B1431 - STRATEGY, BEHAVIOR, AND POLICY IN ECONOMICS

Learning outcomes

The course has three main objectives: (i) explain how economists learn from empirical evidence, and how lab, field, and natural experiments can help establishing causation; (ii) teach the intuition behind some intermediate game theoretical concepts; (iii) show a wide range of applications and topics in economics

Course contents

The course will provide a broad range of examples on how economic theory and experiments can be used to understand pressing societal problems as well as to inform governments, firms, and consumers. The applications will range from media bias to environmental conservation, from discrimination to education and social housing.

For each topic, we will start from simple theoretical models and will then discuss experimental evidence -- both supporting the model or showing potential limitations of the theory. While we will usually start from simple laboratory experiments and in-class demonstrations, the main focus of the course will be on field experiments.

Below is a list of topics which will be analyzed and discussed. The list is not exhaustive and some topics will be added based on the preferences of the participants.

INEQUALITY

• Theory: models of other-regarding preferences
• Lab experiments: giving behavior in the ultimatum and dictator games
• Field experiments: charitable giving; information experiments on inequality acceptance

COOPERATION AND THE ENVIRONMENT

• Theory: public goods games, models of other regarding preferences, coordination games and equilibrium selections
• Lab experiments: cooperation, conditional cooperation, minimum effort game
• Field experiments: conditional cooperation and forest management in developing countries

HUMAN CAPITAL FORMATION and EDUCATION

• Theory: production function, demand and supply of education
  
• Field experiments: pre-school interventions for disadvantaged children; interventions to foster grit and creativity among children and adolescents; the role of patience on educational attainments.

VOTING AND POLITICAL PARTICIPATION:

• Theory: median voter theorem;
• Lab experiments: tests of the median voter theorem;
• Field experiments: canvassing experiments to incentivize people to go out to vote (GOTV); effect of voter turnout on policies

MEDIA BIAS AND ECHO CHAMBERS

• Experiments on social media to understand the effect of counter-partisan information.

INCENTIVES AND THE WORKPLACE

• Theory: income and substitution effect; gift exchange hypothesis;
• Lab experiments: gift-exchange game;
• Field experiments: filed experiments testing income/substitution effect among gig workers; field experiments on the effect of incentives and layoffs in firms; field experiments on the effect of working from home.

Readings/Bibliography

Materials: lecture notes, slides, and readings will be made available during the course.

Teaching methods

The course comprises both traditional lectures and a hands-on laboratory part.

Students will have the chance to play simple experiments in class. In addition, we will discuss the basic features of the Qualtrics platform, which is very convenient to run simple experiments and information surveys. We will also discuss and analyze data from prominent research papers.

The class is designed to be highly interactive and students are expected to prepare presentations, videos/podcasts, and short essays.

Assessment methods

Exam (students attending): the final grade will be determined by

• class participation and problem sets: 30%

• groups assignments and presentation: 30%

• final essay: 40%

Office hours

See the website of Stefania Bortolotti