Behavioral decision-making
2011/2012

Ph.D. in Economics
Department of Economics
University of Bologna

Lecturer: Francesca Barigozzi
E-mail: francesca.barigozzi{at}unibo.it
(change {at} with @)

Topics:

  1. Introduction: Expected utility theory and non expected utility models. Slides here.

  2. Prospect theory, heuristics and biases. Slides here.

  3. Emotions and Economics. Slides here.

  4. Anticipatory feelings and information. Slides here.

  5. Intrinsic motivation in the labor market. Slides here.

 

This is the first part of a course on Behavioral and Experimental Economics offered by the Doctoral Program of the Department of Economics, University of Bologna. Subsequent lectures will cover the following topics:

Reading material for this part

  1. Starmer, C. (2000) "Developments in Non-Expected Utility Theory: The Hunt for a Descriptive Theory of Choice under Risk". Journal of Economic Literature Vol. XXXVIII, pp.332–382

  2. Kahneman, D., & Tversky, A. (1979). "Prospect Theory: An Analysis of Decision under Risk. Econometrica, Vol. 47(2), pp. 263-292.

  3. Kahneman, D., & Tversky, A. (2000). Choices, Values, and Frames. Cambridge : Cambridge University Press.

  4. Tversky, A. & Kahneman, D., (1974). Judgment under Uncertainty: Heuristics and Biases. Science, 185, 1124-1131.

  5. Gigerenzer, G., & Goldstein, D.G. (1996). “Reasoning the Fast and Frugal Way: Models of Bounded Rationality”. Psychological Review, 103, 650-670.

  6. Elster, J. (1998), "Emotions in Economic Theory", Journal of Economic Literature (XXXVI), pp. 47-74.

  7. Cohen, JD (2005). "The vulcanization of the human brain: A neural perspective on interactions between cognition and emotion", Journal of Economic Perspectives, 19, 3-24.

  8. Loewenstein, G, (2000), "Emotions in Economic Theory and Economic Behavior", AEA Papers and Proceedings 90 (2), 427-432.

  9. Rick, S. and Loewenstein, G. (2008). "The Role of Emotion in Economic Behavior", in LEWIS, M., HAVILAND-JONES, J.M. & FELDMAN-BARRETT, L.F. (eds), The Handbook of Emotion (3rd Ed). New York, N.Y.: Guilford

  10. Kreps, D. and E. Porteus (1978). "Temporal Resolution of Uncertainty and Dynamic Choice Theory", Econometrica, 46, 185-200.

  11. Caplin A, and J. Leahy (2001). "Psychological Expected Utility Theory and Anticipatory Feelings", Quarterly Journal of Economics, 55-80.

  12. Kozsegi, B. (2003). "Health Anxiety and Patient Behavior", Journal of Health Economics, 22 , 1073-1084.

  13. Kozsegi, B, (2006). "Emotional Agency", Quarterly Journal of Economics,121(1): 121-155.

  14. Barigozzi, F. and R. Levaggi (2010). "Emotional Decision-Makers and Anomalous Attitudes towards Information", Journal of Risk and Uncertainty (40), 255-280.

  15. Rebitzer J.B. and L.J. Taylor (2010). "Extrinsic Rewards and Intrinsic Motives: Standard and Behavioral Approaches To Agency and Labor Markets", working paper Levy Economics Institute.

  16. Heyes A., (2005) "The economics of vocation or -why is a badly paid nurse a good nurse-?", Journal of Health Economics 24, 561-569.

  17. Barigozzi F. and G. Turati (2010). "Human Health Care and Selection Effects. Understanding Labour Supply in the Market for Nurses", forthcoming in Health Economics.


EXAM
Each student will be required to write a referee report (maximum 5 pages) and a research project (maximum 10 pages).

The referee report will consist of a critical discussion of a paper. A typical structure for a referee report is as follows:
- brief summary of the paper (no more than 10 lines)
- relevance and contribution of the paper to the literature
- critical assessment of positive and negative aspects
- suggestions for improvement
- references (if any)
The paper will be chosen by the student from the list below (exceptions are possible, upon previous agreement with one of the instructors)

The research project will examine a particular problem and it will suggest a study or studies that could be conducted to test ideas and advance knowledge. A possible structure for the project is as follows:
- introduction and motivation
- contribution to the literature
- content of the research proposal, including how the study could be implemented
Once the student has decided the topic and has a broad idea about the content of the project, he/she should write an abstract and send it to the lecturer whose research is more closely related to the project. The student will proceed and prepare the project after a positive feed-back by the lecturer.


-----------PAPERS LIST-------------------

- INTERTEMPORAL CHOICE
Casari, M., and Dragone, D. (2011). On negative time preferences. Economics Letters, 111, 37-39.
Casari, M., and Dragone, D. (2011). Impatience, anticipatory feelings and uncertainty: A dynamic experiment on time preferences, wp DSE 777
Dragone, D., and Savorelli, L. (2010). Thinness and obesity: a model of food consumption, health concerns, and social pressure, wp LSE STICERD EOPP17.
Dragone, D. (2009). I am getting tired: effort and fatigue in intertemporal decision-making. Journal of Economic Psychology, 30, 552-562. paper, abstract
Dragone, D. (2009). A rational eating model of binges, diets and obesity. Journal of Health Economics, 28, 799-804. paper, abstract

SOCIAL AND MORAL ENFORCEMENT
- Buonanno, P., G. Pasini and P. Vanin (2011), Crime and Social Sanction, Papers in Regional Science, in press
- Cervellati, M., and P. Vanin (2010), "Thou Shalt Not Covet ...": Prohibitions, Temptation and Moral Values, FEEM Working Paper N. 54
- Buonanno, P., D. Montolio and P. Vanin (2009), Does Social Capital Reduce Crime?, Journal of Law and Economics,  52(1), 145-170
- Antoci, A., P. L. Sacco and P. Vanin (2007), Social Capital Accumulation and the Evolution of Social Participation, Journal of Socio-Economics, 36(1), 128-143

INTRINSIC MOTIVATION
- Barigozzi, F. and P. Tedeschi (2011), Credit Markets with Ethical Banks and Motivated Borrowers. Working paper n.786, Department of Economics, University of Bologna.
- Barigozzi, F. and D. Raggi (2011), Workers' selection in a vocation-based labor market. Mimeo, University of Bologna.


BEHAVIORAL INDUSTRIAL ORGANIZATION
- Bigoni, Fridolfsson, Le Coq, Spagnolo: "Fines, Leniency and Rewards in Antitrust: An Experiment", CEPR Discussion Paper No. DP7417, 2009 
- Bigoni: "What do you want to know? Information acquisition and learning in experimental Cournot games", Research in Economics, Volume 64, Issue 1, March 2010


BEHAVIORAL GAME THEORY
- Carbonara, E. and P. Pasotti. Social Dynamics and Minority Protection. International Review of Law and Economics, Vol. 40, Iss. 4: 317-328.
- Carbonara, E. and F. Parisi. Choice of Law and Legal Evolution: Rethinking the Market for Legal Rules. Public Choice, Vol. 139, Iss. 3: 461-492.
- Carbonara, E., F. Parisi and G. von Wangenheim. Lawmakers as Norm Entrepreneurs. Review of Law and Economics, Vol. 4 : Iss. 3, Article 5: 779-799.
- Carbonara, E., F. Parisi and G. von Wangenheim (2010). Inexpressive Law. Minnesota Legal Studies Research Paper No. 08-03.


EVOLUTION OF SOCIAL NORMS
- Bagnoli L. and G. Negroni. The evolution of conventions in minimum effort games. Mimeo, Department of Economics, University of Bologna.
- Bagnoli L. and G. Negroni. On the coevolution of social norms. Mimeo, Department of Economics, University of Bologna.