Behavioral Economics

Behavioral economics uses empirical insights from psychology and other fields (such as sociology or neuroscience) in economic analysis. Conventionally, economics assumes that people are "economically rational": they make logically consistent choices in their best self-interest. Of course, sometimes people don't behave that way. Behavioral economics broadens the reach of economic analysis to situations in which people unselfishly contribute to the common good (like giving to the Red Cross), regret a choice (such as eating a candy bar instead of an apple), or make errors in judgement (for example, assign too much weight to highly unlikely events such as a lightning strike). Economic policies can look very different when people exhibit these kinds of behavior.

Language of instruction is English.

None

After completing the course, the student should have the following overall learning outcomes defined in terms of knowledge, skills and general competence:

Knowledge

The student has insight into

• central theories and concepts in behavioral economics, such as heuristics, biases, prospect theory, time preferences, and social preferences
• how behavioral insights can explain deviations from standard economic predictions in individual and group decision-making
• how experiments and other empirical methods are used to test behavioral hypotheses and guide policy or business decisions

Skills

The student can

• apply behavioral insights to analyze economic and organizational decision-making.
• interpret and evaluate evidence from behavioral and experimental studies.
• discuss how behavioral tools (for example, choice architecture, incentives, and feedback mechanisms) can promote better decisions and sustainable outcomes.

General competence

The student is more able to

• use both standard economic frameworks and insights from behavioral studies to interpret and analyze real-world behavior.
• critically reflect on the application, implications, and limitations of both frameworks in understanding markets, organizations, and public policy.
• communicate economic and behavioral reasoning and evidence.

Lectures with active student participation.

The teaching takes place with in-person attendance on campus.

The following coursework requirements must have been approved in order for the student to take the exam:

• Coursework 1: Written assignment. Group or individual work. Maximum 10 pages.
• Coursework 2: Oral assignment. Group work. 20 min presentation + 5 min feedback

The group work will be carried out in groups consisting 2-5 students, depending of participating students in the course.

The coursework is part of the active learning experience for the students and helps prepare students for the final exam. It also serves as useful feedback about the effectiveness of the lecturer's teaching.

All required coursework must be completed and approved by the given deadline in order for the student to take the exam.

If the written coursework requirement is not approved, the student will be given one opportunity to submit an improved version by the given deadline.

If the oral coursework requirement is not approved (or the student does not participate in the planned presentation), the student will be given one opportunity to give a new presentation by the given deadline.

The exam in the course is a supervised exam of 4 hours.

The following aids are permitted:

• One dictionary (Native language-English/English-native language or English-English).
• Digital calculator will be made available in the exam system. It is not permitted to bring your own calculator.

Grade scale A-F

The exam papers are assessed by one internal and one external examiner.

At least 25% of the exam papers will be assessed by two examiners. The grades awarded for the papers assessed by two examiners form the basis for determining the level for all the exam papers.

· Åshild Auglænd Johnsen

· Eleonora Freddi