Economics has paid little attention to the psychology of economic behaviour, leading to somewhat simplistic assumptions about human nature. The psychological aspects have typically been reduced to standard utility theory, based on a narrow conception of rationality and self-interest maximization. The studies in this volume, some focused on analytical models and methodology, others on laboratory and field experiments, challenge standard economic assumptions - in particular the assumption of Homo economicus - and provide novel and complex understandings of human motivation and economic decision-making. They cover a wide range of aspects, including the role of self confidence, learning, altruism, inequality aversion, money illusion and notions of justice and fairness in explaining economic behaviour in a variety of contexts - the family, the community and the workplace.On the one hand, the contributors provide extensions, developments, and new proofs of psychological ideas by using the tools of economics (game theory, principal-agent theory, inter-temporal maximization, and so on). On the other hand, these studies have the potential for influencing other disciplines, thus progressively broadening the scope of inter-disciplinary exchange. Some even view this ongoing process of innovation in economic theory as a paradigmatic shift. With a pioneering introduction by the book's two editors, this volume brings together exciting new contributions to a field that is rapidly growing in influence and reach.