Richard H. Thaler
Traditional economics often models people as rational calculators, but real decisions are shaped by psychology, context, and bias. This book shows how bringing those patterns into economics helps explain everyday financial behavior and market anomalies.
People assign greater value to items simply because they own them, creating a wedge between what they will pay to acquire something and what they demand to sell it.
Rather than treating all money as identical, individuals divide their wealth into subjective mental accounts, which helps explain why people simultaneously hold high-interest debt and low-yielding savings.
Consumer choices are heavily driven by the perceived fairness of a deal rather than just the objective value of the item, making discounts and sales effective psychological tools.