AOL COURSE OUTLINE FORMAT

SBM-NMIMS: COURSE TEACHING PLAN

Assurance of Learning AOL Specific
Course Code
Behavioural Economics
Course Title

Course Prof. Binod Kumar Bahera

Instructor/s
3
Credit Value
Programme & MBA II yr. Trim VI (2024-25)
Trimester
Microeconomics
Pre-requisite

CLOs – (in bracket state the PLOs to map)

CLO 1) Provide an introduction to and an overview of the field of behavioral economics

(PLO3c)
Learning
CLO 2) Establish fundamental principles in behavioral economics and then explore the
Objectives
methods through which behavioral economics is applied in research (PLO2c)

CLO 3) Contextualize applications of behavioural economics to emerging issues in policy,

corporations, and human resources (PLO1a)

1) Critically assess existing theories in economics and understand behavioral basis for
the same (CLO1)
Learning
Outcomes
2) Review interventions and policies through the lens of behavioral economics with a view
(Must be
to identify and plug potential gaps (CLO3)
connected to
Learning
3) Explore existing theories in behavioral economics and apply varied methods to assess
Objectives)
their applicability within insights from psychology and behavioural science (CLO2)

Increasingly, there is an interest in behavioural science and its applications not just in the
context of business, but also in public policy, economics research, and several other
avenues of work. Recent advances in economics have relied extensively on inter-
Course
disciplinary work and blending insights from fields such as psychology to improve our
Description
understanding of decision-making. Incorporating more such perspectives of this kind is
critical to staying up-to-date with work in economics

Specific assessment 3 1.5 AOL CLO CLO CLO

methods Credit Credit Instruments 1 2 3
(*)

Individual assignment 20 Embedded Q 5 5 10

Evaluation
Pattern Case and Article 30 Rubrics 16 14
Discussion with Group
Presentation
Class Participation 10
Final Exam 40 Embedded Q 15 10 15
Total 100
 Topics / Sub - Chapter detail Pedagogy adopted for class engagement
Sessio
topics / Article Reference / Case Studies Learning Outcomes
ns
session wise
Introduction to Chapter 4, Misbehaving by Richard Presentation by faculty followed by
Behavioral Thaler class discussion of case:
Economics and
1 History of BE Learning Outcomes: Students will learn
about applying behavioural science and
psychology to economics and the value of
the same
Rationality and Chapter 4, Misbehaving by Richard Presentation by faculty followed by
Rational Thaler class discussion of rationality:
Decision-making
2
Learning Outcomes: Students will discuss
rationality and rational-decision making in
various contexts.
Prospect Theory, Chapters 7-12, Misbehaving by Presentation by faculty followed by
Heuristics and Richard Thaler class discussion of prospect theory and
Biases experiment:
3
Learning Outcomes: By participating in
classroom experiments students will learn
about the contexts in which prospect
theory and cognitive biases play a role.
Mental Thaler , Richard. "Mental accountin Presentation by faculty followed by
Accounting gand consumer choice." Marketing S class discussion of mental accounting
cience 4.3(1985): 199-214. and experiment:
4 Thaler, Richard H. "Mental accounti Learning Outcomes: By participating in
ng matters." Journal ofBehavioral classroom experiments students will learn
Decision Making 12.3 (1999): 183- about the contexts in which mental
206 accounting can be applied
Choice J.C. Penney Sued for Presentation by faculty followed by
bracketing, and ever Charging Full Price class discussion of choice bracketing
dynamic mental : [Link] case:
accounting. lawsuit-deceptive-pricing/
5 Bush is a sucker for the sunk cost fall Learning Outcomes: The case discussed
acy : [Link] will deal with deceptive pricing as well as
politics/2005/09/bush-is-a-sucker- sunk-cost fallacies, illustrating these
[Link] concepts in different areas.
Intertemporal Gratitude is the new willpower. HBR Presentation by faculty followed by
Choice : [Link] class discussion of case:
the-new-willpower
6 Learning outcomes: Students will be
able to critically examine issues related to
decisions that involve costs and benefits
spread over time.
Impatience Risk Preferences and the Role of Presentation by faculty followed by
Intuition Under Uncertainty class discussion of case:
by Manel Baucells and Franz
Heukamp Learning outcomes: Students will learn
7 [Link] how to distinguish application of time
preferences-and-the-role-ofintuition- preferences in different contexts. In
under-uncertainty/IES873 some of the decisions (like going to a
gym), the costs are immediate while the
benefits accrue over time and in some
 decisions (like eating chocolates), the
benefits are immediate while costs
accumulate over time.
Time Curbing the procrastination instinct. Presentation by faculty followed by
Inconsistency HBR: [Link] class discussion of case:
g-the-procrastination-instinct
Learning outcomes: Students will be
8 able to discern that many managerial and
personal decisions relate to time
preferences, and understanding biases
involved while making such decisions is
critical to good management.
Reference O'Donoghue, T., & Rabin, M. Presentation by faculty followed by
Dependent (1999). Doing it now or class discussion of paper + experiment:
Preferences later. American economic
review, 89(1), 103-124. Learning outcomes: Students will be
9 O'Donoghue, T., & Rabin, M. able to come up with how reference
(2001). Choice and points in decision-making are typically
procrastination. The Quarterly formed, and what impact they may have
Journal of Economics, 116(1), 121- on decision-making in uncertain
160. contexts.
Consumer Iyengar, S. S., & Lepper, M. R. Presentation by faculty followed by
Psychology (2000). When choice is demotivating: class discussion of paper + experiment:
(Choice overload, Can one desire too much of a good
option paralysis) thing?. Journal of personality and Learning outcomes: The idea is to expand
10 social psychology, 79(6), 995. on knowledge of cognitive biases into the
Schwartz, B., & Ward, A. (2004). realm of managerial and consumer
Doing better but feeling worse: The decision-making. This session will allow
paradox of choice. Positive for both choice and information overload
psychology in practice, 86-104. as barriers to efficient decision-making
Subjective Well- Clark (2018), “Four decades of the Presentation by faculty followed by
being and economics of happiness: Where class discussion of papers:
Happiness next?” Review of Income and
Wealth, 64 (2), 245–69. Learning outcomes: Appreciate the value
[Link] of alternative measures of well-being
Angner (2015), “Well-being and beyond economic or other tangible
11
economics,” in Guy Fletcher, ed., outputs. Motivated students can also learn
The Routledge Handbook of about how to measure well-being in a
Philosophy of Well-Being, London: scientific and rigorous way.
Routledge, pp. 492–503.
[Link]
m/doi/10.4324/9781315682266.ch40
Social Text, Chapter 11 Presentation by faculty followed by
Preferences Chapter 2 of Camerer (2003), class discussion of paper + experiment:
(inequity, Behavioral Game Theory:
fairness, trust) – Experiments in Strategic Interaction, Learning outcomes: Understanding how
12 Decision-making New York, NY: Russell Sage preferences for equity and fairness are
under uncertainty Foundation. formed, and how they apply to various
(risk aversion) – [Link] negotiation and bargaining scenarios
Scarcity and cr_Xg7cRvdcC&pg=PA43 (including wage negotiations).
cognitive load
Theoretical Class discussion This session will be entirely discussion
methods vs. based on the role of theory vs. the value of
13
empirical empirical evidence from behavioural
methods economics.
Theoretical Mullainathan and Thaler (2020). How Discussion of paper:
14 studies in Behavioral Economics Differs from
behavioral Traditional Economics. Learning outcomes: Students will be able
 economics [Link] to examine the value of behavioural
[Link] science, psychology in economics.
The Experimental Loewenstein, G. (1999). Presentation by faculty followed by
method Experimental economics from the class discussion of paper + experiment:
vantage-point of behavioural
15 economics. The Economic Learning outcomes: Students will be able
Journal, 109(453), F25-F34. to grasp the intuition behind conducting
experiments using treatment and control
groups as well as computer-based tasks.
Lab Experiments Carpenter, J. P., Harrison, G. W., & Presentation by faculty followed by
– Field List, J. A. (2005). Field experiments class discussion of paper:
Experiments in economics: An introduction. In
Field experiments in economics. Learning outcomes: By reading the paper
16 Emerald Group Publishing Limited. and the class discussion, students will
understand the nuances of designing
experiments in the workplace that will
need to be carefully tailored to the
research questions.
Natural Sneha, P. (2021). RCTs for policy in Presentation by faculty followed by
Experiments – India-Ethical Considerations, class discussion of paper + experiment:
Policy Methodological Concerns and
Experiments – Alternative Approaches. Indian Learning outcomes: Through reading the
Critique of Public Policy Review, 2(3 (May- paper(s) and engaging in class discussion,
methods used Jun)), 65-86. students will come up with how to
17
critically assess the contributions of field
Deaton, A. (2020). Randomization in experiments in policy as well as the
the tropics revisited: a theme and workplace.
eleven variations (No. w27600).
National Bureau of Economic
Research.
Critique of Ross (2012), “The economic agent: Class discussion of paper + experiment:
behavioral Not human, but important,” in Mäki,
economics ed., Handbook of the Philosophy of Learning outcomes: In this session,
Science: Philosophy of Economics, students will learn about the boundaries
18 Amsterdam: Elsevier, pp. 691–735. and limitations of behavioural economics
[Link] and be able to outline similar
444-51676-3.50023- 3 shortcomings from earlier theories and
concepts learnt.
Applications in Loewenstein & Ubel (2010), Presentation by faculty followed by
Business and “Economics behaving badly,” New class discussion of paper:
Corporates – York Times, July 15, A31.
Neuroeconomics [Link] Learning outcomes: By reading the
19 opinion/[Link] paper(s), students will be expected to
judge the suitability of each experiment to
the context in which it was implemented,
list pros and cons of this approach, and
what could have been done differently.
Nudging & Sunstein (2014), “Nudging: A very Presentation by faculty followed by
Choice short guide,” Journal of Consumer class discussion of paper:
Architecture Policy, 37 (4), 583–588.
[Link] Learning outcomes: Students will be able
014-9273-1 to determine what is a ‘nudge’ and what is
20
not behaviourally-informed. They will be
driven primarily by practice-based
concerns, but also become aware of
theoretical underpinnings of choice
architecture.
Reading List and References
(must be comprehensive and Text book
complete with all details.) Angner, Erik. A Course in Behavioral Economics 3rd edition. Palgrave
Macmillan, 2021

References
1. Camerer, Colin F., George Loewenstein, and Matthew Rabin, eds.
Advances in behavioral economics. Princeton university press, 2011. First
edition.
2. Thaler, Richard, and Cass Sunstein. Nudge: Improving decisions about
health, wealth, and [Link] University Press, 2008. First edition.
3. List, John, and Uri Gneezy. The why axis: hidden motives and the
undiscovered economics of everyday life. Random House, 2014. First
edition

Prepared by Faculty Team Area & Program chairpersons

Approved by Associate Deans Approved by Dean SBM

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Disclaimer
While care has been taken in compiling this Course outline, The School of Business Management
of SVKM’s NMIMS University shall not be held liable in any manner to any person for any mistake
and / or omission in the contents of the Course outline.