ECN304 Behavioral and Experimental Economics

Credits (ECTS):10

Campus / Online:Taught campus Ås

Teaching language:Engelsk

Course frequency:Annually

Nominal workload:250 hours

Teaching and exam period:This course starts in Autumn parallel. This course has teaching/evaluation in Autumn parallel.

About this course

The course gives Insights into advanced theories in behavioral economics with special focus on how social and economic preferences influence people's behavior and economic decisions and how they relate to risk and uncertainty. Experimental methods are central for the identification of causal relationships as well as for measuring unobservable variables such as social and economic preferences.

Topics in behavioral economics include: rational vs. irrational behavior, uncertainty and expected utility, prospect theory, time preferences and discounting, risk preferences and responses to risk, social preferences, trust, endowment effects.

Topics in experimental design include: basic design issues, randomization and causal identification, implementation of laboratory experiments, field experiments, internal and external validity.

Learning outcome

The students learn to distinguish rational from irrational behavior based on expected utility theory and discounted utility maximization for intertemporal choice.

Students learn about systematic deviations from expected utility theory and how rank dependent utility and cumulative prospect theory may predict such behavior.

Students learn about the advantages and limitations of laboratory and field experiments (internal and external validity).

Students learn a set of standard experimental games and methods and what has been learnt from these: dictator game, Ultimatum game, trust game, public goods game, methods to elicit risk preferences, methods to elicit time preferences.

Students are given one exercise where they will design their own experiment which they will present in class.

  • Lectures and discussions in class, exercises in groups, writing of individual submissions. There are five compulsory exercises in the course including one on social preferences, one on risk and risk preferences, one of time preferences, one where the students select a relevant paper to present in class, and the fifth exercise is where students design their own experiment and present it in class.
  • The course is given digitally. Students will have access to detailed information about the course with access to the relevant literature through Canvas. Supervision by the teacher during exercises.
  • ECN201 Econometrics, STAT100 Statistics.
  • Final written in-class examination (3,5 hours) accounts for 100% of the grade.
  • External examiner will control the quality of syllabus, questions for the final examination, and principles for the assessment of the examination answers.
  • Five compulsory exercises must have been submitted and approved (quality check) before a candidate can take the exam. Exercises are valid until the next time the course is offered and for re-examination.

    Exercise 1: Social preferences. The students are subjects in the exercise to get a feel for how that is. They also learn about the findings from such experiments.

    Exercise 2. Risk preferences. The students are given an experimental protocol (Multiple Choice List Approach) for interviewing respondents and are given the task to interview 5 persons each with this protocol and then asked to design a way to standardize such interviews.

    Exercise 3. Time preferences. The students are given a data set collected by other students in the course in the past based on an experimental protocol to elicit time preferences. They shall organize the data and do econometric analysis of the experimental data to test three central hypotheses about time preferences anomalies.

    Exercise 4. The students select a course-relevant paper that they present in class.

    Exercise 5. Each student designs her/his own experiment and presents in class. They vote on the best experiment/presentation.

  • The course is given jointly as a digital course to African students, at LUANAR, Malawi. The course is in English. Incoming students can contact student advisors at the School of Economics and Business (studieveileder-hh@nmbu.no) for admission to the course.
  • The course is given as a digital course. Lectures 2 hours per week, exercises 0-2 hours per week
  • Letter grades
  • Minimum requirements for entrance to higher education in Norway (generell studiekompetanse).