. >> host: duke presser dan ariely, what do you teach here at duke? >> guest: i teach a few classes. i was teaching mba class on behavioral economics. teach a phd class psychology for economists. every year a change. one year i taught a class that was co-listed in economics and literature. i asked the students to either run an experiment on behavioral economics or to write a short story using principles from behavioral economics. when you're a tough debate undergrad class. last year i taught the class with kathy davis tried to learn from the students. >> host: what is behavioral economics? >> guest: may be the best they could think about it is a contrast to standard economics. so we have a view of the human being as being perfectly rational. people have power we can look into the future. they just always make the right decisions. these are actually assumptions. we just assume this is it. behavioral economics. instead of assuming everything puts people in different institutions and see how we behave. surprisingly people see how we behave very irrationa