BEHAVIOURAL ECONOMICS: A STUDY ON HOW WE REALLY ACT

Behavioral Economics is the scientific study of decision making, and of the related topics of valuation, exchange, and interpersonal interactions. Drawing on methods from psychology, sociology, neurology, and economics, this course illuminates one of the most deeply fundamental activities of human existence: the decision process. Behavioral Economics couples scientific research on psychology with economic theory to better understand what motivates peoples' decision making. The course examines topics such as: how does emotion rather than cognition determine decisions, irrational patterns of how people think about things, how do expectations shape perceptions, group decision making, institutional cooperation, economic and psychological analyses of dishonesty, how trust and cooperation are formed and what the brighter and darker sides of them are, how do incomplete contracts affect employees' work motivation, how people really behave in their everyday life, what the physiology of joint action is, what are the biological, hormonal, and neuronal bases of prosocial behavior, how does pain and arousal affects our decision making, why do we do weird stuff, and how social incentives motivate labor. The course also explores intriguing questions regarding human behavior as: Why do people donate differently in similar cultures? When faced with the same medical condition, why do doctors choose objectively better treatment for their patients than they do for themselves? Why a third option when choosing a product does make a big difference, when actually nothing has changed? Why pain is sometimes good for you? This highly interdisciplinary course is relevant to students with interests in management, behavioral psychology, entrepreneurship, marketing, anthropology, sociology, and even biology. This course also surveys research which incorporates psychological evidence into economics. The seminar has two facets. First, it gives students a broad overview of important results from various behavioral sciences (e.g., behavioral decision research, social and cognitive psychology, consumer research) that clarify how people really make decisions. Second, it provides students with practical advice about applying these findings to their research interests and their life.