In social sciences and particularly in economics understanding the human decision-making process is crucial. In the history of economics, there are several normative and descriptive theories that try to explain an individual's economic decisions. However, there isn't a unique theory that provides a complete view of the human decision-making process. Even though many ''smart'' models in economic theory aim to interpret and predict decisions, many real-world decisions are beyond the scope of those models. The main evidence of the shortcomings of economic theories is that human mental and analytical abilities are limited and so people's decisions aren't always rational, while economic theory assumes that the decision-makers are entirely consistent in their choices. Unfortunately, it is not possible to make people unmistaken and cognitively unbiased. Hence, it will be naive to expect that people will ever be able to synchronize their decisions with economic theory. The realistic way to fill the gap between reality and the economic models is to pay more attention to real-world processes and choices
In the mid 20th century, some economists started to build alternative, real-world economic theories. Those theories were more realistic and based on assumptions that are much closer to the individual's behaviors. Unlike conventional economics, which is mainly based on the rationality assumption, in other words, coherency and consistency, the alternative theories are more flexible and don't restrict the individual's decisions that much. They have one prime goal -- to represent real-world processes by being closer to actual human decisions as much as possible.
This primary objective was the basis in formulating a new branch in economics – behavioral economics – which has been rapidly growing in the last few decades. Although behavioral economics offers useful models that are much closer to reality than classical economics, traditional economics still dominates. There are three main reasons for this. The fundamental purpose is that human decisions are complex and inconsistent, and they include many factors that make them extremely difficult to model mathematically. The second is that conventional economics has already been `installed' in the economy and both time and effort are needed to enact change. And the third reason, which is behavioral itself, is that even the economists favor the status quo.