Behavioral Economics

Catalog description

People often systematically deviate from predictions of standard models in economics. Behavioral economics is an emerging subfield of modern economics that incorporates insights from psychology and other social sciences into economics to improve realism of standard models. This course reviews some of the standard assumptions in economics and evidence on how human behavior systematically departs from these assumptions. Several well-known behavioral theories that explain such deviations and their implications will be discussed. Topics may include (but not limited to) context-dependence, prospect theory, loss aversion, present bias, self-control, reference-dependence, limited attention, biased beliefs, fairness, and biases in strategic reasoning.