the rug?

Is Economics, as a subject; simply a culmination of knock offs derivative of other subjects that were (back in the day) barely institutionalized such that this heist for credit could be way too easily executed?

That makes us Econ. people, good planners.

In all honestly, I really don’t have answers to these questions; I mean c’mon, I’m a 19 y/o, year 2000 born millennial, for all I know, the widely acknowledged father of modern Economics is Paul Samuelson (1970) while the father of this entire discipline per se, is believed to be none other than Adam Smith (18^th century). I am generations and centuries late to be able to even touch the surface in answering this question.

;:::(

So why am I telling you what I am telling you?

You see, Adam Smith’s “The Wealth of Nations” (1776) has been one of those books that had it all sorted and understood right. All that we study today, the choices we make, and the “rationale” behind everything we do and choose to do, Smith had already got them covered in this one book alone.

You see that? You and I may not be able to sustain without internet today, even for an hour

You need Spotify also, so ruling out social media doesn’t count in your tolerances

But this man right here, he in an era wherein people were struggling with connecting with one another, with understanding civilizations and society and everything else you could possibly imagine, basically struggling with the human “thinking”

Adam Smith figured it all,

Whatever Garyvee says today, whatever those gurus on YouTube, Instagram and Facebook say today; Smith had figured it all.

Garyvee said “Be selfish as f*ck”, well Smith had already said “Pursuit of self interest”

Garyvee said “Don’t mull over money, pay the money to someone else whoever the f*ck does it better than you so that you can focus on what you truly want”, well Smith had already said “division of labor”

Garyvee said “you be selfish today in what you want to truly do, and you’ll naturally end up helping people”, well; Smith had already said “fulfilling self interests results in societal benefits”

And the last one being

Garyvee said “listen to your f*cking soul”, well, well, Smith had mentioned about something such as the “invisible hand”

Point being, Economics as a subject remains to be still unclear in the minds of many, even students such as me, because of the fact that more than half the things in the world, be it psychology, political sciences, philosophy, and so many more things were already covered by the first initial known writings of this subject!

In fact, all that you call marketing, the pish posh your friends would use such as “brand positioning”, “total marketability”, “target audience”, and even the term “fish market” Indian teachers are so famously known for in classes (nostalgic, I know, right?)

All these and so MANY more things, have already been covered by the subject

As a result of which, the equipment Mayul gets being a student of Economics allows him, enables him and empowers him to be the Avenger he gets to be by having an access to multiple domains, interests and skill sets;

Credits: Anirudh

but still at the end of the day, leaves him speechless each time his mother asks him the Avengers level threat question

“What is your subject exactly about”?

Why'd you have to be like that Maa?

Moving on, one thing I’ve realized as a student of social sciences, is that the world tends to questions even the future generations for the lapses committed by the previous generations (basically North Korea, but in a much more hypocritically acceptable sense)

And that is,

If people fail to clarify their stand explicitly by choosing sides in the past, their future generations would have to spend lifetimes to table and get their stands accepted and understood;

The domain of Behavioral Economics is one of those.

Since the broader subject of Economics is often misunderstood, so is the narrower spectrum of Behavioral Economics. And therefore, each time you come across an article on this subject, it always starts with a general introduction of the subject itself, regardless of the main premise of the article,

And that’s exactly, what we’re going to talk about in this article, Behavioral Economics.

Instead of quoting a source, I’ll try my tinsy winsy best to help you understand what this subject is really about;

So you remember how I mentioned about what Mayul has to study at college is (in his understanding) very obsolete in nature, given he’s often unable to apply it in the real world? Isn’t Economics perhaps the MOST robotic and non-human (relatable) subject out there?

Well, Behavioral Economics is the most suitable answer to this question of his per se.

If Mayul says today “the idea of rationality is too imaginary, I can’t not be spending money on my birthday but save it in the bank for the interest rate they’re giving me”;

Behavioral Economics is the answer since it helps him understand and incorporate the idea of “priorities” in his theory

If Mayul says today “it doesn’t make sense for me to give 1000 bucks to my friend and be happy about it while in theory I’m being irrational”

Behavioral Economics is the answer since it helps him understand his behavior in the form of “other regarding preferences” in this theory.

I could go on and on, really,

I think what I’m trying to say is, Behavioral Economics is what humanizes the otherwise perceived as an obsolete subject of economics.

And quite understandingly, it draws its foundations from the subject matters of those in psychology, business studies, marketing and sometimes, more so than often, communications.

Come to think of it, given how I’ve described things here, Economics does in fact seem like that kid who steal the credit for things you were negligent towards; except that’s not it, the kid him/herself does in fact add his/her share of value to the conceptualization of things, and therefore, let’s cut Econ. Students some slack shall we.

: P

(Sigh)

Now that we’re slightly closer towards being on the same page, let’s go through the history of this subject;

As much as the world would like to believe, “Google” would tell you, that it’s Richard Thaler who led the baton of Behavioral Economics, it really wasn’t.

It was in fact Adam Smith (yep, that guy, again).

In retrospect, man had it all covered.

His works on Behavioral Economics can be found in his another book “Theory of Moral Sentiments”

Surprisingly enough, he wrote this book in 1759, almost 2 decades prior to his first “economics” book, so there goes my pitch that stereotyped Economics as the perfect criminal for stealing credit.

Now that we’re clear about the origins, let’s dive right into what we Econ. Students love the most, the theory,

Traditional Economics views humans as robotic machined who make calculated decisions based on logic. In contrast, Behavioral economics views humans as irrational and emotional beings who are influenced by biases and experiences when making decisions. Traditional Economics is the theory; behavioral Economics is the reality.

It took a while for the Economics cohort to finally institutionalize and issue proper academic degrees based on this domain. And this is evident by the fact that not many people even within this cohort know about the subject;

I didn’t;

At least until Meghnad Desai Academy of Economics (MDAE) organised a seminar in my University. The seminar was delivered by a Dr. Shagata Mukherjee, an Indian Behavioral Economist, probably one of the pioneering ones at least in the Indian space.

Talking about pioneering, MDAE is probably one of the very few and more likely to be the only institution in India that offers a properly institutionalized, full time year long course with (intricately formulated elective) papers in Behavioral Economics. They’re so well reached and reputed around the world that the BE cohort in India has now become synonymous to MDAE.

From organizing workshops and fully fledged (just) 1 year post graduate (diploma) level programs:

1. 1 Year PGD in Economics with a specialization in Finance, Data Analytics and Public Policy

2. 1 Year PGD in Data Science and Finance

, to organizing online courses and student exposure programs,

these guys have successfully cracked it all. Established in 2014 under the mentor ship of Lord Meghnad Desai, the model institution MDAE has become over the years is something every single Indian and maybe, even foreign universities should take some pointers from.

From having a female dominant strength ratio to having an extremely robust placement cell with almost a perfect 100% placement rate for its students, MDAE stands as one of the most ideologically progressive Indian educational institutions out there.

And that’s not over-rating, you know; Mayul had attended courses and events organised by these people. Yep.

If I’m not wrong, Mayul has had the opportunity to attend the following event by MDAE in the past 2 years since he’s enrolled in college:

1. Seminar by Dr. Shagata Mukherjee at Delhi University on the topic “Behavioral Economics and its scope” (2019)

2. Class lectures by Dr. Shagata Mukherjee at Delhi University on market competitions, different market structures and optimums (2020)

3. Online course titled “Economics of Pandemics” by Dr. Abhinay Muthoo from University of Warwick, UK (2020)

4. Online course titled “the Ideas of Great Economists” by Lord Meghnad Desai, Economist and labor politician, Padma Bhushan

The experience has been phenomenal so far; the best thing about their teaching style is that they don’t necessarily refer to your boring text books written by old Brits, Scots and/or Americans; in fact, in one of the lectures by Dr. Mukherjee, we were told that they’d been following “Poor Economics” one of the very, very recent books on Behavioral economics as their referred reading.

So that’s another point for ensuring to make things relevant

These are few of the many reasons why I would recommend MDAE any one who’s looking to pursue this field.

As much as these guys focus on Behavioral Economics, the more relevant branch of the field, depending upon the course you choose, their papers revolve around the subject matters of data science, finance, python (coding), financial markets, diplomacy and even research!

As much as all these sound too good to be true, they’re in fact true.

TL;DR?

If you’re like Mayul who has a knack for everything, but an academic inclination towards Economics, more like the escape from the conventional routes of medicine and engineering sigh

Then MDAE offers you a one stop solution to everything, right from learning what’s relevant and relatable to getting you placed at a position you’d love to work in, in a company you’d love to work for!

The intention of this article was to inform you and I about this domain;

The “why” of the intention was basically an informational enlightenment?

Given how everybody’s hysterical about the economy, jobs and in fact, good jobs with good pay cheques,

MDAE is one way in to the plethora of opportunities in the field of economics and even finance;

That shall continue to exist even if the job market seems unfair and cut-throat; for the courses, the content and the placement opportunities offered in those courses.

MDAE offers are remarkable in the way they help you get the job done right!

And that was exactly the reason why I titled this article with the word “masterstroke”;

As much as it’s about Behavioral Economics, given the economic and financial climate in the country, with a dearth of jobs, people like MDAE out there are working for the betterment of us and helping us up skill while the rest of the competition is just clueless.

And also,

Because I just did my first plug ever and I’m over the moon about this, about this masterstroke.

With that beautiful first attempt kept in mind,

I leave your thinking here, and do consider joining MDAE the next academic sessions (or whenever you’re done with UG): https://www.meghnaddesaiacademy.org/

The best part is, even if you’re not from an Economics, Statistics or Mathematics, you’re still eligible to join; here are the eligibility criteria:

https://www.meghnaddesaiacademy.org/post-graduate-diploma-in-economics/

https://www.meghnaddesaiacademy.org/post-graduate-diploma-in-data-science-finance/

With that kept in perspective

This is Mayul

Signing off.

P.s Stay hydrated

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