And it's most notably with us today, at least at the cutting edge, in Behavioral Economics. Behavioral Economics is thought of as of a very new and novel and influential branch of economics but it's behavioral that's why it's called behavioral economics. And the point is it has that same approach of thinking about what people actually do as oppose to trying to ask the question of why. So, behavioral economics associated with people like the. The Nobel laureates Daniel Kahneman and Amos Tversky, or Dan Ariely, or Richard Thaler. Behavioral Economics says, let's look at what people actually do. Let's not look at abstract economic theory which says people will always respond perfectly to incentives. So you've probably heard the old joke about, or maybe you haven't, the old joke about that an economist is walking down the street and sees a $20 bill laying on the street and keeps on walking by. Because the economist says, well, no, that can't possibly be a $20 bill there. Because- here's my great diagram of a 20 dollar bill, not sure if that helps much but make something interesting happen. if there were actually a $20 bill lying on the street, someone would have picked it up. We know that people are incentivized to pick up a $20 bill, so it can't possibly be there because economic theory tells me it must have already been picked up. Ha-ha. Okay, well the point there is, in reality, people don't always conform to abstract economic theory. So behavioral economics says let's look at what people actually do, and one thing that they do is they feel much more concerned about losses than gains. In theory, the additional satisfaction you get from gaining $100 dollars should be identical to the satisfaction you lose by losing $100, not so. People will take far more steps to avoid the loss than they will to achieve a gain of equal magnitude. Defaults are important. In economic theory, it shouldn't matter, for example, whether something's opt in or opt out. So if the company you work for says check this box to put money every year into your 401k. It should lead to exactly the same result as if the company says. This money will get put into your 401 K, unless you check this box to say ,no don't do that. Turns out we know empirically that much more money goes into the 401 K if it's the opt out. If by default the money goes in, even though it doesn't require anything that hard to just check a box People tend to go with the faults. Confirmation bias. People tend to see what they are looking for. If you think that you're going to get a certain result, then you tend to find it. because our brains tend to want to see patterns, whether or not they're really there. And again, economic theory in the abstract says that shouldn't be the case. Behavioral economics modifies it and says, empirically we know people behave in certain ways. Okay, here are some takeaways on behaviorism, all of which are very relevant for gamification.