EC343-Behavioural Economics

Module Provider: School of Politics, Economics and International Relations
Number of credits: 20 [10 ECTS credits]
Terms in which taught: Autumn term module
Pre-requisites: EC201 Intermediate Microeconomics
Non-modular pre-requisites:
Modules excluded:
Module version for: 2017/8

Module Convenor: Dr Ferdinand Vieider


Summary module description:
This module offers students the opportunity to extend their understanding of how a broad range of economic decisions are made. Neoclassical economics is underpinned by numerous assumptions about how agents make decisions. According to empirical evidence, some of these are incorrect. Behavioural economics broadens economic theory to improve its fit with real-world behaviour. This module explains some of the key challenges to neoclassical theory and describes how behavioural economics has sought to explain such unorthodox and apparently irrational economic behaviour. It further shows how the alternative insights derived from behavioural theories have been and can be applied to policy making.

The aims of this module are to:
• Explain the key assumptions that underlie neoclassical economics regarding the manner in which economic decisions are made by agents such as individuals and businesses;
• Illustrate and evaluate the empirical evidence that apparently contradicts neoclassical assumptions;
• Explain and evaluate the theoretical contributions of behavioural economics that seek to extend economic theory to better accommodate patterns in real-world decision-making.
• Discuss and show policy implications of the modified theories

Assessable learning outcomes:
Students will be assessed on their ability to describe and critically evaluate with precision both the challenges to neoclassical economics and the contributions of behavioural economics highlighted in the module. This will include the ability to rigorously analyse: concepts of economic rationality; alternative formulations of economic preferences; and the manner in which economic choices are made both under uncertainty and across time. Data analysis is an integral part of the course, and serves to inform the development of alternative theories in a `learning by doing’ approach.

Additional outcomes:
Students will be required to apply theoretical knowledge to real world situations. Students should be able to apply the key insights of the module to a broad range of economic decision-making, such as consumption, investment decisions, inter-temporal tradeoffs and strategic interactions.

Outline content:
Basic topics include: expected utility theory; anomalies of decision making under risk and alternative models; violations of rationality; time-inconsistency and hyperbolic discounting; behavioural game theory and social preferences (broadly defined).

Brief description of teaching and learning methods:
A combination of lectures, group discussions of assigned topics and problems, and assessed essays. Problem sets and data analysis are an integral part of the learning process as well as the assessment.

Contact hours:
  Autumn Spring Summer
Lectures 20
Guided independent study 180
Total hours by term 200.00
Total hours for module 200.00

Summative Assessment Methods:
Method Percentage
Written assignment including essay 50
Class test administered by School 50

Other information on summative assessment:
There is a final essay that carries 50% of the weight. The remaining 50% is assigned based on classwork, including data analysis, solution of problem sets, and a classroom assessment.

Formative assessment methods:

Penalties for late submission:

Coursework has a weight of 100% in the final assessment mark.

Penalties for late submission will be in accordance with current University policy.

The Module Convenor will apply the following penalties for work submitted late, in accordance with the University policy.
  • where the piece of work is submitted up to one calendar week after the original deadline (or any formally agreed extension to the deadline): 10% of the total marks available for the piece of work will be deducted from the mark for each working day (or part thereof) following the deadline up to a total of five working days;
  • where the piece of work is submitted more than five working days after the original deadline (or any formally agreed extension to the deadline): a mark of zero will be recorded.

  • The University policy statement on penalties for late submission can be found at:
    You are strongly advised to ensure that coursework is submitted by the relevant deadline. You should note that it is advisable to submit work in an unfinished state rather than to fail to submit any work.

    Length of examination:

    Requirements for a pass:
    A minimum overall mark of 40%.

    Reassessment arrangements:
    Re-assessment is by resubmission of coursework which will be required by the end of the re-examination period in August/September.

    Additional Costs (specified where applicable):
    1) Required text books:
    2) Specialist equipment or materials:
    3) Specialist clothing, footwear or headgear:
    4) Printing and binding: There may be optional costs associated with photocopying or printing sources listed on the reading list relating to this module. Please note that the Library charges approximately 5p per photocopy.
    5) Computers and devices with a particular specification:
    6) Travel, accommodation and subsistence:

    Last updated: 31 March 2017

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