A New Foundation for Behavioral Economics

The existing paradigm for economics has long been acknowledged to be an inadequate model of economic behavior, just as Ptolemaic astronomy was an inadequate model of the movement of the planets. Existing behavioral economics amounts to adding epicycles to the failed paradigm. This book presents a systematic, precise, and complete framework for human economic behavior, constituting a new paradigm for the field. Since the beginning of the field of economics, it has rested on two foundational principles: 1) Choice is choice of 'basket of goods,' and 2) All uncertainty is modeled by probability. This work replaces both of those foundations with new ones by beginning with the observed facts about human behavior in the face of uncertainty. Homo Communitatis begins with a precise and complete formulation of the concept of human community, incorporates a systematic formulation of the concept of behavior going far beyond the traditional physical-process model, and shows how economic behavior is universally a matter of behavior of individuals in communities, and must be studied and modeled as such. The formulation of community and behavior is fully formalized, using the method of Aspect Specifications of States of Affairs.

• behavioral economics
• economic system
• economics
• modeling

H. Joel Jeffrey is Professor in the Psychology-Computer Science Department at the Northern Illinois University, USA. He has published several articles in academic journals including The Journal of Behavioral Finance, The Journal of Social Psychology, and Advances in Descriptive Psychology.

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