Monday, December 8, 2008

New Era of Ag Econ

Last week I had the honour of being invited to the University of Nebraska to present my research on farm animal welfare.  At a party afterwards, I had a conversation with a researcher who received his PhD the year I was born.  He was, you could say, an economic behaviorist before his time; much of his research concerned violations of a standard rational utility function (what Diedre McCloskey calls the Max U framework).  In all those years, he was never able to get those studies published in an ag econ journal, because it violated Max U, but had to seek other journals.

Because my research on farm animal welfare assumed people may care for humans and animals other than themselves, he asked me if I had the same problem.  The answer is a definite no. Perhaps ag econ has drastically changed over the years, taking the Max U framework too seriously in the past when the economics profession never did.

Example: Jayson Lusk and I have a behavioral economics paper coming out in the American Journal of Agricultural Economics, where we show that contrary to the Max U framework, there can be a thing as too much choice (duh!).  The paper consists of four experiments, one of which shows that a significant portion of people are willing to voluntarily forgo choice and opt for a smaller choice set size, solely for the purposes of making the decision task easier.

The question is: are we behind the curve in the classroom as well?  Are we at least mentioning some of the results of behavioral economics?

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