Behavioral economics combines knowledge from  psychology, neuroscience and microeconomics to study the effects of psychological, cognitive, emotional, cultural and social factors on economic decisions. Handout Video1 Video2

This section addresses inter-temporal decisions and introduces behavioral models that account for observed time-inconsistency.

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Self-control refers to the ability to regulate one's emotions, thoughts, and behavior in the face of temptations and impulses. This section reviews our current knowldege of the mechanisms that drive self-control problems and addiction.

Decision-makers exhibit intra-personal conflicts. Their choices can often be modeled as the result of a tension between different processes with different objectives and characteristics. 

Economics relies on axioms of rationality to build utility functions. This section describes failures of this formulation. Video1 Video2

The standard paradigm states that people's chocies can be represented by expected utility. However, many situations exhibit choices not consistent with it. Here we will review these failures and introduce alternative theories, including prospect theory, regret theory and ambiguity aversion. 

Some recent theories account for limited memory but tend to model it as a black box. In this section, we emphasize the neuroscientific evidence on memory and discuss how this knowledge can be incorporated to build acurate models of decision-making. 

Economic models presupposed that economic agents form rational (bayesian) beliefs. However, many biases in judgement and failures of learning abilities have been detected. This section addresses the underlying reasons why people do not act in a bayesian fashion.

Other regarding concerns are related to our intrinsic motivation regarding others.  For instance, do we care about others, do we care about what they think of us or do we care about fitting in a social norm? Standard Economics takes into account strategic concerns but disregards social or psychological motivations of our actions. 

Herding refers to the fact that we may choose to ignore our information and ratger follow the behavior of others. In this section, we discuss herding in the context of financial markets an dinformational cascades.

Games of complete information refer to strategic interaction in which no player has informational advantages. Decision-makers are sometimes not acting rationally in those games due to their cognitive limitations. Video

This section discusses games in which parties have different information. Examples include auctions. We present evidence and behavioral models that account for irrational behavior in that setting.

Economists have studied extensively how we use information in strategic settings, how private information can benefit us or hurt us, or how we can influence the decisions of others by shaping the environment that generates information. This section reviews this literature and discusses applications.

Our irrational behavior as adults reveals how certain abilities have not developed through childhood and adolescence. Discovering the developmental trajectory of decision-making can be used to revisit and adapt the environement in which we grow and learn.

Nudges are used to chnage the behavior of people. Several examples are provided in the articles listed here.

What are the causes and consequences of crime? How can behavioral economics shed light on criminal behavior? A few articles of interest are listed here.