Guilty on One Count: Negligence (of Opportunity Cost)

The concept of opportunity cost is not foreign to most people who have taken an introductory economics class at some point, nor is it terribly complex to grasp if you don’t have that background. Basically, it is the value attributed to the next best thing that has been foregone in favor of something else. Many economic models take this principle into account when they are interpreted to describe consumer behavior. However, when it comes to application in the real world, Frederick et al. (2009) argue that this assumption that consumers evaluate their opportunity cost at every turn does not hold Continue reading Guilty on One Count: Negligence (of Opportunity Cost)

Say Thank You and Kiss the Traditional Economy Goodbye

It seems like everybody who watches Marie Kondo on Netflix ends up furiously cleaning out their room while mumbling, “does this bring me happiness?” It’s not hard to see that minimalism is a re-emerging trend hitting consumer behavior full force. It originated as an art movement during the 1960s and since then has developed to become a lifestyle; mainly because of financial trauma caused by the 2008 crisis. People were forced to reduce ownership of excessive goods and consciously reflect about their purchases. This is the whole minimalist purpose: to only keep truly useful, beneficial, and memorable items. But why has Continue reading Say Thank You and Kiss the Traditional Economy Goodbye