Journal Article

Mindful Economics: The Production, Consumption, and Value of Beliefs

Tirole, Jean, Bénabou, Roland

2016

Overview

In this paper, we provide a perspective into the main ideas and findings emerging from the growing literature on motivated beliefs and reasoning. This perspective emphasizes that beliefs often fulfill important psychological and functional needs of the individual. Economically relevant examples include confidence in ones' abilities, moral self-esteem, hope and anxiety reduction, social identity, political ideology, and religious faith. People thus hold certain beliefs in part because they attach value to them, as a result of some (usually implicit) tradeoff between accuracy and desirability. In a sense, we propose to treat beliefs as regular economic goods and assets—which people consume, invest in, reap returns from, and produce, using the informational inputs they receive or have access to. Such beliefs will be resistant to many forms of evidence, with individuals displaying non-Bayesian behaviors such as not wanting to know, wishful thinking, and reality denial.

• Publisher: American Economic Association
• Subject: Analysis / Anxiety / Assets / Bayesian analysis / Behavioral decision theory / Belief & doubt / Beliefs / Climate change / Cognition & reasoning / Commercial production / Consumer psychology / Consumption / Decision making / Economic goods / Economic models / Economic motivation / Economic theory / Economic value / Economics / Housing prices / Mindfulness / Motivation / Political ideologies / Psychology / Religious beliefs / Religious identity / Self concept / Self deception / Self esteem / Social anxiety / Social identity / Studies / Symposium: Motivated Beliefs / Tradeoff analysis / Value