ECN204 Introduction to Behavioral Economics

The course will provide an introduction to behavioral economics and will cover key topics such as bounded rationality, limited willpower and social preferences. It will be used examples of behavior from finance, entrepreneurship, environment, energy, development, marketing, and consumer policy

Learning outcomes

After the students have completed the course, they are expected to have acquired the following knowledge, skills and general competence:

Knowledge:

• have an understanding of how psychology often affects economic decisions
• have knowledge of methods used in behavioral economic research
• have knowledge of limited rationality and how, among other things, prospect theory, systems 1 and 2, availability, confirmation and commitment biases affect the assessments and choices people make in economic contexts
• have knowledge of social preferences and how, among other things, altruism, reciprocity, trust, jealousy affect the assessments and choices people make in economic contexts
• have knowledge of time preferences and assessments of the future, and how, among other things, procrastination and optimism affect the assessments and choices people make in economic contexts
• have knowledge of how people's behavior can be influenced through the design of the choices and be familiar with concepts such as choice architecture and nudging

Skill:

• recognize some of the most common behavioral economic mechanisms in different parts of the economy
• be able to assess how findings from behavioral economics can affect different types of financial assessments and decisions
• be able to understand and use key concepts related to behavioral economics
• be able to conduct simple behavioral studies

General competence:

• have basic knowledge of key topics in behavioral economics such as limited rationality, social preferences, and time preferences
• be able to critically assess economic contexts with regard to behavioral economics