114-0539/01 – Behavioral Economics (BE)

Gurantor departmentDepartment of EconomicsCredits5
Subject guarantordoc. Ing. Aleš Melecký, Ph.D.Subject version guarantordoc. Ing. Aleš Melecký, Ph.D.
Study levelundergraduate or graduateRequirementCompulsory
Year1Semestersummer
Study languageEnglish
Year of introduction2019/2020Year of cancellation
Intended for the facultiesEKFIntended for study typesFollow-up Master
Instruction secured by
LoginNameTuitorTeacher giving lectures
HLA31 Ing. Karel Hlaváček, Ph.D.
MEL044 doc. Ing. Aleš Melecký, Ph.D.
SUL080 Ing. Monika Šulganová, Ph.D.
Extent of instruction for forms of study
Form of studyWay of compl.Extent
Full-time Credit and Examination 2+2

Subject aims expressed by acquired skills and competences

Characterize the nature of behavioral economics and explain the basic concepts in this field. Describe the differences between classical and behavioral economics and criticism of rational decision making. Introduce basic behavioral heuristics and their practical applications. Introduce the penetration of behavioral economics into other areas such as behavioral finance and marketing.

Teaching methods

Lectures
Seminars

Summary

Economic theory perceives in its models a human as a rational individual maximizing its utility. Such an individual is only considered to be the optimal theoretical concept, and the actual behavior of a person may sometimes appear to be seemingly irrational. In this course, we abandon the assumptions of traditional models and focus on both, consumer behavioral theory and business theory, but also on investment theory and finance from a behavioral perspective. The experimental economics overcome the barrier of pure rationality and selfishness, and along with behavioral economics it allows economists to observe human behavior.

Compulsory literature:

DHAMI, Sanjit S. The foundations of behavioral economic analysis. Oxford: Oxford University Press, 2017. ISBN 9780198715535. WILKINSON, Nick. An introduction to behavioral economics: A Guide for Students. New York: Palgrave Macmillan, 2007. ISBN 9780230532595. THALER, Richard B. Misbehaving: The Making of Behavioral Economics. W. W. Norton, 2016. ISBN 9780393352795.

Recommended literature:

BADDELEY, Michelle. Behavioural Economics: A Very Short Introduction. Oxford: Oxford University Press, 2017. ISBN-13: 9780198754992. SKOŘEPA. Michal. Decision Making: A Behavioral Economic Approach. Houndmills, Basingstoke: Palgrave Macmillan, 2010. ISBN 978-0230248250. KAHNEMAN, Daniel. Thinking, fast and slow. New York: Farrar, Straus and Giroux, 2013. ISBN 9780374533557.

Way of continuous check of knowledge in the course of semester

E-learning

Další požadavky na studenta

nutno doplnit, nutno doplnit

Prerequisities

Subject has no prerequisities.

Co-requisities

Subject has no co-requisities.

Subject syllabus:

1) Introduction to Behavioural Economics • Antecedents of behavioural economics • Methodology of economics • Theoretical approaches in behavioural economics • Experimental method in economics • Examples of behavioural evidence 2) Behavioural Decision under Risk and Uncertainty • Classical decision theory • Subjective expected utility theory • Violations of expected utility theory 3) Behavioural Models of Decision Making • Rank dependent utility theory • Prospect theory • Human behaviour for extreme probability events • Risk preferences and time preferences 4) Applications of Behavioural Decision Theory • Endowment effect and exchange asymmetries • Myopic loss aversion • Goals and contracts as reference points • Moral hazard, loss aversion, and optimal contracts 5) Present Bias and Time-inconsistency • Evidence on temporal human choice • Behavioural models of time discounting • Applications of present-biased preferences 6) Behavioural Game Theory • Evidence of strategic human choice • Models of behavioural game theory 7) Behavioural models of learning • Evolutionary game theory • Models of learning • Stochastic social dynamics 8) Emotions • Emotions of human behaviour • Interactions between emotions and cognition 9) Bounded Rationality • Judgment heuristics • The law of small numbers • Conjunction fallacy • The availability heuristics 10) Behavioural Finance • Neoclassical theory of capital markets and its limitations • Behavioural perspective on investors` behaviour • Speculative bubbles as a characteristics of market anomalies 11) Social Preferences and Labour Economics • Evidence on social behaviour • Models of fairness and reciprocity • Applications in labour economics 12) Economics of information • Moral hazard and incentive contracts • Adverse selection and signaling • Economics and psychology

Conditions for subject completion

Full-time form (validity from: 2019/2020 Winter semester)
Task nameType of taskMax. number of points
(act. for subtasks)
Min. number of points
Credit and Examination Credit and Examination 100 (100) 51
        Credit Credit 30  18
        Examination Examination 70  21
Mandatory attendence parzicipation: not defined

Show history

Occurrence in study plans

Academic yearProgrammeField of studySpec.FormStudy language Tut. centreYearWSType of duty
2019/2020 (N0311A050013) Applied Economics (S02) International Economic Relations P English Ostrava Choice-compulsory type B study plan
2019/2020 (N0311A050013) Applied Economics (S01) Economic Development P English Ostrava 1 Compulsory study plan
2019/2020 (N0412A050005) Finance P English Ostrava 1 Choice-compulsory type B study plan

Occurrence in special blocks

Block nameAcademic yearForm of studyStudy language YearWSType of blockBlock owner