Syllabus of the Course (2017-2018)
The Course is taught with Prof Giacomo Sillari
| Course Content |
•1. Introduction. Do human being behave rationally?
The basic ideas of Behavioral Economics
Decision Theory primer; Allais and Ellsberg paradoxes; Descriptive theories.
- Readings: Plous, ch 7 and 8 (required)
- Tversky and Kahneman “Rational Choice and the framing of decisions” The Journal of Business, vol.59, n.4 pp. s251-s278 (required)
•2. Cognition. Dual Process of reasoning; judgment and decision making.
- Required Readings: Kahneman, “Maps of Bounded Rationality” (Nobel Prize Lecture)
•3 Prospect Theory. Value function; Endowment Effect; Mental Accounting
- Required Readings: Plous, chs. 9,
- Shiller’ introduction to Prospect Theory
•4. Behavioral Law and Economics
- a. Required Readings:
- Jolls “Behavioral Law and Economics” 2004
•5. Heuristics and Bias (Law of small numbers. Anchoring. Availability. Conjunction Fallacy. Base-rate Fallacy. Regression to the mean)
- a. Required Readings: Plous, chs. 10-15
- b. Suggested Readings, Plous, chs. 17-18
•6. Overconfidence and Behavioral Finance (or an experiment to be agreed with the students )
- Required Readings:
- Barberis and Thaler: A Survey of Behavioral Finance, par. 1,2,3, pp. 1053-1075
Reference reading material
Tversky and Kahneman “Rational Choice and the framing of decisions” The Journal of Business, vol.59,n.4 pp. s251-s278
Download Tversky and Kahneman Rational Choice
Download Shiller’ talk on Prospect Theory
Download Expected Utility and Prospect Theory
Download The Dual Process Account of Reasoning
Daniel Kahneman, ” Maps of bounded rationality: A perspective on intuitive judgment and choice” , Nobel Prize Lecture, 20028-O
Download Kahnemann Nobel Lecture
Scott Plous, The Pshychology of Judgment and decision Making, McGraw-Hill ,1993:-|
Applications to : Political Choice, Finance, Law and Economics
George A. Quattrone and Amos Tversky “Contrasting rational and psychological analyses of political choice” , The American Political Science Review, Vol. 82, No. 3 (Sep., 1988), pp. 719-736 1988
Download Quattrone Tversky “Contrasting rational and psychological analyses of political choice”
Nicolas Barberis and Richard Thaler: “A Survey of Behavioral Finance”, Handbook of the Economics of Finance, Volume 1, Part B, pp. 1053-1075, 2003 – Elsevier;-)
Download Barberis Thaler Behavioral Finance
Christine Jolls, Behavioral Law and Economics Working Paper 12879 , NBER, 2007
Download Jolls Behavioral Law and Economics
Behind consumer decisions: Neuromarketing
Educational goals This course is intended to allow students to become familiar with the behavioral approach to economics and to political decision making . While this approach is based on the experimental data about human reasoning (provided by cognitive psychology) , students will be driven to test experimentally properties and assumptions on human decisions. Major goals will be that of enabling students to gain in-depth understanding of the major aspects of behavioral decision-making under uncertainty, and applications to economics, politics and finance, as well as to apply effectively the theories to ongoing debates, in order to raise their interest in carrying out research in this field.
Teaching method In-class lectures, computer-aided exercises and test sets, tutorials,
Assessment Method Computer-aided written and oral exam
Criteria for deciding on subject of final paper Exam grade, one-on-one colloquium
Preparatory courses Microeconomics , Elementary Statistics
Advanced Papers on Expected Utility
Records of some past examinations
Exams September 2013
Exams September 2014
Exams 2015-01
Exams 2015 May
Exams 2015 June
Exams Exam 2015 07 01
Exams November 09th 2015
Exams May 26 th 2016
Exams June 16 2016
Exams June 20th 2016
Exam September 2016
