A growing body of evidence in behavioral economics suggests that people's behavior differs in systematic and predictable ways from the model of rationality assumed by classical economists. However, empirical studies in behavioral economics have tended to focus on people of ordinary means, to the exclusion of people at economic extremes. Might people in poverty -- who have few resources and limited experience in economic decision-making -- display different behavioral patterns than others?

The field of behavioral public finance examines the relevance of various deviations from rationality in decisions relating to taxation and government expenditures. Research in this discipline includes assessment of the effectiveness of public policy in modifying self-damaging behavior and the efficacy of tax-collection procedures. With support from the Russell Sage Foundation, Joel Slemrod will convene a meeting at the University of Michigan to assess recent research in behavioral public finance.

Research on how people learn in economic environments has burgeoned in the last ten years. Scholars in the fields of game theory, neuroscience, and other disciplines have explored the mechanisms by which people acquire and integrate new information for use in markets and interpersonal behavior. However, there has been little collaboration between the different fields.

As part of an effort to encourage the development of behavioral economics in Europe, the University of Toulouse in France will hold its first Summer Institute on Economics and Psychology from June 16-24, 2005. The institute is designed based on the Summer Institute in Behavioral Economics run by the Behavioral Economics Roundtable every two years for U.S.-based researchers. The Toulouse Institute will include 30-35 participants, about half of whom will come from European universities and the other half from North America.

Behavioral economics has revolutionized economic studies by showing how, in reality, people do not act in the rigidly self-interested, incentive-driven way that conventional economic models suppose. But beyond models and theory, behavioral economics also has important practical applications.

Michael Fix, Vice President and Director of Studies at the Migration Policy Institute (MPI), will lead an effort to disseminate policy-relevant research on second-generation immigrants during the period of January 1, 2006 through December 31, 2006. MPI will commission a total of 14 articles on immigration, immigrant incorporation, and the second generation by RSF grant recipients and other researchers.