THE capuchin monkeys working with economist Keith Chen and psychologist Laurie Santos know a good bargain when they see one. They use metal chips as money, buying bits of apple or cucumber from humans, and they seem to know what they’re doing. When the researchers make apple cheaper than cucumber – offering more food for the same number of chips – the capuchins opt for the better-value food, as any savvy shopper would. Yet it is not the monkeys’ good economic sense that Chen and Santos find most interesting. Rather, it is their tendency, on occasion, to make an irrational deal – and to do so in a distinctively human way.
Over the past three decades, economists have come to accept that people aren’t the purely “rational” and “selfish” individuals that classical theorists once imagined. Numerous experiments have shown that we often let apparently irrelevant factors influence our economic decisions: ..