The World Bank’s conference on “The State of Economics, the State of the World” was an opportunity to take stock of the emergence of new paradigms for understanding economic development. Following Ken Arrow’s talk on the history of the neoclassical model and Shanta Devarajan’s comments on this model’s centrality in the Bank’s work, I had the opportunity to discuss two paradigms of how individuals make decisions that have recently emerged in economics, drawing on psychology, sociology, and anthropology.
If you put a target in the toilet, men will miss less. That’s the intuition behind the proliferation of strategically placed fake flies in public urinals. While anyone who has had to clean up after a careless aimer might say, “It’s about time,” anyone who has studied behavioral economics might say, “It’s about games.”
Games are fun. We play them for hours on end, of our own free will, without pay, in return for a feeling of accomplishment or virtual badges or points or just the promise of seeing all the cards bounce across the screen at the end of Windows Solitaire.
Development, on the other hand, is serious. People’s health, happiness, and well-being are at stake. Super Mario Brothers? Game. Candy Crush Saga? Game. Poverty, hunger, disease: Not games.