PAM 3130

Behavioral Economics and Public Policy

Course Description

Course information provided by the Courses of Study 2015-2016.

Standard economic theory assumes that individuals are rational decision-makers; however, that is often not the case in the real world. Behavioral economics uses findings from psychology to determine ways in which individuals are systematically irrational to improve upon existing models. The first part of this course reviews these theories, while the second part of the course focuses on how these findings have been used to design better education, health, and tax policies as well as many others.

When Offered Fall.

Prerequisites/Corequisites Prerequisites: PAM 3100 or ECON 3125 and PAM 2000 or ECON 3030. Some courses in other departments may be substituted, but they need to be cleared first.

• Use the key findings in psychology that have important lessons for the field of economics.
• Apply economic insights from lab experiments to policy design.
• Interpret empirical results from research papers as they relate to policy.
• Identify areas of policy where taking behavioral insights into account could improve public policy in terms of implementation, efficiency, or redistribution.
• Identify assumptions in standard economic models that may not hold in real world settings and learn how economists test their validity.
• Present findings from top-tier journals in economics.

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