Comparing Irrational Idiots to Rational Agents: The Significance of The Affect Heuristic in Behavioral Economics

Abstract

With the intention of providing an overview of two significant cognitive patterns, this essay will be written. Naturally occurring traits such as intuition, automaticity, and naturalness are what distinguish the experiential mode from other modes of learning. Connotations that are both positive and negative can be attributed to the development of mental imagery over the course of time. Analytical, deliberate, and reason-driven are the defining characteristics of the alternative method of operation. In what follows, I will outline recent empirical research that shed light on the concept of the affect heuristic. These can be found in the following discourse. What is meant by the term "affect heuristic" is the heuristic that enables humans to behave in a rational manner regardless of the circumstances they are in.When people are able to precisely anticipate the positive or bad results of their decisions based on their previous experiences, it is a very successful endeavor.In spite of this, it was declared a failure when the final findings were found to be significantly different from the forecasts that we had made initially.It is feasible that the logical actor will turn out to be the reasonable idiot when the conditions that were discussed earlier are taken into consideration.

Keywords: significant cognitive patterns, Connotations, empirical research.