Economist Richard Thaler won the Nobel Prize in economics yesterday for his work in Behavioral Economics. This is a field of study of the complexity of human decision making. He is second person to win a Noble Prize in economics for Behavioral Economics. Psychologist Daniel Kahneman won the same award in 2002. The field is a bridge between economics and psychology in decison making.
The mainstream model of people making decison as rational-utility maximizers, was upended by the studies by Thaler, Kahneman and others. They introduced us to many concepts that come into complex decision making including: "endowment effect", "loss aversion", "status quo bias", and "winner’s curse”. People are complex. Behavioral Economics helps us understand this complexity.