Behavioral economist Richard Thaler won the 2017 Nobel Prize in Economics Monday amid an impressive career spent working to uncover how humans are not always rational beings. Along the way, he discovered many quirky things about how we live our lives.
Critical to Thaler's work is the idea of the "nudge," or small nonmandated suggestions people or businesses can make to dramatically affect future behaviour by individuals.
CNBC tracked down a few of Thaler's most famous experiments and conclusions about human behaviour.
PEOPLE VALUE SOMETHING MORE IF IT'S THEIRS
Thaler and his colleagues gave coffee mugs to half of the students in a class and then opened a classroom market for mugs. Students who had already been randomly allotted mugs valued them at a far higher price than did the students who were not assigned mugs.
His work helped show that people place higher value on their own possessions, known as the endowment effect.
DRAWING A FLY IN A URINAL REDUCED BATHROOM CLEANING COSTS
Though Thaler is not credited with the original idea of drawing flies onto the back of bathroom urinals, he said it perfectly captures his idea of a "nudge."
The addition of a fly in a urinal actually changes (or "nudges") human male behaviour, encouraging people to aim for the image of the insect and thereby reduce "spillage" onto the floor.
CHEAPEST PLACE TO BUY PLYWOOD? HOME DEPOT BEFORE A HURRICANE
One would think that the most expensive time and place to buy wood would be just before a hurricane when everyone is flooding the stores to board up. Price gouging laws aside, one would think it certainly wouldn't be a cheap time to buy.
But companies like Home Depot and Wal-Mart actually see it as a time to gain long-term customers and have long elected not to raise prices when demand is this high.
"That's because those companies are in it for the long run. They want to be selling you stuff when you start fixing the house back up," said Thaler in an interview with CNBC in 2016.
PEOPLE WANT TO SAVE, JUST NOT RIGHT NOW
Because saving now "hurts" our paycheck, many people who manually manage their savings end up neglecting to save enough for retirement by continuing to prolong deposits.
In a 2004 paper entitled "Save More Tomorrow," Thaler designed a programme that allowed workers to commit themselves to saving later, each time they get a raise.
By committing themselves to this programme of automatic saving, Thaler observed that participants almost quadrupled their savings rate. Many companies have started automatic enrollment because of his work.
NFL TEAMS OVERPAY FOR TOP DRAFT PICKS
Thaler and colleague Cade Massey released a paper titled, "The Loser's Curse: Overconfidence vs. Market Efficiency in the National Football League Draft," in 2005. The report showed that teams routinely overpaid top draft picks relative to their eventual NFL performance.
The best "bang-for-the-buck" players were actually drafted in the second round.
Though some teams incorporated Thaler's work into future decision-making, others, while intrigued, continued to trade up when they saw a valuable player.
This article was first published in CNBC.