Description:

Experimental Economics and Behavioral Economics have become major fields in Economics. Their methods and research output are contributing to topics in Economics and Public Policy, such as tax evasion and retirement savings. Moreover, behavioral insights are applied to improve decision-making of managers and performance of employees.

The course is subdivided into two parts:

• In the first part, experimental methods are introduced and the fundamentals of Experimental Economics are explained. Moreover, decision-making under certainty, risk, uncertainty and in a temporal context is analyzed. Common biases such as sunk cost fallacy are presented.
• In the second part, different topics including k-level reasoning, unethical behavior, reciprocity, and nudges are introduced. Seminal and current research papers are discussed to provide students with an overview of the key results.

The course also offers an in-class case study. Furthermore, a presentation by Deloitte shows how to apply Behavioral Economics and debiasing techniques for Managers.

You have to enroll yourself in the moodle course:

• The moodle course page can be found here.
• You can find the self enrollment key in the download section of this page.

Learning Targets:

After successful completion of this course, students will know standard tools of Experimental and Behavioral Economics and the underlying concepts and methods. Furthermore, students are introduced to several topics including risk, uncertainty, biases as well as nudges and will be able to talk about and apply key results to new situations. As part of that, students will be able to formulate research questions given a specific problem or situation, design an experimental approach for a specific problem and interpret results of an experimental paper to formulate management and policy recommendations.

Literature:

General books

• Angner, E., A course in Behavioral Economics, 2nd edition, 2016
• Friedman D., Cassar A., Economics lab, an intensive course in experimental economics, 2004
• Kagel, J. H., Roth, A. E., The Handbook of Experimental Economics, 1995
• Kagel, J. H., Roth, A. E., The Handbook of Experimental Economics Volume 2, 2015
• Moffatt, P. G., Experimetrics: Econometrics for Experimental Economics, 2015

Research papers (selection)

• Charness, G., Gneezy, U., Incentives to exercise, 2009
• Gneezy, U., Deception: The role of consequences, 2005
• Gneezy, U., Rustichini, A., Pay enough or don't pay at all, 2000
• Kocher, M. G., Schudy, S., Spantig, L., I lie? We lie! Why? Experimental evidence on a dishonesty shift in groups, 2018
• Sunstein, C. R., Nudging: a very short guide, 2014
• Thaler, R. H., Benartzi, S., Save more tomorrow™: Using behavioral economics to increase employee saving, 2004
• Tversky, A., Kahnemann, D., Extensional versus intuitive reasoning: The conjunction fallacy in probability judgment, 1983

Methods of Assessment:

Exam

Links:

You can find the dates of this course here in the LSF.

You can find the moodle course page here.

Materials:

• The course material is only available to a restricted user group. You are either not logged in or not in the usergroup.