PhD in Economics
Study group in Behavioral Economics 2008/09
Giacomo Calzolari
The objective of this course is to present and discuss some of the most important articles in the literature on behavioural economics building from scratch a minimal knowledge of the field. At the end of the course students will have a broad picture of the main themes addressed by this literature, the topics currently at the frontier and should be able to perform their own research. Empirical evidence will be discussed, but more emphasis will be devoted to the analysis of formal models that can be used to incorporate behavioral evidence in economic analysis.
The study group is organized with presentations by all enrolled participants. Each participant will have to present at least one (probably two) paper(s) from a required reading list. Anyone in the group must read the papers before presentations and be active at the meetings in an open discussion lead by the presenter.
Presentations must be performed with slides. To prepare presentations PhD students must read and study this document on "How to make good presentations".
After the discussion in class the presenter accordingly adjusts his/her slides emending errors and non clear parts and shares the slides in this webpage as a pdf and originating software according to the following Creative Common license 
"This work is licensed under a Creative Commons Attribution-Noncommercial-Share Alike 2.5 Italy License." The attribution should be to the "Study Group on Behavioral Economics Unibo 2008-09". By so doing we will build a repository of presentations that could be used at will by anybody in the group of this and future years.
To enroll, send an email to teacher responsible for this course. A mailing list will be created and distributed to participants.
The following is a (maximal) list of topics that will be discussed.
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Judgment Under Uncertainty and Prospect Theory
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Mental Accounting
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Intertemporal Choice (temptation, addiction etc.)
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Behavioral Game theory and Learning in games
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Fairness and Social preferences
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Hedonics and happiness
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Applications in Industrial Organization, Contract Theory, Incentives
Find below a temptative schedule for (the first) 6 meetings.
Meeting 1, Date 21/11/08, Time 13-14, Room Seminar room Scaravilli
Allocation of readings to presenters.
Meeting 2, Date 28/11/08, Time 11-13am, Room Seminar Room
- Issues with uncertainty and prospect theory (Francesca, Giacomo) ABE ch.4 “Developments in non-expected utility” & Tversky, A. and Kahneman, D. (1974), “Judgment under Uncertainty: Heuristics and Biases,” Science, pp. 1124-1131 [Additional reading ABE ch. 5 “Prospect theory in the wild: evidence from the field”] Slides Francesca, Slides Giacomo
- Mental accounting (Francesco) ABE ch. 3 “Mental accounting matters”, Slides Francesco, Slides second version
Meeting 3, Date 19/12/08, Time 12-14am, Room Seminar Room (NOTICE the change in the time schedule, 12-14 and not 11-13)
- Reference dependence (Gaetano) Heidhues, and Koszegi. 2005. “The Impact of Consumer Loss Aversion on Pricing.” & Koszegi, and Rabin. 2006. “A Model of Reference-Dependent Preferences” Quarterly Journal of Economics, 121(4): 1133-1166. Slides Gaetano 1, 2.
- Projection bias & Law of small numbers (Mattia) O’Donoghue and Vogelsang “Projection Bias in Catalog Orders”, AER 2007 & Rabin,. 2002 “Inference by Believers in the Law of Small Numbers.” Quarterly Journal of Economics, 117(3): 775-816. Slides Mattia 1, 2.
Meeting 4, Date 9/01/09, Time 11-13am, Room Seminar Room
- Intertemporal choice (Luca,) ABE ch. 6 “Time discounting and time preference: A critical review” and ch. 7 “Doing it now or later”
- Overconfidence (Emanuela) Gul, Faruk and Wolfgang Pesendorfer “Temptation and self-control” Econometrica, 2001, 69, 1403-35, Eliaz, , and Spiegler. 2006. “Contracting with Diversely Naive Agents” Review of Economic Studies, 73(3): 689-714. & Benabou, and Tirole, (1999), “Self-confidence: Intrapersonal Strategies,” mimeo
Meeting 5, Date 16/01/09, Time 11-14am, Room Seminar Room
- Overconfidence (Paolo) DellaVigna, and Malmendier. 2006. “Paying Not to Go to the Gym.” American Economic Review, 96(3): 694-719 DellaVigna, and Malmendier. 2004. “Contract Design and Self-Control: Theory and Evidence.” Quarterly Journal of Economics, 119: 353-402 ; slides 1, slides 2
- Limited attention (Francesco) Gabaix, X. and D. Laibson (2005) “Shrouded attributes, consumer myopia and information suppression in competitive markets,” April 2005, QJE - Gabaix, X., D. Laibson, G Moloche, S Weinberg. (2002) “The Allocation of Attention: Theory and Evidence,” mimeoe Slides 1, Slides 2
- Menu effects and heuristics (Giuseppe) TBA
Meeting 6, Date 23/01/09, Time 11-13am, Room Seminar Room
- Behavioral game Theory (Tommaso, Giuseppe) Camerer: Introduction, and Behavioral game theory: Predicting human behavior in strategic interactions. Chapter 13 in C.Camerer, G. Loewenstein & M. Rabin (Eds.) Advances in Behavioral Economics. Princeton, NJ: Princeton University Press. - Camerer, C.F. (2003). Strategizing in the brain. Science, 300, 1673-1675. - Learning (not only in games): Chapter 6 in Behavioral game theory Camerer SlidesTommaso, Slides Giuseppe
Meeting 7, Date 30/01/09, Time 11-14am, Room Seminar Room
- Contracts and Incentives (Andrea, Sarah) Fehr, and Falk (2001) “Psychological Foundations of Incentives,” - Englmaier and Wambach Optimal Incentive Contracts under Inequity Aversion - Fehr and Gächter Do Incentive Contracts Undermine Voluntary Cooperation? - Brown, Falk and Fehr. Relational contracts and the nature of market interaction. Econometrica Slides Sarah 1, 2 , Slides Andrea
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