COURSE OUTLINE (SUMMER TERM-2018)

ECO 506A: BEHAVIOURAL AND EXPERIMENTAL ECONOMICS

Instructor: Dr. Debayan Pakrashi

Faculty Building 607, IIT Kanpur
Email: pakrashi@iitk.ac.in

Department: ECONOMIC SCIENCES

TAs:
 Chitwan Lalji (chitwan@iitk.ac.in)
 Dhiraj Kumar (dhiraj@iitk.ac.in)

DAY/TIME: TWTH: 10:00 - 12:00 hrs (VENUE: L 3)

Course Objective: The aim of the course is to make students familiar with current
research in behavioural economics, including analysis of human behaviour, laboratory
experiments, field surveys, short discussion on neuroscience, and the historical evolution
of the major factors of production. The course should equip students with a sound
heuristic foundation for analysing socio-economic phenomena and give them an
understanding of behavioural approaches used in experimental and development
economics.

Course Structure
Section I:

A Short history of social life: Hunter gatherers to present day society, changes over time,
migration and technology diffusion, geographical advantages, colonization.

Section II:

Circles of power: Different kinds of power groups, examples, how are they linked with
each and how they have evolved over time, group transitions, the genesis of groups,
markets and institutions, spillovers, political influence and pressure groups.

Section III:

Greed: Utility maximization problem, relative income status, the concept of reference
groups, Easterlin paradox, migration, brain drain and corruption.

Section IV

Individual Welfare: Concepts of life satisfaction, mental health, self-assessed health, risk
averseness.
Section V:

Internal Psychology: (Neural Science) The human brain and how it matters for human
behaviour, consciousness, religiosity, greed, altruism.

Section VI:

Application of heuristics to understand dynamic social situations in labour, development

and environmental economics. This section will also focus on the application of
Behavioural Economics in Experimental and Development Economics, with particular
focus on development projects: focussing on the importance of incentives, nudges, peer
effects, social networks in technology adoption and poverty reduction programs.

Reading Materials/Handouts

 The course reading materials/handouts and research papers will be supplied time
to time.
 Frijters, Paul and Foster, Gigi (2013), An Economic theory of greed, love, power,
and groups. Cambridge University Press. (Optional)

EVALUATION

Mid-semester Exam: 30%

End Semester Examination: 40%
2 Surprise Quiz: 20%.
Attendance: 10% (No marks below 75% attendance)

NOTE 1: DOORS WILL BE CLOSED AT 10:10 AM

NOTE 2: Each student will be allotted fixed seat number for regular class
attendance , he/she needs to seat on that particular seat number otherwise he/she
will be marked absent for that day.