In economics, the standard model of human behavior is that of a rational, self-interested utility maximizer with unlimited cognitive resources. However, experimentalists and behavioral economists have cast doubt on the standard model, emphasizing that the model is not only wrong but wrong in ways that matter for economic outcomes. This has led to a literature that emphasizes departures from the standard model like bounded rationality (how cognitive constraints can affect choice behavior), temptation (self-control problems that could arise from addiction or impatience), and context dependence (how decision makers view the outcome of a choice in terms of a reference point or another context that is provided by the choice problem, as opposed to a taste for the outcome per se).
Mentees shall study (1) evidence that seems to show important limitations of the standard model, (2) how these issues are addressed with models that depart from the standard assumptions but not traditional economic methods, and (3) applications of the alternative models. The emphasis will be on (2) but the course should also be of value to anyone with interests in (1) or (3). You will become familiar with concepts and tools that have recently found applications to public economics, industrial organization, development, labor, health, energy, and finance.
The method of mentoring will have two components. Technical material will be presented via “asynchronous” screencast presentations. These are combined with meetings with me via zoom once a week.
The goal is for mentees to produce a detailed research proposal that can serve as the basis for future independent study.
Students interested in this program should sign up for Econ 509 during the summer in case it is offered.
Potential skills gained: Behavioral economic theory: tools and applications.
Required qualifications: Mentees should have (i) some knowledge of choice under uncertainty and game theory, although this material can be learned via self-study or a few meetings with me, and (ii) a math background at a level appropriate for students taking advanced undergraduate courses in economics.
Direct mentor: Faculty/P.I.