Amazon, Facebook, and Google (AFG) and other social networks are collecting information on us to increase the value of the advertisements and products they sell. Some worry in a vague way about how this is reducing our personal privacy. Others increasingly worry that our personal information is being used to manipulate us and to control the flow of information across society.
In a previous post, I described how behavioral economics (specifically Prospect Theory) applies to products and why Steve Jobs’s fanatical dedication to perfection was so unique and valuable for Apple. The same basic ideas from the behavioral sciences apply to other areas, like giving bonuses a bit at a time or why bad news should be confronted all at once. (more…)