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Availability Heuristics and Its Applications in Behavioral Economics
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Abstract
Heuristics are often employed in simplifying decision-making processes but can also lead to thinking errors and biases. Availability is one common type of heuristics, which relies on the ease with instances coming to mind. It affects decision-making of consumers, investors, firms, and other perspectives, sometimes resulting in thinking biases. The topic is searching for the role of availability in the thinking process of consumers, investors and firms and put forward possible suggestions to diminish negative impacts and take advantage of positive effect. This essay begins by introducing an overview of heuristics and a precise definition of availability heuristics and then analyzes implications relevant to understanding individual behavior and economic outcomes. Subsequently, it explores the respective suggestions according to the analyses based on existing literature and statistical data. Through this exploration, availability heuristics affect the decision-making process, which is more obvious when things are more impressive by increasing the ease with them coming to mind. At that moment, to approach to perfect decision, thinking comprehensively is an integral part.
Keywords
availability, heuristics, cognitive shortcut, decision-making, systematic bias
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Cite this article
Gou,Y. (2023). Availability Heuristics and Its Applications in Behavioral Economics. Advances in Economics, Management and Political Sciences,43,192-196.
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Volume title: Proceedings of the 7th International Conference on Economic Management and Green Development
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