As everyone knows, Richard Thaler has won the Nobel Prize in economics. Thaler’s prize was mainly for behavioral economics, which built upon the work of the earlier nobel laureate Daniel Kanneman.
This work has been controversial. Many rational choice economists have strongly criticized it and some of those people have been free market advocates. But free market advocates come in different stripes and certainly the Austrians would criticize the rational choice perspective as well. For an interesting exchange on these matters, take a look at this symposium on behavioral economics on the Truth on the Market Blog and the response from Richard Thaler himself.
While I find some of the work of the behavioral economists quite interesting, my main concern is with their failure to apply the same methods to government in general and to administrative agencies in particular. What could possibly justify this failure other than political bias?