A recent article in Behavioral Scientist presents Richard Thaler as the founder of behavioral economics. This is misinformation.

Thaler was effective at packaging and promoting psychological research in ways that economics couldn’t ignore, while he most certainly did NOT discover human irrationality.

Common sense, right? Claiming someone recently discovered human irrationality is itself irrational… the latest evidence confirming ancient theories of human irrationality.

More specifically, making claims about “observing that people are influenced” – the fundamental insight that context and framing affect decisions – definitely is NOT Thaler’s invention.

Herbert Simon won a Nobel in 1978 (before Thaler even started) for work on bounded rationality. Kahneman and Tversky’s prospect theory was then presented in 1979. An endowment effect was documented by Thaler, yet the fundamental psychology of loss aversion came from Kahneman and Tversky. Going back earlier, researchers like Ward Edwards in the 1950s-60s presented psychological research on decision-making that challenged expected utility theory. And we really should include Smith, Wollstonecraft, Kant and Hume (published extensively that human reasoning isn’t purely rational calculation), as I wrote here in 2016, about some of my work in 2014.

I say this because nobody should be calling Thaler the founder of behavioral economics (he helped establish a distinct field in economics, but absolutely didn’t invent the ideas or lay the foundation). The article frames “anomalies” as Thaler’s discovery, despite economists and psychologists documenting violations of rational choice theory for decades. And then, insult to injury, the article says Imas’ career progression is defined by some weird proximity to Thaler (“once a distant role model… now a friend and collaborator”).

With propagandist articles like this, it’s no wonder economists are skeptical of behavioral theory as glorification of propagandists.

The misinformation serves a specific function: it centers credit within economics (and specifically at Chicago, infamous for hero seeking radical individualism) rather than acknowledging that economics was VERY late to recognize what other disciplines already knew and shared with them.

Thaler’s actual contribution was politics and marketing of others’ work to fit his own sphere of influence (erasing them), NOT discovery.

Historians, popping immodest economist bubbles since… forever.

I mean historians see through the fog of Chicago immediately because we trace actual intellectual genealogies rather than mythologized “founding fathers” trying to prove themselves weird ubermensch. The economist version is institutional hagiography, and false heroism, NOT history.

Philosophy (18th-19th c): Humans aren’t rational calculators.

Psychology (1950s-1970s): Empirical demonstration of systematic deviations from rationality.

Chicago (1980s+): “Ooh, look at what we found others talking about. Can we get someone around here to take credit for discovering them, and rebrand it anomalies?!”

The mythology machine creates a hero narrative where Thaler is the lone genius challenging orthodoxy, rather than what actually happened, to fit the Chicago mental model of radical white male individualism.

They can’t bring themselves to admit a story where knowledge emerges collectively and collaboratively across disciplines.

God forbid the ruling men of Chicago recognize that women and non-economists did foundational work. Women? Could you imagine, Chicago school dudes giving credit to women? Where’s the credit for Sarah Lichtenstein’s work on preference reversals that directly challenged rational choice? For Eleanor Rosch’s prototype theory that explained how people actually categorize? For developmental psychologists studying children’s economic reasoning? For Baruch Fischhoff’s work on hindsight bias and risk perception?

Progress happens through institutions slowly correcting errors, yet Chicago instead waits at the top of a tree for scraps like a vulture hoping to spin a narrative about being the apex predator. Imagine economists admitting it was fundamentally wrong and learning from outsiders?

The Thaler propaganda is to curate a lone genius, bravely challenging orthodoxy from within, founding a new field through individual brilliance. That’s the same bogus narrative structure as their whole economic theory – the heroic individual entrepreneur disrupting markets like a God above mere mortals. It’s circular and self-serving mythology.