Assessing the Socio-Economic Consequences of Corona in Iran, from the Behavioral Economics Perspective

Document Type : Research Article

Authors

1 Ph.D. student, Department of Economic Sciences, Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran

2 Associate Professor, Research Economics Department, Economics Research Institute, Tarbiat Modares University, Tehran, Iran

3 Associate Professor, Department of Economics, Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran

4 Associate Professor, Agricultural Economics Department, Economics Research Institute, Tarbiat Modares University, Tehran, Iran

Abstract

Behavioral economics is a method of economic analysis that uses psychological insights to explain and analyze economic decisions. In the researches done so far, more attention has been paid to the economic aspects of the current crisis and less attention has been paid to the social dimensions and the issue of behavioral economics has been neglected. In the present study, we examine the most important behavioral biases of individuals during the corona pandemic. In order to investigate the social consequences of the corona pandemic and to estimate the relationship between economic and demographic variables with behavioral economics theories, the choice experiment was selected and the mixed logit model was used and by estimating the mixed logit model with interactions a wide range of multiplicative states between personality traits and traits specific to the alternatives were tested. Finally, the variables of age, number of children, income level and awareness of the consequences of corona disease were multiplied by the price with a significant effect and explanatory power. For example, it was observed that older people are less willing to pay more to reduce the consequences of corona disease or having more children has a negative and significant relationship with the selection and additional payment of people to reduce the consequences of this disease. From the perspective of behavioral economics. the result of the estimates confirms a kind of “(effect) of collective behavior and social impact” and “exploratory effect” in people’s behavior, which indicates the preference of economic dimensions over the social dimensions of the disease and the great importance of people to family problems caused by the disease, respectively.

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References

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Journal of Applied Economics Studies in Iran
Volume 11, Issue 43
December 2022
Pages 209-236

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