Standard economic theory informs how we think about business strategy and the economy and presumes that people are selfish, have well-defined preferences, and consistently make welfare-maximizing choices. In other words, we are rational. But what if that is not the case?

Nobel Prize-winning economist Richard Thaler is out with an updated edition of his bestselling 1991 book, "The Winner's Curse: Paradoxes and Anomalies of Economic Life." In the new edition, he and his co-author Alex Imas (both professors at the University of Chicago Booth School of Business) reflect on the last thirty years of behavioral economics and how it makes sense of tensions between our psychological biases and impulses that make us less than fully rational in practice. Using a wealth of empirical evidence, the authors explore the behavioral anomalies that contradict the expectations of standard economic theory and explain a wide range of real-world examples from banking crises to social media addiction.

Earlier this month, Thaler joined Bethany and Luigi for a sold-out Capitalisn’t recording in front of a live audience in Chicago to walk through the anomalies of human behavior that have endured from biblical times to the age of Big Tech. Thaler reflects on how views and the adoption of behavioral economics have changed over the last thirty years, both within academia and beyond (wonder why you can’t put down your phone? Silicon Valley has read Thaler). He also shares how behavioral economics can influence public policy from canceling “junk fees” and dubious subscriptions to deciding which parts of the Affordable Care Act to keep and which are unlikely to produce their desired outcomes. Over conversation, light banter, and audience Q&A, Thaler shares his views on the state of capitalism and reveals how there is no grand unified theory of human behavior that incorporates all its irrationalities—only departures from the standard model.

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