Behavioral Economics

Dan Ariel speaks about his book Predictably Irrational – a great book if you have not yet read it. In this video he describes behavioral economics. Another way to describe this is the science of behavior that the business world has not yet adopted. Dan Ariel shows us how humans continue to see things in one way and make decisions on those observations, even when they are wrong. Through its Just Ask Leadership Assessment, CO2 Partners has discovered that leaders who lead from a belief of not knowing versus from that of knowing have two times the engagement and alignment from their teams. In other words, if the leader suspends their belief that their way is right and allows others to participate or make the decisions, they will increase performance. How does this relate to Dan Ariel’s work? Often leaders struggle to suspend their belief in knowing – thinking that they really do have the right answer. Dan Ariel’s work really helps leaders understand that what they believe to be true is not always actually true.