M140 - Behavioural Economics

This course offers an introduction to the behavioural approach to economics. The course begins from classical theories of rational decision making, discusses the empirical problems that arise when these theories are treated as positive theories, and then offers an alternative in the form of modern behavioural theories. These modern theories draw on the insights and findings of behavioural and experimental psychology, as well as experimental economics, to improve the modelling of economic actors. The course will also discuss recent attempts by neuroscientists to identify the underlying basis for economic decision making.