Economic research using laboratory and field experiments has discovered robust behavioural deviations from the model of homo
economicus, the rational, egoistic decision maker assumed in “standard” economic theory. In this course -- building on ECON2126 – we
explore the challenges these behavioural regularities poses for economic theory, and will study behavioural economic models of decision
making which aim to incorporate and predict real-world economic behaviour. Specifically we review models of social preferences like
altruism, inequality aversion, sequential and simultaneous reciprocity, as well as models of bounded rationality like decision errors,
learning, limited foresight and limited cognition. The course will also cover issues of behavioural market design, specifically the robustness
of market mechanisms and other institutions against strategic, irrational or socially motivated behaviour.