BEHAVIORAL ECONOMICS IN THE CLASSROOM: TEACHING STUDENTS TO ADDRESS COGNITIVE BIASES IN FINANCIAL DECISION-MAKING

Abstract

Cognitive biases significantly influence financial decision-making, often leading to suboptimal outcomes in personal and professional contexts. This study evaluates the effectiveness of incorporating behavioral economics principles into the classroom to teach secondary school students in Enugu State, Nigeria, how to recognize and mitigate cognitive biases in financial decision-making. A 10-week intervention was implemented with 180 students across two schools, integrating interactive lessons on biases such as anchoring, loss aversion, and overconfidence, alongside practical exercises like budgeting simulations and investment scenarios. A quasi-experimental design compared the intervention group to a control group receiving standard Economics Education. Quantitative results revealed a 41% improvement in bias identification accuracy and a 35% enhancement in rational decision-making skills among the intervention group. Qualitative feedback from students and Educators indicated increased confidence in financial planning and heightened awareness of psychological influences. Challenges included limited access to digital tools for simulations and the need for teacher training in Behavioral Economics. This study highlights the potential of Behavioral Economics Education to empower students with critical financial literacy skills, advocating for its integration into curricula while addressing resource and training barriers.