rganizational behavior (OB) is a field of study that focuses on understanding, explaining, and improving the behavior of individuals and groups within organizations. It is concerned with how people behave in work settings, how organizations affect their behavior, and how individuals and groups interact with each other and with the larger organizational context. Organizational behavior draws from a variety of disciplines, including psychology, sociology, anthropology, and economics. It encompasses topics such as motivation, leadership, communication, group dynamics, decision-making, organizational culture, and organizational change. The goal of organizational behavior research is to develop a better understanding of why people behave the way they do in work settings and to identify ways to improve organizational performance and employee well-being. This knowledge can be applied in a variety of settings, including businesses, government agencies, and non-profit organizations.

1. Behavioral Decision Theory
And Behavioral Economics
1.Behavioral decision theory is a descriptive Psychological theory of human judgement
Decision making and Behavior that can be applied to political science.
Behavioral decision theory is closely related to Behavioral Economics and Behavioral Finance.
2.Behavioral economics is the study of psychology as it relates to the economics decision making
processes of individuals and institutions.

2. Behavioral Decision Theory Finding
• Consumers are more likely to choose an alternative (a home bread maker) after a relatively inferior
option ( a slightly better but significant more expensive home bread maker) is added to the available
choice set.
• The choices consumers make influence their assessment of their own tastes and preferences.
• Consumers who think about the possibility that their purchase decisions will turn out to be wrong are
more likely to choose better known brands.
• When faced with a simple but important decision,Consumer can actually make things more
complicated than they should.
• Consumer often overestimate their future consumption ,especially if there is limited availability.
• Consumers predicitions of their future tastes are not accurate- they do not really know how they will
feel after consuming the same flavour of yogurt or ice cream several times.
• In anticipating future consumption opportunities ,consumer often assume they will want or need more
variety than they actually do.

3. Issues in the field of Decision theory
1.Decision Heuristic
2. Decision Framing

4. Decision Heuristics
Heuristics is the process by which humans use mental short cuts to arrive at decision. Heuristics are simple strategies that
humans,animals,organizations and even machines use to quickly form judgments ,make decision and find solution to complex problems.
There are 3 types of Heuristics
1. Availability Heuristics – An Availability heuristic is a mental shortcut that relies on immediate examples that come to a given person
mind when evaluating a specific topic ,concept,method or decision.As follows, people tend to use a readily available fact to base their
beliefs on a comparably distant concept.The availability heuristics works by prioritizing infrequent events based on recency and
vividness. For ex- Plane crashes can make people afraid of flying.However,the likelihood of dying in a car accident is far higher than
dying as a passanger on an airplane.
2. Representativeness Heuristics – Is a mental shortcut that we can use when estimating probabilities.When we are trying to assess how
likely a certain event is ,we often make our decision by assessing how similar it is to an existing mental prototype.For ex thinking that
because someone wearing a suit and tie and carrying a briefcase, that they must be a lawyer,because they look like the stereotype of a
lawyer.
3. Anchoring and Adjustment heuristic- It Describes cases in which a person uses a specific target number or value as a starting point
,known as an anchor and subsequently adjusts that information until an acceptable value is reached over time. For ex If you first see a
t-shirt that costs Rs 1200- then see a second one that costs Rs 100 you are prone to see second one.

5. Decision Framing
Decision Framing is the manner in which choices are presented to and seen by a
decision maker. Framing a decision allows for a full examination of all the issues
options and available information that can contribute to making a good decision.
A Rs 10,000 cell phone may not seem that expensive in the context of a set Rs
8,000 phone but may seem very expensive if other phone cost Rs 3000 .Framing
effects are pervasive and can be powerfull.