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This monthly series directed at students, their parents and their teachers. The purpose of the column is to interpret economic and financial news for young readers, giving them information they need to understand the global economy. Additional resources help parents and teachers to continue these topical conversations with their children and students.
Thanksgiving is coming soon. You know what that means. Family, friends and food - lots of food. If you've been reading this column, you know that economics can be applied to just about any issue and life situation; even those you might not think of as being economic ones. Thanksgiving dinner is another one of those situations.
When you think about Thanksgiving dinner, what do you think about? How good the food is? How much food there is? Uncle Fred's shirt buttons straining by the time dinner is over? Many of us exhibit an alarming lack of self-control when it comes to turkey and trimmings, but, from a traditional economics perspective, this yearly gluttony does not make any sense. Economics assumes that people are rational: they weigh - pun intended - the costs and benefits of actions and choose those that have higher benefits than costs.
A growing branch of economics, called behavioral economics, shakes up traditional economic assumptions like rationality, and recognizes that people are often irrational. Irrational, but still predictable. Therefore, if we start from the premise that people can be predictably irrational, can we use economics to substitute for self-control? Can economics save you from yourself on Thanksgiving Day? In a word, yes.
One of our behaviors that is very predictable, yet irrational, is the fact that we tend to eat more when there's a lot of food in front of us. This makes no sense from a cost/benefit viewpoint, but numerous studies indicate it is true. How do you make this knowledge work for you when self-control is lacking? Put the food in the kitchen, not on the table. Use small plates. Irrationally, we judge how much we are eating by how much food is left, not how full we feel. If you make it appear that little or no food is left, you'll eat less.
Another one of our predictable irrationalities has to do with variety. In a study of mice, a male and female mouse tire of mating with each other fairly quickly. However, when additional mice were added to their environment, they mated with the newcomers. The original pair wasn't tired of mating, they were just bored. How does this help with Thanksgiving dinner? The more variety you have in front of you, the more you're likely to eat. To cut down on your consumption, have fewer varieties of food available.
The last of our examples of predictable irrationality is the focus on the day itself. We tend to place a lot of attention on our consumption on Thanksgiving Day and ignore our consumption on the other 364 days. In terms of sheer caloric count, this makes no sense. The average person will consume about 4,500 calories during Thanksgiving dinner. That's a lot, but it's much more rational to be vigilant about the rest of the year and cut loose on Thanksgiving, guilt-free.
Economics has a lot to offer in terms of explaining a whole host of everyday situations. If you can't use economics to substitute for self-control, remember the other 364 days, and have a happy, rational Thanksgiving.
Take this opportunity to help your students or children think about and express themselves about the rationality of economic thinking. Visit www.economicscenter.org/whyitmatters for a lesson to guide this discussion with your children or students.
Julie Heath, PhD is the Director of the Economics Center and Alpaugh Family Chair in Economics at the University of Cincinnati's Carl H. Lindner College of Business.