Industry application of behavioral science

Abstract

One of the more significant errors in the history of science occurred during the "marginal revolution" in economics near the end of the nineteenth century. Rather than explicitly recognize in basic theory that the happiness we seek to maximize in life originates within oneself, the early theorists formulated their equations as though human satisfaction resided in external things-as in so much utility (economist's term for satisfaction) per pound of sugar. Over the past 125 years, economists have developed mainstream mathematical economics on this incorrect basis resulting in the ill-founded neoclassical Equilibrium Theory. Because of this error economic theory is fundamentally timeless. The present theory, in its canonical form, corrects the early marginalist's error by identifying utility (time-integrated pleasure) exclusively with the stream-of-consciousness attending (expected) mental and physical activity. Time is now explicit in basic theory, thereby allowing, for the first time, the substantive computer-modeling of time-dependent, small- and large-scale economic systems. Furthermore, this new approach is methodologically compatible with mainstream sociology and institutional economics, allowing increased interdisciplinary cooperation that may influence policy and thereby affect industry and markets. And safety engineering stands to benefit from the accommodation of neuropsychology in understanding human error in the supervision and control of technology.