Content Assessment: Balancing eDiscovery Consumption and Creativity? Considering Economic Psychology
Information - 91%
Insight - 93%
Relevance - 88%
Objectivity - 89%
Authority - 89%
A short percentage-based assessment of the qualitative benefit of the post highlighting a recent article published in Academic Letters in February of 2022 by Torben Larsen on the topic of Economic Psychology.
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Background Note: Neuroeconomics is a field of study that combines economics and neuroscience to understand how people make decisions. It seeks to understand how the brain processes information and how that affects economic behavior. Neuroeconomics has gained much attention recently due to advances in brain imaging technologies, allowing researchers to study the brain in real-time as decisions are made.
Several key elements of neuroeconomics are relevant to the study of decision-making. These include the role of emotions in decision-making, the role of cognitive biases in decision-making, and the influence of social norms and group dynamics on decision-making.
One of the key insights of neuroeconomics is that emotions play a much larger role in decision-making than previously thought. Traditionally, economics assumed that people make decisions based on a rational calculation of costs and benefits. However, neuroeconomics research has shown that emotions such as fear, anger, and happiness can significantly influence decision-making.
Another important aspect of neuroeconomics is the role of cognitive biases in decision-making. Cognitive biases are systematic errors in thinking that can lead people to make irrational decisions. For example, sunk cost bias is the tendency to continue investing in a project or decision even when it is no longer rational to do so. Understanding these biases can help people make more informed and rational decisions.
Neuroeconomics also looks at how social norms and group dynamics influence decision-making. For example, research has shown that people are more likely to make certain decisions if they believe that others around them are making the same decision.
All of these elements of neuroeconomics are highly relevant to the creators and consumers of eDiscovery software and services. Understanding how emotions, cognitive biases, and social norms influence decision-making can help creators of eDiscovery software design more user-friendly and effective products. It can also help consumers of eDiscovery services make more informed decisions about which products to use.
In the following article, “Economic Psychology,” retired health economist Torben Larsen from the University of Southern Denmark delves into the field of economic psychology. The article may be useful for cybersecurity, information governance, and legal discovery professionals seeking to understand the psychology of reciprocity between consumers and creators (and innovators) in the eDiscovery ecosystem.
Educational Paper on Economic Psychology*
Economic Psychology (Academia Letters Article)
By Torben Larsen
Market-driven economic growth is based on a psychology of reciprocity between a majority of consumers maximizing utility and technological creativity by a small minority. The neural correlates to these qualities in the Frontal Cortex explain the option of economic growth. The Big5 psychology integrates neuroeconomics into a positivist economic psychology with personal risk-will as a parameter. The open-minded [individual] is identified as a key person in forming social standards, for instance, regarding consumption and technological development. Economic psychology appears as a pragmatic step-by-step alternative to idealist Humanistic psychology. “Simple Living” is identified as rational behavior in digitized economies with low marginal utility. It comprises a variety of humanistic alternatives to consumerism.
However, today market-driven growth is challenged by severe market failures, for instance, the Greenhouse effect. Psychology identifies the basic effect of culture as a moderation of opposites. In economic policy, moderation means better democratic collaboration across the center, for instance on a Tariff on CO2 emission that lets the polluter pay for the transition to a carbon-neutral economy.
The core of Economics is the vision of better human conditions by economic growth [Smith, 1789]. Economic growth is illustrated where the broad condition is consumers maximizing utility while a minority of creative entrepreneurs deliver technological progress. Simple machines, such as the “Spinning Jenny” and steam engines, inspired to conceptualize the First Industrial Revolution [Smith, 1789].
Today, we are in the midst of digitizing, the Fourth Industrial Revolution [Schwab, 2017]. This includes brain scanners so sensitive to emotions and thoughts that they have become veritable “Mind Readers.” Neuroeconomics is today a new multidisciplinary field between Neurology, Psychology and Economics. This study focuses on how Neuroeconomics can contribute to economic growth.
Economic Psychology - Torben Larsen - 2022
Reference: Larsen, T. (2022). Economic Psychology. Academia Letters. https://doi.org/10.20935/AL4873.
*Open Access – Distributed Under CC BY 4.0
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