Welcome to the exciting world of Behavioral Economics! In this fascinating field, we explore how people's choices don't always match their preferences and how we can encourage them to make better decisions. We'll also learn about "choice architecture" and "nudge theory," which are powerful tools to influence choices in a positive way. So, let's dive in and make economics fun!

Choice architecture is like the magic behind decision-making. It's all about how choices are presented to us and how that affects what we choose. Imagine you're at a restaurant, and the menu is designed in a way that highlights the healthy dishes—guess what? You're more likely to pick something nutritious! Here are three cool ways choice architecture can work.

• Default Choice: This is the option you get if you don't actively choose something else. For example, in a world where everyone's organs are automatically donated upon death (the default choice), organ donation rates would likely soar! Of course, anyone can still choose not to donate, but they'd have to opt-out, which most people wouldn't bother doing
• Restricted Choice: Sometimes, having too many options can be overwhelming. By limiting the choices, we can make decision-making easier and lead people to better outcomes. Take pensions, for instance. If we present a simple and clear set of pension plans, more folks would likely enroll and make better decisions for their future.
• Mandated Choice: This is like a cousin of the default choice. Here, the government requires us to make a decision by law. For instance, when applying for important documents like a passport or driver's license, we might be asked if we want to be organ donors. It ensures we actively think about the decision.