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Vera has a large color vocabulary and knows, for example, words that allow her to name a dozen different shades of green. Laura has a much narrower color vocabulary and knows only the basic color terms (e.g., "red," "green," "yellow") . If we test Vera's and Laura's ability to remember specific colors, we are likely to find that:
Rational Behavior
Human behavior based on comparison of marginal costs and marginal benefits; behavior designed to maximize total utility. See rational.
Cognitive Biases
Systematic patterns of deviation from norm or rationality in judgment, whereby inferences about other people and situations may be drawn in an illogical fashion.
Behavioral Economists
Experts in a field of economics that combines insights from psychology to understand how people make economic decisions.
Faulty Heuristics
Cognitive shortcuts that lead to errors in judgment or decision-making due to biases or flawed logic.
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