What it is:
Advising clients on behavioural biases that may affect consumer, firm or regulator behaviour, and the implications of these biases for markets and for public policy
Types of studies:
We can advise on a wide range of issues relating to behavioural economics, including:
Consumer behaviour — assessing whether consumer behaviour in a particular market or context may be affected by behavioural biases.
Firm behaviour — examining whether firms in a particular market or context are likely to respond to consumer biases in a way that exacerbates or exploits those biases, or alternatively in a way that mitigates the effect of those biases. Where appropriate, we can also analyse behavioural biases that may affect firms themselves.
Market outcomes and consumer detriment — assessing the effect of behavioural biases on overall outcomes in a specific market, given the interactions between consumers and firms. This may include analysis of the scope for consumer detriment.
Behavioural finance — analysing the effects of behavioural biases among investors on outcomes in financial markets.
Development of policy proposals — assisting in the development of policy proposals to address problems arising from behavioural biases (e.g. “nudge” policies, information disclosure etc.). This includes analysing the potential for unintended consequences.
Cost-benefit analysis — analysing and quantifying the costs and benefits of proposals designed to address problems arising from behavioural biases. This kind of analysis is relevant both to impact assessment of proposed policies and to evaluation of existing policies.