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DR. LOEWENSTEIN: PANDEMIC CHANGES PEOPLE’S SPENDING STYLE

In the USA, a behavioural economist studied the impact of the Covid-19 outbreak on people’s spending. Professor George Loewenstein said that the savings rate increased with the coronavirus. Loewenstein also said that offering people money to get vaccinated would be perceived negatively.

14.03.2021

Dr. George Loewenstein, Professor of Economics and Psychology at Carnegie Mellon University, stated that the new type of coronavirus (Covid-19) epidemic has an impact on the behaviour of people and companies and that savings increased during the epidemic period and that the distribution of household expenditures by sectors changed.

Dr. Loewenstein, who is also the co-director of the Behavioural Decision Research Center, made evaluations about the impact of the epidemic process and anxiety level on socioeconomic decision-making behaviours in behavioural economics.

Pointing out that human behaviour plays a big role in the course of the epidemic, Dr. Loewenstein underlined that behavioural economics focuses on human behaviours and has a much more realistic understanding of what drives people or how they perceive risks than traditional economics.

“Behavioural economics can be associated with any dimension of a potential epidemic related to human behaviour,” Dr. Loewenstein added.

Emphasizing that the idea that people are “narrow-minded” is one of the themes of behavioural economics, Dr. Loewenstein gave the example that “people often fight fires but are not good at preventing them.”

“Behavioural economics can be used to make governments think ahead of an epidemic and take measures to prevent future outbreaks. Even if an outbreak occurs, we’ll be better prepared,” Dr. Loewenstein concluded…

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