|Type of paper:||Essay|
|Categories:||Sales Covid 19 Customer service Behavior change|
Richard H Thaler's Nobel Prize lecture brings out three underlying themes in consumer behavior; nudge mental accounting and choice architecture. The nudge has libertarian paternalism and the choice architecture as its critical components. Libertarian paternalism is whereby consumers are not forced into anything, but rather their consumption behavior is based on their willpower. The saving decision is crucial for every individual during this period.
The choice of architecture is the environment in which people make decisions. What is the economic environment like not only in New York but also globally? We are all aware of the devastating economic impact in this corona era. It is therefore evident that there are drastic changes that have come along with the pandemic and thus calling for a new normal in terms of our consumer behavior. This new normal may stick around even post the crisis. The aspect of mental accounting brings about the fact that consumers are loss-averse creatures. The fear of losing what they already have is greater than the desire of getting something new. It is with no doubt that most New Yorkers are and will be extremely concerned with protecting their health, and financial status and keeping their families away from the risks associated with the pandemic.
The most prevalent change in economic behavior is the shift to online shopping. Most malls and retail shops are empty. Most people have indicated to be making purchases online from the most primary needs to even the expensive stuff. Malls and other retailers and shops are almost empty as people keep off the physical stores to reduce the risks of contracting the disease. Bars and restaurants have become less popular as more people now prefer to take always and drive-through. Most people are cooking from their homes as well.
The spending levels are significantly down. With the majority of the people being pessimist about the economic state shortly, most have resulted in cutting costs. The save and stockpile consumer category has emerged as the most prevalent in this crisis, according to EY Global. Most families are spending on the most basic needs, with the majority spending on groceries. However, among the New Yorkers, there are those in the stay calm and carry on that has not seemed to change their spending habits in this pandemic
Brands have also become less significant to the consumers as they are going with what is available to them and are more in support of the local brands.
As the state plans to open on 8th June, it believes that most people will adopt the new normal even post the pandemic crises. Online shopping is going to be prevalent. Thus, most retailers will not doubt but to put measures to serve new customer behavior. Outdoor entertainment, community gatherings, and eating in bars and restaurants is likely to reduce as people adapt to the new normal significantly. It is less likely that people will spend money on traveling outside the city for holidays as they will be still on cost-saving until the economic situation stabilizes around the world. For a city that is believed never to sleep, the people will have the will to revive it to the hub of business that is well known for a while still integrating the 'new normal'.
Baker, S. R., Farrokhnia, R. A., Meyer, S., Pagel, M., & Yannelis, C. (2020). How does household spending respond to an epidemic? Consumption during the 2020 COVID-19 pandemic (No. w26949). National Bureau of Economic Research.
Goodell, J. W. (2020). COVID-19 and finance: Agendas for future research. Finance Research Letters, 101512.
Van Bavel, J. J., Baicker, K., Boggio, P. S., Capraro, V., Cichocka, A., Cikara, M., ... & Drury, J. (2020). Using social and behavioral science to support COVID-19 pandemic response. Nature Human Behaviour, 1-12.
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Where Behavioral Economics Is Headed Post-New York Covid -19 Lockdown? Essay Example. (2023, Aug 20). Retrieved from https://speedypaper.com/essays/where-behavioral-economics-is-headed-post-new-york-covid-19-lockdown
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