207. Should We Really Behave Like Economists Say We Do?

One man's attempt to remake his life in the mold of homo economicus.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Stephen J. Dubner?

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• 1:28Stephen J. Dubner?

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• 1:56Stephen J. Dubner?

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• 2:35Stephen J. Dubner?

  All right, let's start with your name.

• 2:37Speaker 01

  My name's Greg Rosalsky.

• 2:38Stephen J. Dubner?

  And to people who listen to this program, especially if they get all the way to the end, to the credits, your name is a familiar name, yes?

• 2:44Speaker 01

  Maybe, I guess. But yeah, I'm a producer at Freakonomics Radio.

• 2:48Stephen J. Dubner?

  How you liking your job, by the way?

• 2:50Speaker 01

  It's great. I mean, you know.

• 2:51Stephen J. Dubner?

  Of course, I am your boss, you're not really going to say otherwise. And Greg, you are what might be called, or at least I might call you this, a real fan of economics, yes? Would you say that's accurate or no?

• 3:01Speaker 01

  Yeah, I mean, you know, on a typical Friday night, if it's going well, I'll open up a microeconomics textbook and just, no. More seriously, yeah, I'm a huge fan of economics. I studied it at grad school.

• 3:14Stephen J. Dubner?

  You read econ papers, kind of not for fun, I mean, for your job, for Freakonomics Radio, but you like it. You blog, right? You blog, a blog called Long is your blog?

• 3:21Speaker 01

  Yeah, I write about economics and.

• 3:23Stephen J. Dubner?

  I remember when the two of us were at the American Economics Association annual meetings in Boston, you looked like, you looked like my daughter at a One Direction concert, I'll be honest with you. You were, you were into it.

• 3:34Speaker 01

  Yeah, I was very into it.

• 3:39Stephen J. Dubner?

  All right, so in your studies, having studied econ and public policy at the Woodrow Wilson School at Princeton, correct?

• 3:45Speaker 01

  Yeah, that's right.

• 3:46Stephen J. Dubner?

  So in your studies of economics, you have surely come across a character that's kind of a model for how economists or economics predicts that humans behave, who's known as Homo Economicus, yes? Do you remember reading, learning about him?

• 4:00Speaker 01

  Absolutely. I mean, if you've ever taken an economics class or read. An article from a huge cross-section of academic papers. It's sort of hard not to encounter this creature. I mean, academics might not always refer to them by name, but implicitly their models usually assume that the people they're modeling are hyper rational and always work to make themselves as best off as possible.

• 4:21Stephen J. Dubner?

  And would you say that what you just described, the kind of hyper rational and working to maximize or optimize your choices and your decisions, does that describe you as a human?

• 4:31Speaker 01

  No, I don't think so, actually.

• 4:33Stephen J. Dubner?

  Would you like it to?

• 4:34Speaker 01

  I think so. I mean, like, most people, I think that, you know, my brain is, has various biases and heuristics and emotions that sort of cloud optimal decision-making. And I think I would personally be better off if I behaved that way. But I'm not quite sure that society would be better off.

• 4:54Stephen J. Dubner?

  Well, all right. Why don't we do this, then? Let's give it a try. Let's undertake a mission, which is to make you, Greg Rizalski, more, you know, better off, as you put it, by becoming more like homo economicus, to try to live your life a little bit more the way that economists would describe the way someone should live their lives. Are you up for that kind of mission?

• 5:17Speaker 01

  Definitely. It sounds like an adventure.

• 5:27Stephen J. Dubner?

  Now, you are a very bright guy, I know, but still, it would be nice, don't you think, to have some kind of personal tutor, like a Virgil, to walk you down into the depths, some kind of economics therapist, maybe, to walk you through these decisions? You like that idea or no? You want to go on your own?

• 5:45Speaker 01

  Yeah, for sure. I mean, given many academics think that nobody behaves this way, I think it would be really helpful to have some sort of advisor, or, yeah, you could call him a therapist.

• 5:56Stephen J. Dubner?

  So does any particular econo-therapist come to mind?

• 6:02Speaker 01

  Are you thinking of who I'm thinking of?

• 6:05Stephen J. Dubner?

  I think, you know what? There's a good, but, hang on, hang on. On the count of three, we'll see if you're thinking what I'm thinking. Ready? One, two, three.

• 6:16Speaker 01

  Failure.

• 6:17Stephen J. Dubner?

  Failure.

• 6:26Stephen J. Dubner?

  Thaler is Richard Thaler.

• 6:29Speaker 02

  I'm a professor of economics and behavioral science at the University of Chicago Booth School of Business.

• 6:36Stephen J. Dubner?

  But he's more than that. Thaler, 69 years old, is one of the founders of the field that has come to be known as behavioral economics, which, to be very shorthandy about it, runs Homo Economicus through a few layers of psychological understanding to see how real people actually behave. Thaler has been doing this work for many years, but his public breakthrough came a few years ago, when he co-authored a book with the legal scholar Cass Sunstein.

• 7:05Speaker 02

  We ended up calling our book and the tools we use "nudges."

• 7:11Stephen J. Dubner?

  In Thaler's view, if you want to get people to do more of what they should be doing-- save more money for retirement, or eat more nutritious food, or break some bad habit-- sometimes you have to nudge them into doing so. Because most of us don't necessarily respond to incentives as rationally as economic theory would predict. Because most of us, from the economist's perspective, misbehave. Which is the theme of Richard Thaler's new book.

• 7:38Speaker 02

  So the book is called Misbehaving: The Making of Behavioral Economics.

• 7:44Stephen J. Dubner?

  Misbehaving is Thaler's very entertaining chronicle of how he came to recognize that the standard economist's model of human behavior is beyond the reach of most of us.

• 7:55Speaker 02

  Well, the economic model of behavior really can be summarized by one word, which is optimizing.

• 8:02Stephen J. Dubner?

  And at the center of this model is the creature that our producer Greg Rosalsky hopes to become.

• 8:08Speaker 02

  This mythical creature is called Homo Economicus, and I call them "econs" for short. And, you know, none of us know any "econs." An econ can make any calculation perfectly accurately, has no self-control problems, makes accurate forecasts, he's not overconfident, has no emotions.

• 8:36Stephen J. Dubner?

  So can we take Greg, a perfectly nice and intelligent 30-year-old man, and, under the tutelage of Richard Thaler, turn him into an econ? And even if we can, would that be a good idea? That would mean sending him out into the world, interacting with all sorts of people. And let me warn you, it isn't always going to be pretty.

• 8:58Speaker 03

  I'm tired. I came from work. Go away. Nah, don't waste your time, man.

• 9:03Speaker 04

  Whoa, whoa, whoa. Okay, yeah. Some random jerk. Yeah, that will trigger my, like, free freeloader trigger.

• 9:10Speaker 03

  50 cents? No, that's not worth it. Promise to never act like this again.

• 9:26Speaker 05

  From WNYC, this is Freakonomics Radio, the podcast that explores the hidden side of everything. Here's your host, Stephen Dubner.

• 9:46Stephen J. Dubner?

  Today, I'm turning the mic over to Greg Rosalsky, a producer here at Freakonomics Radio, who is teaming up with economist Richard Thaler to try living as homo economicus, a supremely rational being. As a longtime practitioner of behavioral economics, Thaler has a kind of experience that could make him a good advisor.

• 10:06Speaker 01

  In my quest to become homo economicus, the model of human behavior still taught in Economics 101, there may be no better advisor than Richard Thaler. He's actually been described by a colleague as "the world's only clinical economist." That's sort of like being a therapist, except he uses principles from economics to improve people's lives. He's done this casually for his friends over the years, and it's sort of what he's evolved to do professionally.

• 10:30Speaker 02

  You know, you can think of Nudge as the culmination of my career as a clinical economist. Because what Cass and I tried to do in that book is help people think about organizing their lives in a more successful way and helping governments and the private sector create institutions that allow people to achieve their goals more helpfully.

• 10:57Speaker 01

  Nudge had a huge influence in public policy circles. Cass Sunstein ended up directing regulatory policy for President Obama, while Thaler advised a bunch of governments, including Britain, which set up an office nicknamed "The Nudge Unit." That office nudged citizens to do things like quit smoking, find jobs, pay their taxes on time, and conserve energy. And The Nudge Unit reportedly did all of this while saving British taxpayers tens of millions of pounds. So who better than Thaler to teach me how to become homo economicus?

• 11:26Speaker 02

  Uh, well, I'm not sure that I will teach you to become homo economicus, but, you know, go for it. Tell me what your problems are, and I'll put you on my couch. I hope you're lying down.

• 11:37Speaker 01

  I'm in a seat. It's a very comfortable seat.

• 11:40Speaker 02

  Okay, that's, that's good.

• 11:41Speaker 01

  Okay, so Professor Thaler, I have a little problem. Every morning, I commute from Brooklyn to Manhattan on the subway, and it's always so crowded that I can't get a seat. This means that I, I can't sit down, I can't enjoy my morning coffee, and I can't read the morning news. And so it's a pain in the butt. And so, thinking like an economist, I devised a little experiment. How much would I have to pay you for that seat?

• 12:10Speaker 06

  Sorry?

• 12:11Speaker 01

  How much would it cost for you to move from your seat? How much would somebody have to pay you?

• 12:15Speaker 06

  To move from my seat?

• 12:17Speaker 01

  Excuse me, can I ask you a question?

• 12:20Speaker 06

  How much would they have to pay me, what?

• 12:22Speaker 01

  Eighty dollars. Eighty dollars? That seems pretty steep.

• 12:28Speaker 01

  The people on the subway have a temporary property right to their seats because they got there first. So in my effort to become homo economicus, it seemed like the best thing to do was just pay them for their seats. I wanted to do this for as little money as possible, but sometimes, people ask for things I just couldn't give them.

• 12:45Speaker 07

  I don't know, to not feel like [BLEEP] right now. And like, not have to go to work. That's how much.

• 12:53Speaker 01

  I was hoping a quarter or two would do it.

• 12:56Speaker 02

  Well, I think you're behaving like a very good economist. But my guess is that you get very few takers.

• 13:05Speaker 01

  I don't think I would get up for you. So you wouldn't, but there would be a price, though, right? Um, if you had a hundred dollars that you're gonna give me, yeah, I'd probably do it. So if I had just, I had ten bucks, I was like, "Here." "Long day, have a comfortable seat."

• 13:20Speaker 02

  And probably a lot of dirty looks.

• 13:23Speaker 01

  Mm-hmm.

• 13:24Speaker 02

  And possibly worse.

• 13:26Speaker 07

  Well, I would definitely get up for someone who needs to sit down, like, an older person or a pregnant person. But if it's just like, some random jerk, then I'm gonna be like, "I'm gonna keep my seat. Thank you."

• 13:38Speaker 01

  One thing I learned about trying to buy seats from people is that there are a couple social norms when it comes to subway seats. The first one was that people thought I was a weirdo.

• 13:49Speaker 02

  Right.

• 13:50Speaker 01

  Because seats are not thought of as for sale.

• 13:52Speaker 02

  Because you were acting like an economist.

• 13:54Speaker 01

  How much would I have to pay you? I don't know.

• 13:59Speaker 07

  Um, it's a weird question.

• 14:03Speaker 01

  And the second social norm I encountered, which was actually one in which people said they were willing to move from their seat if I were elderly, injured, or pregnant.

• 14:12Speaker 08

  Well, it depends on who the somebody was.

• 14:14Speaker 01

  What about me?

• 14:15Speaker 08

  Limitless. There is no price.

• 14:18Speaker 01

  How about you? How much would it cost for you to move from your seat?

• 14:22Speaker 09

  How much are you willing to pay?

• 14:25Speaker 01

  Um, let's say like...

• 14:27Speaker 09

  I don't know, how much do you... Hey, let's not say. Let's just say, "What are you gonna pay me to get up?"

• 14:31Speaker 01

  How about like, uh, fifty cents?

• 14:33Speaker 09

  Fifty cents? No, that's not worth it. If you were a kind old lady, I would just get up for free.

• 14:42Speaker 01

  And so that brings up the question, how does homo economicus deal with social norms?

• 14:46Speaker 02

  Well, homo economicus doesn't much pay attention to social norms unless it's gonna hurt them financially. So, I can see homo economicus running that experiment and not having a lot of success. And, you know, a real homo economicus would bring a cane with them when they commute. Try that, you know, maybe even a fake cast.

• 15:17Speaker 01

  Okay, okay. This is really smart.

• 15:19Speaker 02

  I think that'll, uh, that'll do it for you.

• 15:21Speaker 01

  Nice.

• 15:23Speaker 02

  So, yeah, we can... I'm gonna start charging, though, for this advice.

• 15:28Speaker 01

  Yeah, you're a terrific clinical economist, I must say.

• 15:31Speaker 02

  Thank you, thank you.

• 15:33Speaker 01

  And so, would homo economicus give up his or her seat to a stranger on the subway?

• 15:40Speaker 02

  They would if the money they were offered was greater than the utility of sitting.

• 15:47Speaker 03

  You can't buy my seat. I'm tired. I came from work. Go away.

• 15:52Speaker 01

  How about you, ma'am? Um, how much would I have to pay you for your seat? If you want it really badly, you can have it for nothing.

• 16:05Speaker 01

  If I were really homo economicus, I would have taken advantage of that kind old lady. That doesn't sound very nice, does it? Which brings up the question, why in the world would I ever want to be homo economicus? Well, there are a few things that are really appealing. First off, econ's, as Professor Thaler calls them, always do something called constrained optimization, which is a fancy math term that just means they are really, really good at making themselves as happy as possible. So that means econ's always save, invest, and consume in a way they won't regret.

• 16:37Speaker 02

  They do exactly the right thing all the time. So no econ has ever had a hangover?

• 16:44Speaker 01

  Sounds nice. Economists don't have self-control problems. They always have the willpower to commit to their goals.

• 16:51Speaker 02

  If he says he's gonna go on a diet next week, he goes on a diet next week.

• 16:56Speaker 01

  And they always follow the bedrock principles of economics, like ignoring sunk costs. For example, let's say you go out to dinner at a fancy restaurant that has a prefix menu. So no matter what, you're gonna get an appetizer, main course, and dessert, all for one price. After downing the main course, you're really full. But then the dessert comes, and you tell yourself, I just have to eat that piece of cake, because I don't want to waste money.

• 17:19Speaker 02

  If you do that, then you're human, but you're misbehaving. Economic theory says the only thing that matters is how much it costs you to eat that cake, which is zero, not how much you paid for it. That's the sunk cost.

• 17:36Speaker 01

  So economists don't fall for the sunk cost fallacy, which is doing something that will make you less happy, only because you're worried about losing money. Even though that money is gone forever, it's sunk, you can't get it back. So it shouldn't affect your decisions going forward. I don't know about you, but I fall for this kind of thing all of the time. These are just a few examples of why being an econ sounds pretty appealing when it comes to how we should behave. But as Thaler says, it's not how we actually behave.

• 18:04Speaker 02

  It's basically a creature that is unrecognizable. I've never met one.

• 18:10Speaker 01

  That's even though this model of behavior, still taught to students around the world, has dominated the discipline for Thaler's entire career.

• 18:17Speaker 02

  So I started early in my career noticing ways in which people behaved that were different from the way they were supposed to behave, that they were misbehaving. Thus the title of my book. It started just with making a list of funny things people do.

• 18:39Speaker 02

  And that list has grown and has now, some 40 years later, turned into a field.

• 18:46Speaker 01

  This field, behavioral economics, sparked a huge debate, and it's one that matters for all of us. When you sign up for a new job, should your company give you a gazillion options for your retirement plan, or should it make it easy by giving you a default option? If you believe we're all econ's, we should get as many choices as possible, and the default shouldn't matter. But if you believe we're feeble humans, that we could be overwhelmed by choices, be lazy, and ignore fine print, then a good default option would be best. The default is one of many examples of Thaler's nudges. A nudge is an intervention that changes your behavior, but one which you are free to ignore if you want.

• 19:22Speaker 02

  So you can think of an example of this as handing somebody an alarm clock. If they have trouble getting up in the morning, an alarm clock is a very useful tool. But you can hit the snooze button, or turn it off.

• 19:36Speaker 01

  Thaler says that companies and governments should make more use of policies that function like alarm clocks. And he and his colleagues have worked to do just that. They've also inspired the invention of new technologies. Here's an exercise idea proposed on a previous Freakonomics Radio episode by Professor Catherine Milkman of the University of Pennsylvania.

• 19:54Speaker 10

  So imagine that you took a company like Netflix and you called it Gymflix, and you let people set aside certain TV shows for gym-only access. My research suggests that a product like that might be very attractive to people.

• 20:07Speaker 01

  If we were all econ's, something like Gymflix wouldn't motivate us to work out more. But Milkman has evidence that it does. Yet the debate continues. One of the most contentious ones is about financial markets. Models that assume that we all behave as rational econ's say there won't be problems like stock market or housing bubbles. Thaler calls this prediction "the price is right," like the game show.

• 20:32Speaker 01

  Those who believe the price is right, and always right, reject evidence from the lab. They argue that, in the real world, competitive markets force investors to be rational. After all, they say, investors will lose tons of money if they aren't. Behavioral economists like Thaler disagree. They argue that prices, such as the valuations of companies, are often wrong, sometimes very wrong. They believe bubbles exist because we make systematic mistakes, that we misbehave. This view has gained popularity in recent years, but there are still strong defenders of the traditional model, which is sometimes known as rational choice.

• 21:09Speaker 01

  So, the devil's advocate, and this is probably a lot of your colleagues at the University of Chicago, probably less than there were when you were first starting off, but they say, okay, sure, human beings don't behave exactly as the rational choice model predicts. But within competitive markets, where there are high stakes and simple rules to follow, these models have been tremendously powerful when making predictions, at least on average. And so, what do you say to those types of arguments?

• 21:36Speaker 02

  Well, I would say two things. One, in the book, I coin a possibly obnoxious phrase called "the invisible hand wave." And you were basically using the invisible hand wave in the question you asked me. So, you know, the idea that somehow people will misbehave in the lab, but then when they get out in the real world, they behave just like an econ, you know, did people live through the last eight years, when we had a housing bubble and people were giving mortgages

• 22:16Speaker 02

  to people who can't afford them, and people were taking out those mortgages, and then getting in trouble when house prices fell? The notion that somehow markets are gonna force people to be rational is just silly.

• 22:31Speaker 01

  But Thaler doesn't think it's silly for us to aim at becoming econ's.

• 22:35Speaker 02

  You know, it would be great if we all had a spreadsheet that was running constantly in our brain. And making calculations. And I think we would be better off having expectations that lined up with reality. I think we would be better off if we didn't have a third of the population that was obese. So I think most of the time, it would be better if we were all econ.

• 23:04Speaker 01

  Thaler has a big exception to this, which you'll hear in a bit. But one area he thinks we'd be better off acting like this creature is when we make decisions under uncertainty, like how we should make investments or pick a job. In the real world, we don't always do this right. We do quirky things, like valuing what we hold more when it's taken away from us than when it's given to us, and miscalculating the odds of events or the value of investments because of how many times we hear about them on the news. Thaler says we'd be better off following the rational model of making decisions when there's uncertainty. It's called expected utility theory.

• 23:38Speaker 02

  Well, the theory is really quite simple, at least in principle. If you are considering some risky option, look at the probabilities, compute the utilities, and calculate and pick the best thing.

• 23:54Speaker 01

  So Professor Thaler, relationships are big investments.

• 23:58Speaker 02

  Yeah.

• 23:59Speaker 01

  Yeah. And I've been dating this girl for a few weeks now, and I'm thinking about using expected utility theory in order to decide whether or not to ask her to be my girlfriend. How would an econ go about making this decision?

• 24:13Speaker 02

  Well, now, the first thing you would have to do is, econ's always think about opportunity costs. So you have to compare this girlfriend to all the possible other girlfriends. Now, you do have training in economics, right?

• 24:32Speaker 01

  Yeah, I do.

• 24:33Speaker 02

  So that may be a limited set, because, right? This has to be a girlfriend that presumably wants to reciprocate this relationship. So there's a set of possible girlfriends, not all of whom you know. Economists have written down models about how you should search in a situation like this. So, you know, you've had other girlfriends in the past, and either you or they have rejected you, so...

• 25:06Speaker 02

  The question of whether this is the right one depends on how likely it is you'd find somebody better. That's the first thing an economist would do.

• 25:16Speaker 01

  Right, and there's also other probabilities, right? I mean, you know, someday I want to get married, someday I want to have kids, and you know, so that sort of, that upfront investment in her being my girlfriend, you know, I kind of have to have some sort of knowledge of the probabilities that, you know, I'm making the right investment here.

• 25:36Speaker 02

  Right, and presumably if you decide that this is your girlfriend and behave responsibly, then you're going to be missing out on all kinds of opportunities for searching for better alternatives. And that'll be another opportunity cost that

• 25:53Speaker 01

  Right, single life.

• 25:54Speaker 02

  Homo economicus will be considering every day. Each day will be another decision about whether to stick with this girlfriend or resume searching. I recommend strongly not playing this particular part of the interview to this prospective girlfriend.

• 26:12Speaker 01

  Yeah, I might, yeah, I might have to do some, related question, actually. Can homo economicus be romantic?

• 26:19Speaker 02

  I don't really think so. Um, I, no, I don't, I don't think so.

• 26:29Speaker 01

  But to be serious for a second, this girl is really great. Um, but, and, but to use it, um, she's, she's, she's really terrific, and, and I, I have a big crush on her. Um, but, again, trying to live my life as homo economicus, um, so here's my plan. Uh, I'm gonna create a spreadsheet and figure out the costs, benefits, and probabilities of this decision with her, and then take the plunge. Does that sound like a good idea?

• 26:54Speaker 02

  Um, well, it would sound like a good idea if you wanted to make a decision as homo economicus, um, better include how much money she's gonna make.

• 27:10Speaker 01

  This doesn't sound very romantic, does it? But I really like this girl. So, thinking like homo economicus, I thought about how I could maximize the chances that she'd become my girlfriend. That is, of course, in the case that my spreadsheet ended up saying she was an optimal choice. The date I picked was Valentine's Day. The place? The most romantic spot in New York City I could think of. How about the top of the Empire State Building?

• 27:33Speaker 11

  Oh, yes, that's perfect. It's the nearest thing to heaven we have in New York.

• 27:39Speaker 12

  The Empire State Building Observatory is our New York City's highest and feature unobstructed 360-degree views.

• 27:47Speaker 03

  You can walk up, six flights. You can walk up this hallway here.

• 27:51Speaker 01

  There's nothing more romantic than walking upstairs.

• 27:54Speaker 03

  With a crowd of people.

• 27:55Speaker 01

  With a crowd of people.

• 27:55Speaker 03

  It's a movie, they just pop right on up. There's no line, there's no ticket. They just go up and they meet each other there.

• 28:03Speaker 01

  We made it.

• 28:07Speaker 01

  We're at the observation deck now, we're inside. It is snowing outside right now. Alright, let's bundle up before we go out there.

• 28:20Speaker 01

  Whoa.

• 28:22Speaker 03

  It's snowing pretty hard. You can barely see, uh, past about 20 blocks or so.

• 28:30Speaker 01

  So what can you see right now?

• 28:32Speaker 03

  Let's see. Oh, I see the Chrysler Building.

• 28:37Speaker 01

  Well, uh, I guess this is a good moment, uh, so... Hey, Rachel.

• 28:42Speaker 03

  Hey, Greg.

• 28:43Speaker 01

  Um, well, I asked you to come up here on Valentine's Day because I have a question to ask.

• 28:48Speaker 03

  Alright.

• 28:50Speaker 01

  But before I ask it, hold on one second.

• 28:54Speaker 03

  Oh, is this a, is this an iPad for me?

• 28:58Speaker 01

  No, actually, I just have to fill out this spreadsheet real quickly.

• 29:01Speaker 03

  Okay.

• 29:02Speaker 01

  Alright, here we go. Um, so, before I ask the big question, I have a few smaller questions to ask, okay? Um, as you know, I've been living my life as homo economicus and before you'd make a decision like this, you would weigh out all the costs, benefits, and probabilities. If you think about it, this is really an investment and I just want to make sure we're making the right decision here. So, uh, okay, here we go.

• 29:25Speaker 01

  What is the probability that you'll want to get married within the next five years?

• 29:31Speaker 03

  Um, do I say like on a spectrum?

• 29:37Speaker 03

  Um, medium to high?

• 29:40Speaker 01

  Okay, great. That's good. That's good. Okay, here's another question. What's the probability that you want to have children within the next?

• 29:47Speaker 03

  Oh my god, the next 10 years?

• 29:50Speaker 01

  Yeah.

• 29:51Speaker 03

  Um, high?

• 29:53Speaker 01

  Okay, great. That's awesome. So, all right, so just a few more little things. Also, there's costs and benefits involved in this decision. So, I mean, we live about half an hour away from each other on the train, which is, that's kind of a pain in the butt, right? I mean?

• 30:07Speaker 03

  Yeah, that's true.

• 30:08Speaker 01

  And also, you're a vegan, so that kind of...

• 30:11Speaker 03

  Whoa, whoa, whoa, okay, yeah.

• 30:13Speaker 01

  So that kind of, you know, limits our... Happy Valentine's Day.

• 30:21Speaker 01

  Okay, well, so, yeah, so that limits our restaurant options a little bit, you being a vegan.

• 30:26Speaker 03

  That could be a benefit to your health.

• 30:28Speaker 01

  Okay, that's true. But it does limit our options. But you know what? You're right. Maybe I'll switch to being a vegan too. And then, I mean, there's the opportunity cost of us being single, but you know what? I mean, that's overrated. But on the other hand, there's just tremendous benefits as I see it. I mean, you're just, you're so smart, and you're beautiful, and you're funny, and I have such a great time with you, and I've thought about it, I've weighed everything, and I'm wondering if you'd want to be my girlfriend.

• 30:59Speaker 03

  Yes, um, I mean, as long as you promise to never act like this again.

• 31:05Speaker 01

  Yeah, I could agree to that. I could agree to that.

• 31:19Stephen J. Dubner?

  All right, so Greg, it's been a few months since you and Rachel officially became a couple up on the Empire State Building. How are things going on that front? Are you still together?

• 31:27Speaker 01

  Well, believe it or not, Stephen, I'm happy to report, yes, we're still together.

• 31:31Stephen J. Dubner?

  And do you think that's because of or despite the romantic spreadsheet you whipped out that night?

• 31:38Speaker 01

  You know, I'm really happy with the relationship, so I guess you could say I made the optimal decision. But I can't really say if that's because of the cost benefit analysis I did with my spreadsheet, so...

• 31:49Stephen J. Dubner?

  Okay.

• 31:49Speaker 01

  But maybe.

• 31:50Stephen J. Dubner?

  So I'm curious, have you found that having a girlfriend now has affected your pursuit to be more like homo economicus? I guess I'm thinking about this in at least two directions. You know, one, you might see yourself now as half of a couple with a different future trajectory than if you were purely single. And then, two, there's the opportunity cost angle. You aren't having to spend a lot of time pursuing a girlfriend. So how is that working out generally?

• 32:19Speaker 01

  Well, Stephen, to put it in economic terms, I think there are a lot of complementarities between me and Rachel. We like hanging out. We like doing things together. And I think we're happier together than we would be apart. So I think, and I think that's even truer since Valentine's Day.

• 32:35Stephen J. Dubner?

  Okay, Greg, I want you to tell us what we are going to hear from you in Act Two as you continue to live your life a bit more like homo economicus.

• 32:44Speaker 01

  If you haven't already guessed, Stephen, this creature doesn't quite fit in the world that we live in. And a big part of that comes from what Thaler said at the top. An econ has no emotions.

• 32:57Speaker 01

  As you'll hear from Thaler, this has some big downsides for society. Humans are a lot nicer than econ. But as a different economist tells me, there might be a real upside to going through life thinking like an econ without all that emotion.

• 33:10Speaker 13

  He doesn't have hate. He doesn't have envy. So think about terrorism. In a world where everyone is homo economicus, who would the terrorists be?

• 33:32Stephen J. Dubner?

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• 34:17Stephen J. Dubner?

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• 34:35Stephen J. Dubner?

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• 35:23Stephen J. Dubner?

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• 35:57Speaker 05

  From WNYC, this is Freakonomics Radio. Here's your host, Stephen Dubner.

• 36:09Stephen J. Dubner?

  Greg Rosalsky, a producer on this show, is trying to live his life more like Homo Economicus, the economist's idealized version of the human being. So far, he has gotten advice on how he could improve his morning commute, and he's had some success on the finding a girlfriend front, although we don't really know the counterfactual, whether he might have been just as successful, even more so, without the spreadsheet. Now, it is time to think about how a guy like him, a would-be econ, fits more broadly into society and what he can and should be contributing to society. He starts small with a musician playing in a subway station in Greenwich Village.

• 36:50Speaker 01

  Excuse me.

• 36:51Speaker 04

  Yes, hi.

• 36:53Speaker 01

  Can I ask you a question? How many people walk by and enjoy you playing the viola and do not give you money?

• 37:01Speaker 04

  How many people give me money? It's definitely a small percentage of the people who walk by. There are probably thousands of people who walk by even in an hour. And yet, I also have made my living at it for months this way. So...

• 37:14Speaker 01

  Let's say I'm completely cynical or I'm a sociopath. And I just sit here and I listen to you play this beautiful music, and I don't pay. What do you think then?

• 37:26Speaker 04

  I admit, I get kind of annoyed if someone sits directly in front of me, listens to multiple movements. I give my especial best because they're there, and then they don't pay anything. Yeah, that will trigger my freeloader trigger. Yeah, I don't like that.

• 37:41Speaker 01

  And so when people do give you... Because in economics, this is what is known as a public good, where I can get access to it without paying for it. So there's an incentive problem there. And so when people do give you money for something they don't have to pay for, why do you think they do it?

• 38:00Speaker 04

  Well, I like to think it's out of love. But there probably are a lot of different reasons, including pity and compassion or guilt. I don't know. I think there are a lot of reasons why people give. But I like to think the main reason is inspiration.

• 38:15Speaker 01

  And what's your name?

• 38:17Speaker 04

  Allison.

• 38:18Speaker 01

  Allison, thank you so much.

• 38:32Speaker 01

  Our world is filled with public goods. Clean air, roads, the rule of law, fireworks. The list goes on and on. Public goods have a specific definition in economics. The most important part is that they are non-excludable. That is, public goods are really hard to exclude others from consuming. So in the case of Alison's music, which was played in a public space, there was no real way to prevent me from listening to it. That's nice, because it means I can enjoy her music for free. But there's a problem. If everyone thought that way, street musicians wouldn't get any money, and a lot of them might decide to stop. This is known as the free rider problem, and it's why economists believe free markets cannot always provide public goods.

• 39:17Speaker 01

  I asked Professor Théodore about this. So standard economic theory predicts that public goods will not be provided at the optimal level because of what's called the free rider problem. Basically, many people will not contribute to something they can get for free. So is it safe to say that homo economicus is a free rider?

• 39:34Speaker 02

  Yes, and proud of it. Econs think that it's a fool's game to contribute to charity or donate to public radio.

• 39:45Speaker 01

  Boo.

• 39:45Speaker 02

  Right, because why should I donate? Because I can listen for free.

• 39:59Speaker 01

  The decision to give money to a street musician is similar to many other decisions. Should you clean up the common space of your shared apartment? Should you support the accuracy of Yelp by uploading reviews yourself? Should you give money to that charity that helps starving children? And when it comes to our government, should you contribute to the public good that is a well-functioning democracy by, say, voting?

• 40:21Speaker 01

  We are in WNYC on Election Day, November 4th, 2014. You gonna vote today? That's our executive producer, Susie Lechtenberg. I'm not quite sure, because I'm thinking about what homo economicus would do, and I don't think he would vote. To be sure, I called up the economist Brian Kaplan, a professor at George Mason University and author of "The Myth of the Rational Voter." Hello, Professor Kaplan?

• 40:47Speaker 13

  Hello.

• 40:48Speaker 01

  I explained to Professor Kaplan that I was attempting to live my life as homo economicus. The classic version of this creature is completely selfish. So I asked Kaplan, if I were really the selfish homo economicus, would I vote or not?

• 41:00Speaker 13

  If you're totally selfish, the odds that your vote is going to change the outcome of an election is so slim that you simply would not bother to vote. Even if you're voting on your own execution, you're more likely to die on the way to the polls than you are to get executed. So you might as well just take your chances and sit it out and stay home.

• 41:17Speaker 01

  But maybe there are some reasons why the super selfish homo economicus would want to vote, like, say, signaling to his friends and his colleagues. So say I want to get that nice "I voted" sticker and put it on my shirt and then show it to my friends and say, "Hey, look at me."

• 41:32Speaker 13

  Yeah, as long as they didn't realize what was going on. So yeah, if you're all homo economicus, then there'd be very little point. But if you were trying to pass... So I'm homo economicus, but all my friends would get very upset at me if I don't vote. So what do I do? Well, I could either take two hours out of my life and vote, or I could go online and print out some stickers, which will take care of my voting requirements for the next 20 years. Every time there's an election, I pull a sticker off the sheet and my friends are none the wiser.

• 41:58Speaker 01

  It was already Election Day, and I didn't have access to counterfeit "I voted" stickers. So that wasn't really an option for me in character as homo economicus. Furthermore, I had a bunch of non-homo economicus friends and colleagues who did vote and urged me to do so too. One of them was my friend Sean, who works at a Destiny Mine. He immigrated to this country, and he actually put in the work to become a naturalized citizen. He cares about our democracy.

• 42:23Speaker 14

  My name's Sean Ramisfer. I'm the host of a podcast called Sideshow from Studio 360.

• 42:28Speaker 01

  I explained my situation to Sean. I saw that you have a little sticker on your sweatshirt, and I'm wondering, why did you vote?

• 42:37Speaker 14

  Um... I voted because I consider it a privilege to vote.

• 42:43Speaker 01

  That's... why so? What... I mean, you're from Canada, so I mean, are you guys not allowed to vote up there? Or why is it a privilege?

• 42:49Speaker 14

  Well, Canadians are allowed to vote. I moved to the United States when I was 16 years old. And by the time I turned 18 and would have been a legal voter in Canada, I was no longer vested in Canadian politics. And I became a naturalized citizen of the United States in 2011 at the age of 26. And that was the first time I could really vote. That was the first time I voted. It's always been a passion of mine. Politics, I find politics to be a little disheartening at times.

• 43:24Speaker 01

  It's a nice word.

• 43:25Speaker 14

  But to be so apathetic that I wouldn't vote seems like not to be the correct course of action. I don't think it'd be helping the situation.

• 43:36Speaker 01

  So what's your advice for me?

• 43:38Speaker 14

  Can we get personal?

• 43:39Speaker 01

  Yeah, let's get personal.

• 43:40Speaker 14

  Okay, Greg, I know where you live. And you live in Williamsburg, perhaps one of the hippest neighborhoods in Brooklyn. This morning, I went to our local polling station in Williamsburg. And there were three people in there. It was really sad. We have become cliches. We're just non-voting, apathetic hipsters. Counter that narrative, Greg. Get out there and vote.

• 44:06Speaker 01

  For the record, I'm not a hipster. But maybe Sean had a point. If I was really homo economicus, maybe this peer pressure wouldn't affect me much. But Sean's words were enough to at least motivate me to go to my local polling station. After all, it was only one block from my apartment. So I'm now in Williamsburg, Brooklyn, outside of a polling station,

• 44:27Speaker 01

  trying to find a rational reason for me to go in there and vote as homo economicus. Hey, how's it going? Can I talk to you guys for a second? Did you guys vote today?

• 44:41Speaker 09

  Nah.

• 44:41Speaker 01

  Why didn't you vote?

• 44:44Speaker 01

  Our vote doesn't count anyway, so I believe it counts, so I don't vote. So economists agree with you.

• 44:52Speaker 01

  What's in it for me? What's in voting for me?

• 44:55Speaker 15

  You get a sticker.

• 44:56Speaker 01

  That's it, I guess. Right? And then you could show it off.

• 44:59Speaker 15

  Yeah.

• 44:59Speaker 01

  So if you're really selfish, like me.

• 45:00Speaker 15

  You can show up all your friends on Facebook. Instagram.

• 45:04Speaker 01

  Instagram. A lot of likes. I'm not sure how much Facebook or Instagram likes are worth, but it's hard for me to believe democracy runs on them. Which brings up the question, how do economists who subscribe to this view of human behavior think democracy works? Kaplan again.

• 45:20Speaker 13

  It's a good question. So in a way, you would have to ask them. But I mean, there is a standard answer, which is, well, once enough people drop out, the probability that you change the outcome will finally get to be appreciable, and then people will finally vote. So the prediction in the world of homo economicus is not that nobody would vote, but that voter turnout would get to be so low that it actually started to pay.

• 45:40Speaker 01

  So basically, in most circumstances, the neoclassical economic model says we shouldn't vote. Of course, not everyone feels that way.

• 45:47Speaker 14

  As an American, you have a duty to vote.

• 45:50Speaker 01

  That's not enough to sway homo economicus.

• 45:52Speaker 06

  Why did I vote? Because each vote counts. As a citizen, it's our responsibility. You know, our community needs a lot of things like, you know, better school, better teachers.

• 46:06Speaker 01

  I don't have kids, and I'm not sure I would raise them here. So if I were really selfish, I wouldn't care about the quality of my community schools. And even if I weren't in character as homo economicus, my one vote wouldn't matter anyway.

• 46:19Speaker 16

  It's not just a simple matter of vote and walk away, but we have to vote. They win, we make sure we hold them to it. So one of the ways in which we do that is to join our civic association, block associations, get together in groups.

• 46:34Speaker 01

  So there's power in organizing.

• 46:36Speaker 16

  There is power in organizing this thing, and that's the only way we can get them to adhere to what they say, to do what they say they are going to do.

• 46:44Speaker 01

  So we know that homo economicus wouldn't vote in most circumstances. What about organize?

• 46:48Speaker 13

  Well, the leader role is kind of nice, because you might be able to get a lot of attention for yourself and turn it into a successful career. The real question is, would homo economicus ever want to be a rank-and-file follower? And that's a definite no.

• 47:02Speaker 01

  In 1965, economist Manfred Olson published an influential book called The Logic of Collective Action, which applied the homo economicus model to the political world. He argues that political action is a public good, like the street music we heard before. That's because people who don't contribute to organized political causes can't be excluded from their benefits, just like we can't be prevented from listening to music in a public space. Hence, there's a huge free rider problem for collective action. Now, back to homo economicus. He's extremely selfish. He has no emotions. He does a cost-benefit analysis of everything. He's the type of creature who, as Richard Thaler says, "If he encountered one of those 'give a penny, take a penny' trays at a convenience store, uh, they would take all the pennies."

• 47:46Speaker 01

  If collective action is a public good, what does that mean?

• 47:49Speaker 13

  The answer is if everyone were homo economicus, then collective action would never happen.

• 47:54Speaker 01

  You might be thinking, "We live in a democracy. Large groups of people work together for the greater good all the time." The late Manfred Olson would disagree. Here he is explaining his theory to the US Congress in 1995.

• 48:05Speaker 08

  Let's think first of a lobbying organization that we might think of setting up just to serve the public interest, or to serve the interest of consumers, or taxpayers, or the poor, or any other large class. Well, if we had such a lobbying organization, the benefits of it would go to a huge number of people, whether or not they paid dues.

• 48:29Speaker 01

  And because people cannot be excluded from the benefits, even if they don't chip in, these incentives create a destructive free rider problem.

• 48:37Speaker 08

  So that means that we lack organizations that lobby for the public interest in general, such as we have, are tiny and relatively unimportant.

• 48:46Speaker 01

  But Olson argued that smaller groups, like big corporations and unions, could lobby effectively.

• 48:52Speaker 08

  The free rider problem is less serious for them because one or two or three organizations get a large part of the benefit.

• 49:00Speaker 01

  As a result, Olson believed he had the answer to why, in a democracy, special interest groups trump the public interest again and again. But what about those political causes that did actually benefit large groups of people? These stories fill history books. Movements that ended slavery and apartheid, fought communism and fascism, preserved freedom, and won independence. How do people who believe we all act like homo economicus explain these big changes? Kaplan again.

• 49:27Speaker 13

  Yeah, that's a great question. So my late colleague Gordon Tullock had a paper called "The Paradox of Revolution." He was as firm a believer in homo economicus as anyone I have ever met. And he really had two stories. So story number one is that almost all the history you've heard is wrong. And really, what are painted by historians as mass movements are mainly struggles between rival elites, who then write the history books to claim the people are on their side. And then Tullock's other story is there's also an entertainment element. So Tullock was around during the student revolt of the 60s, and he saw them with his own eyes. And he said, "Look, these kids, they know it's very unlikely that they're actually going to get shot. There's not going to be a lot of violence. So what are they doing? They're having a little party, or a big party. They're going, and they're dancing around, and they're cheering, and they're smoking some pot.

• 50:11Speaker 13

  And if the police actually start doing what happens in scarier countries, they will run away like frightened rabbits, or would have."

• 50:26Speaker 01

  Tullock's theory shows how, if you believe we're all completely selfish, it's possible to concoct explanations for the big changes we've seen in history. But there's a problem with that theory. There's a mountain of evidence that says we're not completely selfish. How could so many economists lose sight of that? Richard Thaler again.

• 50:44Speaker 02

  How Mr. Econ came to dominate the profession, it was not always that way. I mean, Adam Smith was a behavioral economist. And economists, up until World War II, had no trouble realizing that they were trying to talk about real people.

• 51:04Speaker 01

  Charity, volunteering, public service, street music? Real people contribute to things all the time for nothing having to do with financial or social gain. That's what a huge volume of research tells us.

• 51:17Speaker 02

  What we know is, thankfully, some people do contribute. So the real world is a mixture. There are free riders and there are cooperators.

• 51:28Speaker 01

  If the extreme version of the homo economicus model were the truth, we would all be free riders. Everything that requires an ounce of compassion, or pity, or love would shrivel up and die. We would all follow the logic. Why should I give to something when I can get it for free?

• 51:45Speaker 02

  The great economist and philosopher Amartya Sen wrote an article describing people who think like that as rational fools. Because they know the theory, but they're fools because they should realize that if everyone in society behaved that way, the world would not be a very happy place.

• 52:08Speaker 01

  So there are huge downsides to living on planet homo economicus. But Kaplan points to the potential upsides. People often focus on the good emotions that homo economicus doesn't have. So he doesn't have love and compassion, that kind of thing. But they tend to forget the other things he doesn't have. He doesn't have hate, he doesn't have envy. So think about terrorism. In a world where everyone is homo economicus, who would the terrorists be? Who are going to be, people are going to say, I'm going to go kill myself. What? Kill myself? How am I going to enjoy the world that our terrorism is going to create for us if I'm dead? I'm not doing it. Just think about what war would be like if every guy on every side is like, all right, well, I'm only going to do this. It's a very tiny risk. So homo economicus could, and terrorism, give us world peace.

• 52:54Speaker 01

  For better or for worse, we don't live in a world of homo economicus. We live in a world of homo sapiens, where some people contribute to public goods, some do public bads, and some people do nothing. Some are free riders and others cooperators.

• 53:09Speaker 02

  And neither extreme model is a good description of the way people actually behave.

• 53:15Speaker 01

  Professor Richard Thaler has spent his career urging his fellow economists to recognize just that, how people actually behave. And if economics is supposed to be a science, not a dogma, its models must take that into account. The neoclassical model that we poked fun of on this program is still taught in Economics 101. But rational choice models have undergone major revisions in recent decades. Behavioral economists have played a big part in that. For example, in what could be called homo economicus 2.0, many economists have dropped the classic assumption that everyone is completely selfish.

• 53:47Speaker 02

  Yeah, and I think most economists would agree that the second one is closer to the truth. But I think it depends on where you want to draw the line. So I think no economist would deny that people behave altruistically toward their family members and close friends. And you can make an argument about reciprocity, that this is all rational. But it's clear that people are, show more other-regarding behavior than even that expansive definition would suggest.

• 54:26Speaker 02

  And the phrase that I like to use for this is, people are conditional cooperators. So you don't want to be the only one that puts some money into the guitar case for the street musician, but if other people are, then they will too. And that's why any smart street musician starts by putting some money in the case before they start playing.

• 54:58Speaker 01

  And just as some people are conditional cooperators when they give money to a street musician, conditional cooperation can explain why many people volunteer for causes for the greater good, or depending on your perspective and place, the greater bad. As for Homo Economicus 2.0, according to Kaplan, this non-selfish version can explain why we would rationally vote in some cases.

• 55:18Speaker 13

  Right, right. So Homo Economicus 2.0 might vote if the stars align. So what do you need to have the stars align? Well, you need the candidates to actually be really different from each other. Homo Economicus has to figure out which one is actually better. A whole lot of people have to be affected, and the election has to be close. Put that all together, and Homo Economicus probably would vote.

• 55:43Speaker 01

  So Homo Economicus 2.0 is an improvement, bringing us closer to explaining how the real world works. And that's important, because economic models help us think through problems and come up with solutions. But even Homo Economicus 2.0 is galaxies away from Homo sapiens. In fact, Thaler still thinks of him like a half-alien from the planet Vulcan.

• 56:05Speaker 02

  Mr. Spock on Star Trek. Logical. Flawlessly logical. He was an economist. And if you remember, he found humans quite amusing. You'd make a splendid computer, Mr. Spock. That is very kind of you, Captain.

• 56:22Speaker 01

  Homo Economicus is not human, because he doesn't have a brain. He has a utility function, a simple formula for obtaining his needs and wants. And this utility function comes complete, with superpowers, like constrained optimization, a power that makes him ridiculously good and making himself the happiest he can be.

• 56:42Speaker 01

  Why would economists cling to assumptions like this? Thaler thinks it comes down to how hard the math becomes without it.

• 56:48Speaker 02

  It's very much the case that neoclassical economics and the concept of Homo Economicus has evolved in part because of the limited rationality of economists. And by that I mean, constrained optimization problems are the easiest ones to solve. Trying to solve problems where people behave differently depending on what mood they're in and if the probabilities they assign to various outcomes aren't the correct ones, it's very hard to do in a mathematical way. Now, we're making a lot of progress on that.

• 57:38Speaker 01

  Once a voice in the wilderness, Thaler is now the president of the American Economic Association, the main professional organization for US economists.

• 57:47Speaker 02

  As for the profession, I'm pretty optimistic. The younger crowd seems open-minded.

• 57:55Speaker 01

  Thaler says those becoming economists, at least at the graduate school level, are being taught ideas from behavioral economics and that behavioral insights are becoming more widely accepted by his profession.

• 58:05Speaker 02

  The most cantankerous objectors are the ones closer to my age.

• 58:11Speaker 01

  And whether or not it's rational for him to be, Thaler is optimistic about the future.

• 58:16Speaker 02

  I hope that 50 years from now, maybe sooner, the field of behavioral economics will no longer exist and economics will just be as behavioral as it needs to be.

• 58:38Stephen J. Dubner?

  That was Greg Rosalsky, a producer here at Freakonomics Radio. Next week on the show, there are certain crimes for which the criminal pays and pays and pays.

• 58:48Speaker 17

  I'm guessing the first year that an individual is charged and convicted, they're going to be easily in the $10,000 range.

• 58:59Stephen J. Dubner?

  Why is it so costly to be a sex offender? That's next time on Freakonomics Radio.

• 59:08Speaker 05

  Freakonomics Radio is produced by WNYC and Dubner Productions. Our staff includes Greg Rosalsky, Caroline English, Susie Lechtenberg, Merritt Jacob, and Christopher Wirth. We had help this week from David Herman, Daniel DeZula, and Wayne Schulmeister. If you want more Freakonomics Radio, you can subscribe to our podcast on iTunes or go to Freakonomics.com, where you'll find lots of radio, a blog, the books, and more.

• 59:43Stephen J. Dubner?

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• 1:00:14Stephen J. Dubner?

  Freakonomics Radio is sponsored by Southern Company. The world and its energy needs are always changing. Southern Company's commitment to meeting this demand stays the same. That's because Southern Company believes energy is more than a utility. It's what powers possibilities. So they are looking ahead and investing $80 billion in infrastructure upgrades and are committed to fueling growth in ways that benefit all customers so that reliable and affordable energy is accessible for generations to come. Go to southerncompany.com to learn more. Southern Company, building the future of energy.

• 1:00:51Speaker 18

  Hey, it's Kelly Ripa. And if you don't know, I have a podcast where I get to say whatever I want. Hold on, let me get a shovel and a body bag. I envision doing a podcast with the conversations that happen in my dressing room, off camera, where people feel free to talk. No hair, no makeup. This is my kind of job. Only Kelly Ripa can ask me these questions. I'm flipping the script and saying what's really on my mind.

• 1:01:15Speaker 12

  We're seeing a different side of you. It's a little bit more honest.

• 1:01:19Speaker 18

  When the cameras go off, the real fun begins. Get my hair done over here. Hey. This is an off-camera podcast, so it doesn't even matter. It's unfiltered conversations and unexpected confessions.

• 1:01:30Speaker 19

  My mom says, Woody, I knew your dad.

• 1:01:34Speaker 18

  Stop the press. I would like to volunteer to administer any and all DNA tests. Maybe that should be part of the show. Let's talk off-camera with me, Kelly Ripa. You just put that in my universe. Listen and follow wherever you get your podcasts.

• 1:01:51Speaker 12

  This episode is brought to you by Charles Schwab. Is there a right time to sell a stock? Are you taking the right risks with your portfolio? Financial decisions can be tricky, and often your own cognitive and emotional biases can lead you astray. Financial Decoder, an original podcast from Charles Schwab, can help. Join host Mark Reapy as he offers practical solutions to help overcome the cognitive and emotional biases that may affect your investing decisions. Listen at schwab.com/financialdecoder.