Behavioral Economics

Autumn Semester 2024
Tuesday, 08:15 - 12:00, PER 21, Room C130
ECTS: 4.5
Office Hours: by appointment ( tom.rodriguez@unifr.ch)

Important Notice: The lecture will NOT take place in the first week of lectures. The first lecture will be on Tuesday, September 24^th.

Course description Moodle
Description:

This course covers key topics in Behavioral Economics. We start with an overview of common heuristics and biases in human behavior. Next, we explore reference-dependent preferences, such as how a silver medalist in an elimination tournament might feel less satisfied than a bronze medalist because their reference point was winning gold, while the bronze medalist’s goal was simply to make it onto the podium.
We then examine time preferences, illustrated by the tendency of people to buy gym memberships they rarely use, believing they’ll start exercising tomorrow but repeating the same procrastination each day.
The course also covers social preferences, challenging standard economic theories by exploring why people engage in pro-social behaviors, like donating blood, and how these other-regarding preferences can be modeled.
Finally, we discuss motivated beliefs, which is the notion that beliefs can hold intrinsic value similar to goods. An example is the finding that around 80% of drivers believe they are in the top 50%, suggesting that people derive satisfaction from believing they are skilled in certain areas, such as driving.
The course will be split in lectures as well as exercises to rehearse and practice the course content.

Prerequisites:

This course will be relatively formal and requires knowledge of microeconomics at least at the level of microeconomics 1 and 2 at the Bachelor level. Prior attendance of the Master course “advanced microeconomics” is highly recommended.

Required Readings:

The course will be based on selected book chapters and papers