The Weekly Show with Jon Stewart The Irrational Economy with Richard Thaler
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Feb 4, 2026 
Richard Thaler, Nobel Prize–winning economist and behavioral economics pioneer, discusses human biases, loss aversion, and the endowment effect. He explores nudges like opt-out savings and small design changes, debates bigger policy 'shoves' for climate and healthcare, and examines how markets and institutions shape real-world choices.
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Economics Often Ignores Real People
- Standard economics models assume perfectly rational agents and ignore real human behavior.
- Richard Thaler shows that introducing real people into models reveals predictable biases like loss aversion.
The Mug Experiment Reveals Endowment Effect
- Thaler ran a classroom mug experiment where randomly assigned owners demanded much more to sell.
- That experiment revealed the endowment effect and loss aversion in practice.
Status Quo Bias Drives Inertia
- People stick with what they have due to status quo bias and perceived switching costs.
- Economists often ignore this inertia when they assume frictionless choices.
