The objectives of the course are:
• to provide students with the knowledge of core concepts and models
in the field of decision theory and behavioral economics.
• to provide students with the knowledge of basic decision theory
models' assumptions, internal logic and predictions, grounding the
explanations on intuitive, graphical and analytical approaches.
• to develop students' ability to apply the knowledge acquired to the
analysis of specific economic cases, recognizing proper framework of
analysis and constructing and analyzing adequate economic model
within this framework.
The course is divided into two parts. The first half, on behavioral decision theory,
studies models in which standard economic rationality assumptions are
combined with psychologically plausible assumptions on behavior. We consider
whether the new models improve ability to predict and understand choice under
uncertainty (and certainty), probabilistic judgment, and intertemporal choice.
The second half, on behavioral game theory, studies how players model others’
decisions in initial responses to games; and how players learn to predict others’
decisions via learning in repeated play of analogous games.
Final written exam