Homo Economicus is the mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume. It sits in the Cognition dimension (COG) of the Human Behavior Taxonomy™ as element HBT-COG-0370, within the Economics family. The core principle: the mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume. In incentive terms, it matters because it changes the payoff people perceive before they choose — which means it can be designed for, or exploited.
Scientific Definition
The mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume.
Plain-English Definition
The mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume.
Feynman Explanation
Cited often. Met never.
Core Principle
The mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume.
Mechanisms
Pending editorial review.
The mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume.
Pending editorial review.
Pending editorial review.
Pending editorial review.
Pending editorial review.
If your strategy only works for homo economicus, it does not work.
Inputs (Triggers)
Pending editorial review.
Outputs (Behaviors)
Pending editorial review.
Behavioral Signature
Cited often. Met never.
Examples
- The textbook chooser who never anchors, never loves, never gets tired, never regrets.
- If your strategy only works for homo economicus, it does not work.
Pending editorial review.
Original analysis from The Incentives Lab — how this element behaves inside real payoff structures.
Why this element matters to incentive design
When this element shows up in a diagnostic, the instinct is to train people out of it. Training rarely moves it. The mechanism underneath it is straightforward: the mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume. You can recognize it in the field by its signature: cited often. Met never. Every element in the Cognition dimension changes the perceived payoff of an action before the action happens, which is exactly where incentive design has leverage.
How it gets exploited
Left undesigned, if your strategy only works for homo economicus, it does not work. It is amplified whenever if your strategy only works for homo economicus, it does not work. Inside organizations that shows up as if your strategy only works for homo economicus, it does not work. The pattern is the same one Goodhart's Law describes: the measurable proxy attracts the effort, and the purpose behind it quietly loses funding.
How the Lab designs around it
The redesign move is to design for the human in the chair, not the agent in the equation. Design against it the way you would design against a known failure mode — assume it will appear, and price the exploit before someone finds it.
Famous Experiments
Pending editorial review.
Design Principles
- Design for the human in the chair, not the agent in the equation.
Measurement Approaches
Pending editorial review.
Evidence
Pending editorial review.
Pending editorial review.
The Perverse Incentive Lens™
How this behavior is exploited — and how to redesign around it.
- Design for the human in the chair, not the agent in the equation.
Pending editorial review.
Pending editorial review.
Interactive Mini Network
Click any neighbor to re-center the graph and follow the threads of connection.
Knowledge Graph Neighbors
Auto-linked to the rest of the Human Behavior Taxonomy by family, domain, dimension, and shared keywords.
Exploiting price differences between markets for risk-free profit.
The study of how real humans actually decide — bounded, social, emotional, and inconsistent.
With clear property rights and low transaction costs, parties negotiate to efficient outcomes.
Specialize in what you give up the least to do.
Complements raise each other's value; substitutes lower it.
Fixed costs don't scale with output; variable costs do.
Innovation destroys old industries and creates new ones.
Each additional unit produces less marginal benefit.
A long-run planner self in conflict with a short-run impulsive self.
Owning something raises its valuation — sellers want more to give it up than buyers will pay to acquire.
Bad money drives out good when both are legally equivalent.
One party has more or better information than another.
Where Homo Economicus is cited in the corpus
Essays, field guides, and diagnostics from The Incentives Lab that apply this element.
- EssayGoodhart's Law in the Real World
How measurable proxies capture judgment.
- EssayThe Perverse Incentives Hiding in Your KPIs
Cognitive shortcuts turned into scorecards.
- EssayAI Agents Inherit Your Incentives
How this element propagates into automated systems.
- CourseIncentives 101
The free ten-part primer on reading a payoff structure.
- ReferenceThe Periodic Table of Human Behavior
The full 1,267-element map this page belongs to.
Questions about Homo Economicus
- What is Homo Economicus?
- Homo Economicus is the mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume. It sits in the Cognition dimension (COG) of the Human Behavior Taxonomy™ as element HBT-COG-0370, within the Economics family. The core principle: the mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume. In incentive terms, it matters because it changes the payoff people perceive before they choose — which means it can be designed for, or exploited.
- What is an example of Homo Economicus?
- If your strategy only works for homo economicus, it does not work. The Incentives Lab catalogs everyday, organizational, and historical instances of this element on its Human Behavior Taxonomy™ page (HBT-COG-0370).
- How is Homo Economicus exploited?
- If your strategy only works for homo economicus, it does not work.
- How do you design around Homo Economicus?
- Design for the human in the chair, not the agent in the equation.
- Which behavioral dimension does Homo Economicus belong to?
- Homo Economicus is classified in the Cognition dimension (COG) of the Human Behavior Taxonomy™, family "Economics", class "Mental Model". Its permanent identifier is HBT-COG-0370 and its evidence grade is B.