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Policy Seminar

Crisis and Everyday Personal Finance:

Lessons from Behavioural Science and Political Economy

Wednesday 15 February 2017, 16.00 - 17.30, Brussels


In moments of crisis, we are often required to make difficult and quick decisions relating to our personal finance. These decisions can have far-reaching consequences: in some cases, they can quite literally make or break a person’s livelihood. Clearly, therefore, it is important to understand the cognitive processes and pressures that lie behind our decisions.

Our roundtable featured thoughts and reflections on this important subject by three leading experts from the fields of Behavioural Science and Political Economy in the University of Warwick:


1. Dr. Chris Clarke, ‘Everyday Experiences of Debt in Times of Crisis: Lessons from Online Lending’

Online lending platforms are increasingly reshaping how consumer and small business lending is facilitated. These platforms exist within an emerging ‘FinTech’ and ‘alternative finance’ landscape, which is seeking to challenge some of the core activities usually associated with bank lending and infrastructures. Dr Clarke investigates the rise of online lending platforms from the perspective of the everyday borrower. Findings suggest a convergence of financial and technological expertise is leading the sector to evolve towards a particular conception of risk management, principally based on the latest developments in digital data analytics. The promises and pitfalls of this approach are also outlined.


2. Dr. Adam Sanborn, ‘Limited Cognitive Tools for Decision Making?’

Much recent research on the psychology of decision-making has emphasised the limitations of human cognition. Books such as Daniel Kahneman’s Thinking, Fast and Slow and Gerd Gigerenzer’s Simple Heuristics that Make Us Smart argue that we solve complex decision-making tasks with limited cognitive tools. These limited cognitive tools explain why people often make glaring errors in decision-making tasks, especially those involving probabilities. Drawing on new evidence from the laboratory, Dr Sanborn will show that limited cognition is not always to blame for these errors. Instead, people often misunderstand how best to solve decision-making tasks, even when they have the cognitive tools to solve them.


3. Dr. David Webber, ‘Managing Crisis in the Beautiful Game: The Political Economy of Safe Standing’.

Recent debates over the introduction of ‘safe standing’ in British football grounds provide a fascinating window onto the issue of how individuals make difficult calculations about personal finance. Despite memories of the Hillsborough disaster, which led to the death of 96 Liverpool fans in 1989, and despite residual security concerns, there is now growing popular and political support for ‘rail seating technology’ to lower ticket prices. What does this tell us about the importance people place on personal finance and the sacrifices they are willing to pay in order to secure their everyday economic livelihood?


Presentations from the roundtable can be found here:

For more information on the roundtable click here