We speed and drive aggressively out of overconfidence, and we disregard commonsense safety measures from too much optimism. We may even use a mobile phone while driving, preferring the short-term convenience of using the phone over greater long-term rewards like safety. We engage, in other words, in time discounting, the tendency to assign a lower value to future rewards than present ones.     All people suffer from cognitive biases, that while not deliberate or conscious, stem from the way their brains process information. But cognitive biases, like overconfidence bias; optimi ..read more

Behavioral economics is now firmly established as an essential tool in everything from product design and marketing to education and law enforcement. The realization that people have cognitive biases and often make decisions irrationally is not only an important psychological insight. It has also opened up a whole new area of policy innovations over the last 15 years in which low-cost behavioral interventions, or “nudges,” play a critical role in commerce and steer people towards more savings, greater safety, and better health.   The Inter-American Development Bank (IDB) has been respons ..read more

In a rapidly digitizing world, telemedicine promises to revolutionize healthcare delivery by offering remote medical services. It can lower costs, and it can expand access to underserved populations and geographically far-flung regions, not least in situations of crisis, like the COVID-19 pandemic, a natural disaster, or war.  However, despite its clear benefits, telemedicine has yet to be fully embraced by the public. Some people may distrust it, fearing that it offers a subpar experience with physicians. Some may dislike the inconvenience, including having to download and set up the te ..read more

With nearly 49,000 gun-related deaths in 2021, including homicides, suicides, and accidents, the United States has long been thought to be the gun capital of the world, with a staggering 120.5 firearms per 100 inhabitants. But its numbers pale in comparison to Latin America and the Caribbean when it comes to homicides. In 2021, nine of the 10 countries with the highest homicide rates worldwide belonged to the region, and a significant portion of those killings were committed with firearms. Grim statistics and the daily assault of headlines recounting the latest massacre in a home or workplace ..read more

European nations, stunned by Russia’s aggression, have mostly rallied in support of Ukraine, sending weapons and welcoming millions of refugees. But European citizens are paying dearly for it. Apart from the costs in direct assistance, the energy conflict with Russia had sent prices of gas soaring to eight times their 10-year average by the end of September and helped push inflation to around 10%. With a partial embargo of Russian oil going into effect in December and cold weather coming, many Europeans now fear an icy, bitter and poorer winter of 2023. European governments hope to take the e ..read more

Basic forms of digital media use, or virtuality, like videoconferencing have provided flexibility for workers, especially during the recent COVID-19 lockdowns. Some people have found that virtuality brings structure to their workplace and allows them to focus more intensely without the distractions of the office. Some experts suggest that it improves the sharing of unique information, that is, information held by only one team member. Experts, however, also say that it can hinder creativity by preventing all participants in meetings from access to peripheral visual stimuli that generate assoc ..read more

The COVID-19 pandemic has had an immense impact on people around the world, affecting every aspect of their lives, mostly in a negative way. In Latin America and the Caribbean, most governments have made controlling the spread of the new coronavirus a principal goal. Despite investing immense effort and resources in containing transmission, however, they have been unable to achieve a definitive end to the waves of infection. The problem is neither in the quality or quantity of the information provided on COVID. There have been highly publicized measures to decrease COVID transmission, includi ..read more

No matter how old we are, it is hard to imagine getting older. We are biased towards our present self and disconnected from our future one, stinting on our pension contributions, underinvesting in our education, and eating and exercising poorly with the mistaken feeling that the future will never catch up with us.  This present bias -along with an excess of optimism and other traits – can harm us as individuals and harm Latin American and Caribbean societies as the population ages. If we are stuck in the present and can’t project ourselves into the future, we can’t guarantee that we’ll a ..read more

How do people make decisions? How does behavior affect public policies? And can policymakers nudge people into doing things that will benefit them and society at large? Many issues related to the success of public policies come down to a, sometimes understudied, factor: human behavior. In our Behavioral Economics for Better Public Policies course, we focus on that fundamental issue. We teach how people’s behavior can affect public policies and how this knowledge can be incorporated into the design of better policies. Created by online education experts and supported by many champions of behav ..read more

The World Health Organization calls air pollution the No 1 environmental threat to health in the Americas. More than 60,000 people in Latin America died prematurely from exposure to fine particulate matter and  ozone in 2010. And with an increasing number of vehicles on the region’s roads, lax or non-existent emissions standards, and more frequent wildfires, the number of deaths due to air pollution in the region is predicted to increase. Regulations restricting vehicles in dense urban areas, better emission controls, and changes in the use of polluting cooking and heating stoves, among ..read more