The Disenchantment of Mainstream Economics

The authors of this book met early on in university. Both of us born and raised in Iceland, we nevertheless came from different directions, finding a common ground in academic works and talks. When the time came to write our respective final bachelor papers we quickly realized that our interests lay in the same area. By combining our specific fields of interest we, as well as our paper, would benefit. So with one graduating from economics and social development and the other from psychology, the apparent bastard that is behavioral economics raised both of our interest. What you hold in your hand is the result of our continuous talks, speculations and research. The Icelandic financial crisis was at its height as we wrote this and new information was coming into light almost everyday. In this paper we did our best to give a good overview of the field of behavioral economics, the Icelandic economic environment and its major crisis. Finally we strived to examine the cause and process of the crisis through the view of behavioral economics with the hope that this would give an alternative view of the the events that forever changed the landscape of the Icelandic economy.