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The Role of Affect in Economic Behavior

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Handbook of Economic Psychology

Abstract

Many economic behaviors cannot be explained by the economist’s approach that people behave according to reasoning and try to maximize some utility function. Emotions do not seem to serve a role in this approach. Many human emotions seem to be irrational. But are emotions and affect not a integral part of our lives? Which functions do emotions serve? Are emotions counterproductive and disruptive for “normal” rational behavior? Why are consumers emotional about the products and brands they use? Which emotions play a role in investment behavior? Why do people actively seek sensations in sports and in watching movies? In this chapter, we distinguish several functions of affective processes in general and in economic behavior in particular, and withdraw from the notion that emotions are only irrational and dysfunctional.

“For many years the writer has been of the opinion that “emotion” as a scientific concept, is worse than useless” (Duffy, 1941: p. 283).

“And what is the role of emotion in the study of cognition? We leave it to the poet, the playwright, the novelist. As people, we delight in art and in music. We fight, get angered, have joy, grief happiness. But as students of mental events, we are ignorant of why, how” (Norman, 1985: p. 326).

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Authors and Affiliations

  1. Erasmus University, Rotterdam, The Netherlands

    Rik G. M. Pieters & W. Fred van Raaij

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  1. Rik G. M. Pieters
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  2. W. Fred van Raaij
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Editors and Affiliations

  1. Erasmus University, Rotterdam, The Netherlands

    W. Fred van Raaij

  2. Tilburg University, Tilburg, The Netherlands

    Gery M. van Veldhoven

  3. Stockholm School of Economics, Stockholm, Sweden

    Karl-Erik Wärneryd

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Pieters, R.G.M., van Raaij, W.F. (1988). The Role of Affect in Economic Behavior. In: van Raaij, W.F., van Veldhoven, G.M., Wärneryd, KE. (eds) Handbook of Economic Psychology. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-7791-5_4

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  • DOI: https://doi.org/10.1007/978-94-015-7791-5_4

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