An Introduction to Behavioral Economics

✍ Scribed by Nick Wilkinson, Matthias Klaes

• Publisher: Palgrave Macmillan / Springer
• Year: 2017
• Tongue: English
• Leaves: 616
• Edition: 3
• Category: Library

✦ Synopsis

The third edition of this successful textbook is a comprehensive, rigorous survey of the major topics in the field of behavioral economics. Building on the strengths of the second edition, it offers an up-to-date and critical examination of the latest literature, research, developments and debates in the field. Offering an inter-disciplinary approach, the authors incorporate psychology, evolutionary biology and neuroscience into the discussions. And, ultimately, they consider what it means to be 'rational', why we so often indulge in 'irrational' and self-harming behavior, and also why 'irrational' behavior can sometimes serve us well.

A perfect book for economics students studying behavioural economics at higher undergraduate level or Master's level.

This new edition features:
- Extended material on heuristics and biases, and new material on neuroeconomics and its applications
- A wealth of new topical case studies, such as voting behavior in Brexit and the Trump election and the current obesity epidemic
- More examples and review questions to help cement understanding

✦ Table of Contents

Cover
Detailed Table of Contents
List of Figures
List of Tables
Preface
Acknowledgments
PART I Introduction
CHAPTER 1 Nature of Behavioral Economics
1.1 Behavioral economics and the standard model
1.2 History and evolution of behavioral economics
1.3 Relationship with other disciplines
1.4 Objectives, scope and structure
1.5 Summary
1.6 Review questions
1.7 Applications
CHAPTER 2 Methodology
2.1 Theories
2.2 Evidence
2.3 Consilience
2.4 Summary
2.5 Review questions
2.6 Applications
PART II Foundations
CHAPTER 3 Values, Preferences and Choices
3.1 The neoclassical model
3.2 Axioms, assumptions and definitions
3.3 The evolutionary biology of utility
3.4 The neuroscientific basis of utility
3.5 Broadening rationality
3.6 Visceral factors
3.7 Types of utility
3.8 Policy implications
3.9 Summary
3.10 Review questions
3.11 Applications
CHAPTER 4 Beliefs and Expectations
4.1 The neoclassical model
4.2 Probability estimation
4.3 Self-evaluation bias
4.4 Magical beliefs
4.5 Causes of irrationality
4.6 Summary
4.7 Review questions
4.8 Review problems
4.9 Applications
CHAPTER 5 Decision-making under Risk and Uncertainty
5.1 Background
5.2 Conventional approaches to modifying expected utility theory
5.3 Prospect theory
5.4 Reference points
5.5 Loss-aversion
5.6 Shape of the utility function
5.7 Decision-weighting
5.8 Criticisms of prospect theory
5.9 Recent theories and conclusions
5.10 Summary
5.11 Review questions
5.12 Review problems
5.13 Applications
CHAPTER 6 Mental Accounting
6.1 Nature and components of mental accounting
6.2 Framing and editing
6.3 Budgeting and fungibility
6.4 Choice bracketing and dynamics
6.5 Policy implications
6.6 Summary
6.7 Review questions
6.8 Applications
PART III Intertemporal Choice
CHAPTER 7 The Discounted Utility Model
7.1 Introduction
7.2 Origins of the discounted utility model
7.3 Features of the discounted utility model
7.4 Methodology
7.5 Anomalies in the discounted utility model
7.6 Summary
7.7 Review questions
7.8 Applications
CHAPTER 8 Alternative Intertemporal Choice Models
8.1 Time preference
8.2 Time-inconsistent preferences
8.3 Hyperbolic discounting
8.4 Modifying the instantaneous utility function
8.5 More radical models
8.6 Empirical evidence
8.7 Policy implications
8.8 Summary
8.9 Review questions
8.10 Applications
PART IV Strategic Interaction
CHAPTER 9 Behavioral Game Theory
9.1 Nature of behavioral game theory
9.2 Solution concepts
9.3 Mixed strategies
9.4 Bargaining
9.5 Iterated games
9.6 Signaling
9.7 Learning
9.8 Summary
9.9 Review questions
9.10 Review problems
9.11 Applications
CHAPTER 10 Social Preferences
10.1 The neoclassical model
10.2 The nature of social preferences
10.3 Factors affecting social preferences
10.4 Modeling social preferences
10.5 Inequality-aversion models
10.6 Reciprocity models
10.7 Empirical evidence
10.8 Policy implications
10.9 Summary
10.10 Review questions
10.11 Applications
PART V Conclusion
CHAPTER 11 Behavioral Economics: Summary and Outlook
11.1 The agenda of behavioral economics
11.2 Criticisms of behavioral economics
11.3 Methodology
11.4 Are we really irrational?
11.5 Welfare and happiness
11.6 Problems in pursuing happiness
11.7 Policy implications
11.8 Future directions for behavioral economics
11.9 Applications
Bibliography
Index