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Richard Thaler Nobel Prize: News Conference at the University of Chicago

(Cheers and applause)>>All right, welcome, everyone, welcome. Thank you, everyone, for coming today. In a few moments we will hear from the winner
of the Nobel Memorial Prize in Economics. First I want to introduce the President of
the University of Chicago. Robert J. Zimmer. (Applause)
>>Robert J Zimmer: Thank you, everyone, for coming today. Good morning. It’s a great pleasure to be here this morning
as we discuss the work of Richard Thaler, a University of Chicago faculty member whose
insights and creative scholarship have earned him the Nobel Memorial Prize in Economics. Joining me on the stage this morning are Provost
Daniel Diermeier and Dean Madhav Rajan and, of course, our newest Nobel Laureate, Dick
Thaler. I would likes to recognize Lars Hansen and
Jean Falmouth (phonetic), also Nobel Laureates, who I believe are in the room oh, there they
are. Very nice. (Applause)
>>Robert J. Zimmer: I would like to offer just a few introductory words about Professor
Thaler, the Charles R. Walgreen Distinguished Service Professor of Behavioral Science and
Economics at the University of Chicago Booth School of Business. A major reason for Richard Thaler’s award
today is that his work provided scientific leadership in defining a new paradigm of economic
behavior at a level unusual in any field. In its citation today, the Academy cited his
historic role in building the field of behavioral economics, noting that his “contributions
have built a bridge between the economic and psychological analyses of individual decisionmaking.” His research has challenged existing assumptions
and proposed new ways of thinking about what motivates the behavior of individuals in the
economy. In doing so, Professor Thaler has forged a
completely new understanding of behavior in domains from household finances to issues
of national policy and shaped the thinking of international policymakers as well as colleagues
in the field of economics. This intellectual approach, one of questioning,
challenging assumptions, creative work in building a new field, defines the University
of Chicago’s distinctive intellectual culture which draws scholars and students across at
globe. It is a culture of challenge continuously
testing one’s own ideas as we freely test and challenge the ideas of colleagues and
students. Such demandinging methods lead to the highest
levels of collaborative work and academic achievement of the sort that is recognized
with Nobel Prizes. Richard Thaler becomes the 90th Nobel Laureate
associated with the University of Chicago and six current members of our faculty have
received the Nobel Prize in economics. (Cheers and applause)
>>Robert J Zimmer: Here to speak about Richard Thaler’s extensive contributions to the field
of economics is Dean Madhav Rajan of Chicago Booth. Thank you. (Applause)
>>Dean Radarajan: Thank you. Thank you, Bob. Good morning, everyone. I am delighted to welcome you here to congratulate
Professor Richard Thaler for being the awarded the 2017 Nobel Laureate in Economic Sciences. Not only is Dick known and respected for his
academic work and teaching in behavioral economics, he is widely recognized as a founding father
of the field. His research, as Bob mentioned, bridges the
gaps between economics and psychology. He studies the implications of relaxing the
standard assumption of a self interested rational economic agent; instead, entertaining the
possibilities that at some times, some people actually choose to behave as human beings. His revolutionary work changed academia and
had practical wide ranging implications. He represents the quintessence of Booth School
of Business’ mission: To produce knowledge with enduring and to influence and educated
current and future leaders. Dick has authored multiple best selling books
including 2008 “Nudge: Improving Decisions about Health, Wealth and Happiness” and more
recently “Misbehaving, The Making of Behavioral Economics.” In these and other publications, he creates
easy to understand scenarios that show how human behavior contradicts traditional economic
logic. “Nudge,” a book that Dick co authored with
Harvard Law Professor Cass Sunstein, explores how the concepts of behavioral economics can
be used to tackle many of society’s problems and influence public policy. The Best Book of the Year by The Economist
and Financial Times, his research prompted the UK government to establish a Nudge Unit
or Insight Team to create policies to enable British citizens to make better choices and
in turn save the state money. Dick served as an advisor in setting up the
unit’s guiding principles. In “Misbehaving” which The Financial Times
named one of the most influential business books of 2015, Dick struggled to bring the
discipline of economics down to earth and reveal economic analysis can change the way
we think about everything from household finances to the National Football League draft. Dick’s other books include “Quasi rational
Economics” and “The Winner’s Curse: Paradoxes and Anomalies of Economic Life”. Dick has numerous scholarly works as well,
published in the American Economic View, Journal of Finance and Journal of Political Economy,
among others. In 2015 he was President of the American Economic
Association; that year he was also named to Bloomberg Market’s list of the 50 Most Influential
People. Originally from New Jersey, Dick entered Case
Western University, receiving a bachelor’s degree in 1967. Soon after he attended the University of Rochester,
receiving a master’s degree in 1970 and Ph.D. in 1974. Over the years, Dick has taught at the University
of Rochester and Cornell University. He also served as Visiting Professor at the
University of British Columbia at the Sloan School of Management at MIT, Russell Sage
Foundation and The Center for Advanced Study of Behavioral Sciences at Stanford. Dick joined the Chicago Booth faculty in 1995
and at Booth he is the Charles R. Walgreen Distinguished Service Professor of Behavioral
Science and Economics. Dick played a major role in helping build
the behavioral sciences faculty at Booth, vastly expanding the school’s footprint and
stature in this field. On a personal note, within a few days of joining
Booth this summer as Dean, I had a visit from Dick and he gave me a copy of his book, autographed
“Misbehaving,” which you will not see on eBay soon. This is a fascinating read; a personal account
of developmental economics. On the inside cover, he had in a handwritten
note suggesting that I read Chapter 28 in particular. I would urge students and alumni and anyone
with an interest in understanding the faculty culture at Booth, I suggest that you read
that chapter. It truly is an honor to have Richard Thaler
as a member of the Booth community. We are thrilled for him and congratulate him
on his extraordinary career and well deserved recognition. Please welcome the 2017 Nobel Prize winner
in economics: Richard Thaler. (Cheers and applause)
>>RICHARD THALER: Thank you very much. I am pretty sure this is the first time that
the President, Provost and Dean have had a conversation about me in which the phrase
“pain in the ass” was not mentioned (Laughter)
>>RICHARD THALER: for which I am grateful. Although I am not sure that is a forecast
of future behavior. So, yeah, today’s prize does compensate a
bit for my disappointment at the Oscars two years ago. (Laughter)
>>RICHARD THALER: There is no prize for Best Behavioral Economist, which I think is unfair,
a topic I’ve studied at some length. I don’t really intend to give a speech; this
isn’t the Oscars. Thanking everybody would take forever. I had many, many co authors on my papers. Two that I should mention in particular. One is Cass Sunstein, our colleague here many
years, good friend and co author of “Nudge”. The other is Shlomo Benartzi, who is better
than anyone else at getting me to work. So, I have more papers with him than with
anyone else. The experience of being a Booth faculty member
is one of tough love. The behavioral science group it is a little
less tough, but only a little. It has been good to be here all these . . . these
20 years. Arguing with guys like Fama. (Laughter)
>>RICHARD THALER: It’s good for me. (Laughter)
>>Richard Thaler: And, you know, we now try to keep our arguments to the golf course. But Gene is in such a hurry, it is hard to
get in an argument. Just: Thanks to everybody. That’s all. (Applause)
>>MODERATOR: All right, Thank you. We have a little stage business to do here. I want to let people to know that there will
be opportunities in the coming weeks and months for the university to celebrate this award
at greater length. In the meantime, today, we are honored to
have representatives from the international media today and we promised them a chance
to ask some questions. We will provide that opportunity in just a
second. There are microphones for media to ask questions. For the benefit of the webcast audience, I
will do my best to repeat the questions so everyone can hear. So, with that, any questions from the media?>>MODERATOR: Yeah, media questions.>>(Indiscernible)
(Laughter)>>RICHARD THALER: But I am not allowed to
reveal her location.>>MODERATOR: Another question.>>RICHARD THALER: One question.>>One at a time.>>(Indiscernible)
>>So, where were you when the call came in?>>RICHARD THALER: I was asleep, very much
asleep. The call came at 4:00 this morning. My wife’s here. She can attest to that. They say, whatever you do, don’t tell anybody
for the next hour. Like there’s a lot of people that are awake,
waiting for your call . . . (Laughter)
>>RICHARD THALER: And then they ask you to participate in a press conference that they
have in Stockholm, assuming you have accepted, which I did. And, unlike Bob Dylan, I do plan to go to
Stockholm. So, thank you.>>MODERATOR: Thank you, other questions from
the media. Yes.>>(Indiscernible).>>The question is about getting mainstream
economists who accept your theories in behavioral>>RICHARD THALER: I think you used the word
“embrace.” I would say impossible. Embracing economists don’t do a lot of embracing,
actually. (Laughter)
>>RICHARD THALER: Psychologists are more like the hugging the hugging type than economists. You know, I always say that I don’t think
I’ve changed anybody’s mind in 40 years. You basically don’t change anybody’s mind. So, given that, I have used the strategy of
corrupting the youth. (Laughter)
>>RICHARD THALER: Whose minds are not already made up. So I think young economists, many great, young
economists have embraced behavioral economics. Some are full time practitioners. Others are just people who write things up;
they let the data speak. And the growth of the field in really due
to the work of the people that followed me. Let me mention a couple. Two were on our faculty early in their careers,
George Lowenstein and Colin Camerer. They didn’t really need to be converted. They had Colin was a student here, then returned
as a faculty member. And then people like David Laibson, Matthew
Rabin, Sendhil Mullainathan. If I go on, I’m going to insult so, all of
the people I am leaving out, just blame my bad memory. You know, we had this Russell Sage Foundation,
we started summer camp for graduate students in 1994. In fact, I was wearing my camp tee shirt this
morning when says Quasi rational on the front of it. (Laughter)
>>RICHARD THALER: Two of the students at that first camp were Labeson and Sendhil and
Matthew Rabin was counselor in training. Labson and Rabin have been teaching at the
camp for the last decade. That is where the field was really created. I think it was Danny’s idea to start that
camp. And I still go. It is a lot of fun. No marshmallows. But beer.>>MODERATOR: Next question.>>(Indiscernible).>>RICHARD THALER: Well, you know, my acting
without Celina there is not that good. Let me say the following. I already and I will pre empt one question
that some reporter may ask that I’ve answered a couple of times this morning: Economists
Lars and Gene I am sure were asked this question: So, what are you going to do with the money? (Chuckles)
>>RICHARD THALER: Now, most economists are too polite to say they think this is a stupid
question. (Chuckles)
>>RICHARD THALER: The reason they think it is a stupid question is that economists know
that money is fungible so what do you mean “this money”? So if I go out to dinner is it this money
or some other money? (Laughter)
>>RICHARD THALER: So, this is now, this isn’t a completely stupid question to me, since
I believe in something called mental accounting, which is precisely people putting labels on
money. So, what am I going to do with the money? What is left (chuckling) . . . any time I
spend any money that’ really fun, I am going to say: That came from the Nobel Prize. (Laughter)
>>MODERATOR: We will have time for a couple of questions then there will be time off the
main event is over. Next question?>>(Indiscernible).>>RICHARD THALER: Well, since Cass and I
wrote the book “Nudge,” right after that, David Cameron had read the book. One of his young team had bought a bunch of
copies and piled them up in a place where Cameron would see them and be nudged to read
one. They wrote in their manifesto, which is like
a party platform, that: If elected, they would apply behavioral science to public policy. Being used to American politics, I knew about
this, but never expected anything to happen. But they take their manifestos seriously there. They created this behavioral insight team. It was about six people originally. I have spent a lot of time with them over
the years. That group is now over 100. And according to the World Bank there are
now 75 such units around the world. So it’s happening. What are they doing? You know, when I was first working with that
team and I would go around talking to various ministers, I kept uttering the phrase: If
you want to get people to do something, make it easy. This is old wisdom from psychology from Kurt
Lewin: Remove barriers. I said it often enough that it sort of became
the team mantra. So, one of the things these teams do is you
try and make it easier for people to achieve their goals. So an example we wrote about in “Nudge” was
one of the hardest things students tell us about applying to college is the student loan
forms. Now, the government gives the loans. What is the information they need? It’s tax returns. Who has the tax returns? The government. And kids often have divorced parents who may
not be all that interested in sharing their tax returns with one another. But the government has all of the information. So, we argued for what they call pre populating
these forms. And doing that increases applications to college. This is an example of the lightest possible
form of “Nudge”. Just making it easier to fill out an application
that will encourage people to get more education and we think that’s good. Yeah.>>(Indiscernible)
(Laughter)>>RICHARD THALER: Yeah. I just shouldn’t go there, right? (Laughter)
>>RICHARD THALER: Let’s just say the obvious answer, I can think of pros and cons. And . . . you know, I just would say everybody
here should read that chapter about the offices. And no harm can come of that. (Laughter)
>>RICHARD THALER: But, yeah, people in business and government I think can learn useful ideas
and skills from you know, what have I done? I basically have made a career stealing ideas
from psychologists. And you can save the trouble of learning from
the psychologists directly just by looking at what I have stolen. (Laughter)
>>MODERATOR: There will be more availability now. But I think we would like to thank everyone
once more for coming today. Thank you very much. (Cheers and applause)
(Press conference concluded at 11:30 a.m. CDT)

Robin Kshlerin



  1. Kempton Lam Posted on October 9, 2017 at 10:12 pm

    Congrats to Prof. Thaler!
    9:14 Prof. Thaler is introduced and he received a standing ovation.
    9:54 Prof. Richard Thaler starts to speak
    13:35 Questions from the media

  2. vineeth km Posted on October 10, 2017 at 3:40 am

    Congrats to Prof. Thaler !!!

    From Dr Vineeth [ Kerala, India]

  3. Matthew Klapstein Posted on October 11, 2017 at 4:29 pm

    admirable that he took the approach described just after 16:00

  4. 张祎 Posted on October 12, 2017 at 1:18 pm

    Can anybody help me figure out what the speaker says at 00:44? "in a few moments, we're gonna hear from the winner of ??? recipient of Nobel memorial prize in economics"
    Thank you very much! I am an English learner~