It attempts to use ideas and experiments from psychology to explain the behaviour of consumers and firms in economic situations.
In my opinion the book "Predictably Irrational" - about this - is the best economics book published in last five years, and very funny as well. ( http://www.amazon.co.uk/Predictably-Irrational-Hidden-Forces-Decisions/dp/0007256531/ref=sr_1_1?ie=UTF8&s=books&qid=1270245070&sr=8-1 )
Anycase, here is an article using this approach to argue that events like the credit crunch happen every ten years, and that human psychology ensures that people do not learn from the past.
(Read the rest here.)
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