Overview
Economic psychology is a fascinating field that examines how psychological factors shape consumer behavior and decision-making. It combines insights from psychology and economics to understand why consumers make certain choices, often revealing that decisions are not always rational. Concepts like c...
Key Terms
Example: Behavioral economics explains why people might spend more on a product due to perceived value.
Example: A consumer feels cognitive dissonance after buying an expensive item that they later regret.
Example: Consumer behavior research helps companies understand what drives purchasing decisions.
Example: Decision making can be influenced by emotions, social pressures, and marketing tactics.
Example: Nudge theory is used in public health campaigns to encourage healthier choices.
Example: Consumers may perceive a product as a good deal if it is initially presented with a higher price.