Final answer:
The statement attributing to Mancur Olson that individuals will be more prone to act when the cost exceeds the benefit is false; it's actually the opposite. Olson's principle is related to collective action problems and behavioral economics, wherein people weigh costs and benefits but are often influenced by loss aversion when making decisions.
Step-by-step explanation:
Mancur Olson pointed out that individuals tend to refrain from action when they perceive that the costs outweigh the benefits. This statement is false because, according to Olson, individuals will be more prone to act when they perceive the benefit to be higher than the cost, not the other way around. Olson explored this in his work related to collective action problems, where individuals may not take action if they believe their contribution has a marginal impact or if the effort required does not justify the potential benefits.
This concept has similarities with the principle of loss aversion in behavioral economics, coined by Daniel Kahneman and Amos Tversky, suggesting individuals experience losses more strongly than gains. Understanding this can help explain why people might overreact to stock market losses compared to gains.
In a rational decision-making process, a consumer, like the hypothetical Alphonso considering bus tickets and burgers, will continue to purchase goods as long as the marginal utility derived from the good exceeds the opportunity cost. This approach underpins much of behavioral economics and consumer behavior analysis.