BEHAVIOURAL ECONOMICS - 2026/7

Module Overview

This module introduces students to the field of behavioural economics which incorporates psychological evidence into economics. The standard 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, seeks to increase the explanatory power of traditional models by considering a number of real life decision making situations where some standard rationality assumptions on preferences do not hold. This module builds mainly on the individual decision making models taught in microeconomics and financial economics modules in year 1 and year 2, identifies departures from these classical models, and use them as an inspiration to create alternative theories of decision making.

Module provider

Economics

Module Leader

BOZBAY Irem (Economics)

Number of Credits: 15

ECTS Credits: 7.5

Framework: FHEQ Level 6

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

Module Availability

Semester 1

Prerequisites / Co-requisites

None

Module content

Indicative content includes rationality, decision making under risk and uncertainty, heuristics and biases in risk judgments, prospect theory, intertemporal decision making and other-regarding preferences.

Assessment pattern

Alternative Assessment

If circumstances do not allow for completion of the Group Presentation and/or Group Project in their original format, alternative assessments may be implemented at the discretion of the module convenor. Group presentation can be substituted with individual presentation or recorded video. Group project can be substituted with individual project. 

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 via one class test. The class test is based on the theory and key papers studied in the main module content, ensuring that students are assessed on the core theories taught in the module.
• Ability to design experimental approaches to investigate behavioural economic questions via a group presentation. The presentation requires students to collaboratively develop and present an experimental design, demonstrating their understanding of methodological principles and their ability to translate theoretical insights into testable frameworks.
• Ability to apply behavioural economics concepts and critically evaluate their use in practical contexts via a group project. The project builds on the experimental design developed in the presentation and requires students to produce a written report outlining the design and its potential applications, thereby assessing their capacity to integrate theory, methodology, and real-world relevance.

Thus, the summative assessment for this module consists of:

1. Class test (addresses learning outcomes 1, 2, 3, and 5)
2. Group presentation (addresses learning outcomes 1, 2, 3, 4, and 5)
3. Group project (addresses learning outcomes 1, 2, 3, 4, and 5)

Formative assessment and Feedback

Students receive verbal feedback during lectures (in which questions related to real-world examples in economics are both attempted and discussed). Students are provided with tasks on SurreyLearn relating to the material, which they work on independently or in groups and can then post on the discussion forum where they receive feedback. These are also discussed in lectures. Students can also attend the module leader¿s regular weekly office hours, or meet by appointment. Students will be provided with general feedback summarising commonly made mistakes after the class test.

Students receive immediate verbal feedback during group presentations, allowing them to reflect on their experimental design and approach in real time and to incorporate this feedback into their subsequent project work. 

Guidance on the group presentation and project will be provided in advance. Final feedback on the group project will highlight key strengths and areas for improvement, supporting students¿ future academic development.

Module aims

• To provide a broad overview of important results from behavioural economics.
• To combine and compare standard topics in economics (such as expected utility theory, rationality of preferences) with observed psychological regularities and formalise departures from the assumptions made in standard models by examining empirical and experimental evidence.
• To develop an understanding of how people make decisions.
• To develop students¿ ability to design, communicate, and critically evaluate experimental approaches to behavioural economic questions, including their potential applications.

Learning outcomes

Methods of Teaching / Learning

The learning and teaching strategy is designed to ensure that students achieve the module¿s learning outcomes:

Lectures are designed to enhance ability to identify and examine empirical and experimental evidence of departure from the assumptions made in standard economic models; and help students understand how these departures can be formalised theoretically.

Weekly guided learning activities include (but are not limited to) self-tests, case studies, problem sets, experiments, and surveys that link students¿ own decision making processes to behavioural models. These activities are designed to enhance skills in applying mathematical methods to behavioural economics and to practical individual decision making in general, as well as to encourage independent research.

Students will also have the opportunity to participate in informal in-class or online experiments, which are designed to illustrate key behavioural concepts and experimental methods in practice, and to support the development of their own experimental design skills.

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

Other information

Surrey's Curriculum Framework is committed to developing graduates with strengths in Employability, Digital Capabilities, Global and Cultural Capabilities, Sustainability and Resourcefulness and Resilience. This module is designed to allow students to develop knowledge, skills, and capabilities in the following areas: 

Behavioural models taught in this module are used in a variety of settings such as individual consumption decisions, investment decisions, firm pricing and policy making. By enhancing reasoning about decision making in such settings, and encouraging independent thinking to apply and expand on the taught content, the module contributes to employability, and resourcefulness and resilience.

The group presentation and project further develop employability skills by requiring students to collaboratively design and communicate experimental approaches, critically evaluate evidence, and produce structured written outputs, reflecting skills valued in research, policy, and industry contexts.

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 2026/7 academic year.