BEHAVIOURAL ECONOMICS - 2020/1

Module Overview

This module introduces students to the field of behavioural economics which incorporates psychological evidence into economics. The canonical approach in economics explains market outcomes and economic decision-making using theoretical models which usually assume that people are fully rational. Behavioural economics, on the other hand, studies how people actually make decisions, by considering a number of real life decision making situations where some standard rationality assumptions on preferences do not hold. This module will present these departures by using empirical and experimental findings, as well as formalising theoretically their common pattern.

Module provider

Economics

Module Leader

BOZBAY Irem (Economics)

Number of Credits: 15

ECTS Credits: 7.5

Framework: FHEQ Level 6

JACs code: L110

Module cap (Maximum number of students): N/A

Module Availability

Semester 1

Prerequisites / Co-requisites

None

Module content

Indicative content includes:

• Rationality and Expected utility theory


• Prospect theory and Reference-dependent preferences


• Hyperbolic discounting


• Other regarding preferences

Assessment pattern

Alternative Assessment

N/A

Assessment Strategy

The assessment strategy is designed to provide students with the opportunity to demonstrate

• Knowledge of the main empirical and experimental findings in behavioural economics;


• Ability to apply the knowledge of core concepts from behavioural economics to new problems;


• Ability to apply technical skills introduced in the module;

Thus, the summative assessment for this module consists of:

• A class test (worth 30% of the overall mark)


• A final exam (worth 70% of the overall mark)

Formative assessment and Feedback

Students receive verbal feedback during lectures (in which questions and real-world examples in economics are both attempted and discussed). Feedback to assessments will be given during lectures and students will be provided feedback documents which summarise commonly made mistakes in the assessments. For the course work and the exam, sample questions are made available for students so that they can familiarise themselves with the setup. 

Module aims

• provide a broad overview of important results from behavioural economics;
• combine and compare canonical topics in economics (such as expected utility theory, rationality of preferences) with observed psychological regularities;
• formalise departures from the assumptions made in the canonical economic models by examining empirical and experimental evidence.
• develop an understanding of how people make decisions.

Learning outcomes

Methods of Teaching / Learning

The learning and teaching strategy is designed to:

• enhance understanding and intuition of behavioural economics;


• enhance ability to identify and examine evidence of departure from the assumptions made in the canonical economic model;


• help students understand how these departures can be formalised theoretically and be tested empirically.


• enhance skills in applying mathematical methods to behavioural economics


• enhance reasoning about decision making in daily life.

The learning and teaching methods include:

• 2-hour lecture per week x 11 weeks

Indicated Lecture Hours (which may also include seminars, tutorials, workshops and other contact time) are approximate and may include in-class tests where one or more of these are an assessment on the module. In-class tests are scheduled/organised separately to taught content and will be published on to student personal timetables, where they apply to taken modules, as soon as they are finalised by central administration. This will usually be after the initial publication of the teaching timetable for the relevant semester.

Reading list

https://readinglists.surrey.ac.uk
Upon accessing the reading list, please search for the module using the module code: ECO3052

Programmes this module appears in

Please note that the information detailed within this record is accurate at the time of publishing and may be subject to change. This record contains information for the most up to date version of the programme / module for the 2020/1 academic year.