The Behavioural Turn in Housing Economics: Reflections on the Theoretical and Operational Challenges

Abstract

This paper starts with an assumption that mainstream economics has limitations and that a behaviourally rich inter-disciplinary research programme can strengthen the field of housing studies by addressing some of these weaknesses. We note, however, that the heterogeneity of behavioural studies and, in particular, the bifurcation between ’old’ and ’new’ behavioural economics presents significant conceptual and operational challenges. We note, for instance, that the diversity within the existing literature might be viewed as evidence of a lack of coherence and could serve to undermine the case for a behavioural turn. To address this, we urge behavioural researchers to take great care in specifying their conceptual models and in demonstrating the rigour and robustness of their applied research methods. We also add our support to the call made in the focus articles for the need energise inter-disciplinary working in behavioural studies and, in particular, stress the need to work on resolving some of the tensions that might arise from attempts to blend the insights and approaches associated with different disciplinary perspectives.

Key Words:

• Housing economics
• Behavioural economics
• Pragmatism

Notes

1. The invitation to comment on these papers came at a point when our mutual interest in the application of heterodox economic theories to the analysis of housing markets had been reawakened by an opportunity to undertake a scoping study for the Department of Communities and Local Government that sought to explore the potential benefits from applying a behavioural economics approach to the analysis of attitudes, perceptions and expectations of actors operating in the housing sector. Several of the points made in this article are developed in greater detail in the outputs from this project (see Ferrari, Henneberry, Leahy Laughlin, McMaster, Tait & Watkins 2010). We are grateful to Ed Ferrari, John Henneberry, Danielle Leahy Laughlin and Malcolm Tait for their contribution to that project and, by extension, to the points made in this article.