EXPERIMENTAL AND BEHAVIOURAL ECONOMICS

EXPERIMENTAL AND BEHAVIOURAL ECONOMICS

Daniela Teresa Di Cagno

Instructional goals

This course is a follows a practical research approach to experimental and behavioral economics and is thus intended to: 1. expose you to a diverse range of experimental economics research papers 2. teach you how to think of economic problems from the perspective of empirical science. 3. provide you with a knowledge to come up with, design, and conduct experiments.

Intended learning outcomes

KNOWLEDGE AND UNDERSTANDING: The student will be able to analyze and understand the main issues described during the course. APPLYING KNOWLEDGE AND UNDERSTANDING: At the end of the course, the student must be able to use the tools to carry out lab and web experiments. MAKING JUDGEMENTS: The student will acquire the ability to evaluate in an autonomous way experiments on selected topics. COMMUNICATION SKILLS: The student will acquire the specific language in order to communicate precisely the concepts learned. LEARNING SKILLS: The student will learn the methodology of analysis of the main problems related to experimental and behavioral issues.

Course Contents

This course introduces students to the methods of Experimental Economics and includes applications to behavioral economics. Students will be introduced to discussion about both the power and the limitations of experimental economics as a data collection method and to discoveries that have spurred a deeper interest in individual and group behavior. Students will practice the methods taught by reviewing published papers and designing their own experiments.

Reference Books

Joachim Weimann and Jeannette Brosing-Koch, Methods in Experimental Economics, 2019. John Kagel and Alvin Roth, Handbook of Experimental Economics, Volumes I and II, Elsevier Ebooks, 2015.

Teaching Methods

Lectures and experiments in class and in the lab.

Assessment Method

Written exam plus intermediate learning checks. In particular: Continuous Assessment (1/3 of the overall grade): Mandatory activities done throughout the semester. In the event of absence and/or withdrawal from one or more assessment tasks, the mark is 0 and it is included in the calculation of the final grade. The evaluation obtained cannot be rejected. Final Exam (2/3 of the overall grade): Individual final exam taken during the exam dates scheduled in the examination session at the end of the semester in which the course is taught. The evaluation obtained cannot be rejected. Students exempt from the attendance requirement or not compliant with the attendance threshold The assessment is based on a final exam, which accounts for 100% of the overall grade and includes an adequate instructional load to compensate for the student’s non-participation in the semester activities. The evaluation obtained cannot be rejected.

Thesis assignment criteria

Pass the exam

Week 1

An overview of experimental economics: The History of Economic and Psychological experiments

Week 2

Pros and cons of experimental economics: External validity, replicability and the role of incentives.

Week 3

Methodological foundations: the induced value method, subjects, beliefs and payoffs. The influence of the experimenter.

Week 4

Interaction between subjects, decisions made by subjects, the repetition of games.

Week 5

Experimental practice: setting up an Experimental Laboratory, Preparing and conducting an experiment.

Week 6

The experiment from a statistical perspective and data analysis: Operationalizing the research question, Statistical tests and power analysis.

Week 7

Experiments on risk and ambiguity

Week 8

Experiments of dynamic decision making

Week 9

Experiments on strategic interaction

Week 10

Bargaining and market experiments

Week 11

Cheating and asymmetric information experiments.

Week 12

Discussion of students projects