Behavioral Economics

Recent developments in experimental economics have seriously questioned several assumptions of the hypothesis of rational behavior that underlies all of traditional economics. However, in many decision environments, individuals (and groups) often deviate from rational behavior in identifiable and predictable ways.

The primary goal of behavioral economics is, therefore, to incorporate these systematic biases into more accurate models of economic decision making. In this course we will examine a variety of topics in which behavioral economics has had a significant impact. In particular, we will begin with “anomalies” in the standard models.