Public Policy and Behavioral Economics

For those interested in behavioural economics, and its relevance to public policy, the recently released book by Congdon, Kling and Mullainathan, published by the Brookings Institute press, is essential reading. Entitled “Policy and Choice: Public Finance through the lens of behavioral economics”, the full book is free to download as a pdf file from the website. This is the best summary of the application of behavioral economics to public policy questions that I have read. There are chapters on asymmetric information, externalities, poverty and taxation, as well as summary and overview chapters. Ireland is in the process of fairly dramatically redesigning our health and pension systems and the insights from this book are extremely important to consider in this process. The first three chapters, in particular, are concise and clear descriptions of the main directions in this literature.

5 replies on “Public Policy and Behavioral Economics”


Thanks a lot. Looking forward to reading this.

Hopefully free copies are being made available to the ESRI.


@ Liam Delaney

Many thanks for this. Let’s hope that some of this filters through to some of our policy makers in Ireland – not just in terms of designing new policies, but also in the application of existing powers. Reading through the heuristics and biases in this book is like cataloging the past and ongoing mistakes by policy makers in both Ireland and Europe (Dylan Grice from SocGen wrote an excellent note on this topic last year ).

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