ABSTRACT
This chapter discusses ideas that form a part of the field of behavioural economics. Contrary to traditional economists, behavioural economists posit that humans are not unboundedly (or infinitely) rational and thus are prone to take irrational decisions which affect outcomes. The inherent human tendency to be “boundedly” rational presents itself as an important behavioural component of school systems. Cognitive biases represent one manifestation of such bounded rationality. In the discussion presented within this chapter, the role of cognitive biases in influencing school systems and eventual outcomes is analyzed to explain how bounded rationality and cognitive biases affect micro and macro decision-making in the context of school systems. A wide range of cognitive biases are discussed, with examples, anecdotes and real-life cases from schools.
