Economist Richard Thaler is photographed on June 1, 2016 in London, England. Photo: Getty Images

Stockholm, Sweden (BBN) – US economist Richard Thaler, one of the founding fathers of behavioural economics, has won this year’s Nobel Prize for Economics.

Prof Thaler, of the University of Chicago Booth, co-wrote the global best seller Nudge, which looked at how people make bad or irrational choices, reports BBC.

Judges said he had demonstrated how “nudging” – a term he coined – may help people exercise better self-control.
He will receive 9 million Swedish krona (£850,000) from the committee.
“I will try to spend it as irrationally as possible!” the 72 year-old economist said.

Prof Thaler’s work led to the UK setting up a nudge unit under former prime minister David Cameron. It was launched in 2010 to find innovative ways of changing public behaviour.

One of the Nobel prize judges, Per Stroemberg, said Prof Thaler’s work had explored how human psychology shaped economic decisions.
“Richard Thaler’s findings have inspired many other researchers coming in his footsteps and it has paved the way for a new field in economics which we call behavioural economics,” Mr Stroemberg said.
The panel said Prof Thaler’s insights helped people to recognise marketing tricks and avoid bad economic decisions.
In particular, his work looked at how to “nudge” people into doing more long-term planning, such as saving for a pension.