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If people were perfectly rational, product design would be simple. But we’re not. We buy things we don’t need, ignore evidence that contradicts our beliefs, and abandon purchases at the final click.
Behavioural economics helps explain why.
By blending psychology with economic theory, behavioural economics challenges the assumption that people always act in their own best interest. It reveals the patterns, shortcuts, and emotional triggers that guide our choices every day – especially when we’re not aware of them.
Traditional economics assumes people make logical decisions based on all available information. Behavioural economics shows that real-world decision-making is messier. We operate with limited time, attention, and memory. We rely on mental shortcuts, called heuristics, to help us decide quickly. But those shortcuts come with trade-offs.
Rather than judging decisions as "irrational," behavioural economics helps us understand them. It looks at the environment, emotional context, and subconscious influences that shape behaviour.
One of the most important ideas in behavioural economics is bounded rationality. This means we don’t have unlimited capacity to make perfect decisions, so we make the best choices we can with the information we have.
We also rely heavily on heuristics – simple rules of thumb that help us make quick decisions. While useful, they can lead to predictable errors, or cognitive biases.
A few powerful concepts include:
Loss aversion
People feel the pain of a loss more strongly than the pleasure of a gain. This explains why limited-time offers and risk-free trials are so effective.
Framing
How a message is presented changes how it’s received. For example, more people will opt for surgery when told it has a 90% survival rate than when told it has a 10% mortality rate – even though it’s the same statistic.
Anchoring
Our decisions are influenced by the first piece of information we see. The initial price you see for a product will shape what you think is a "good deal."
We see behavioural economics at work every time we:
These aren't random behaviours. They're deeply influenced by context, design, and framing.
Understanding behavioural economics isn’t about manipulation – it’s about alignment. Product teams, marketers, and healthcare providers can use these principles to create experiences that:
Whether it’s helping someone stick to a health plan, sign up for a new service, or complete a purchase, behavioural economics gives us tools to design more human-centred systems.
People don’t always act logically – and that’s okay. Behavioural economics helps us build for real-world behaviour, not idealised models.
At nuom, we use these insights to support teams designing better experiences. When we understand what drives decisions, we can design with purpose, clarity, and empathy.
Want to explore how behavioural economics could shape your next product or campaign? Let’s talk.
We create human-centered solutions that drive positive outcomes for users and organisations. Let’s collaborate.
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