Final answer:
Economic games studies have been criticized for how they handle the concept of mental accounting, where people subjectively value money based on its context, which opposes the mainstream economic view of money's fungibility. Behavioral economists show that the subjective value of money can affect people's spending decisions, suggesting that the same amount of money may be treated differently depending on how it was obtained.
Step-by-step explanation:
Economic game studies, which are part of behavioral economics, have raised concerns regarding their external validity. One key area of criticism is how these studies handle the concept of mental accounting, which refers to the subjective value people attribute to money in different contexts, challenging the notion of money's fungibility. Despite mainstream economists viewing dollars as fungible and having equal value regardless of the situation, studies suggest that people often consider money differently based on its source or intended use.
For example, an individual might perceive $25 found on the street differently from $25 earned after hours of work, often treating found money as 'mad money' and spending it with less consideration for value. This is contrasted by mainstream economists who assert that, for a rational actor, '$10 is $10', and the context of acquiring should not affect its value. Behavioral economists, however, have identified that people think in terms of relative gains and losses by comparing outcomes to a reference point, which could mean treating the same amount of money in different scenarios with different levels of practical concern.