Advanced Seminar Economics, Policy & Econometrics: Decisions under Uncertainty from Description and from Experience

People very often make decisions under uncertainty regarding future consequences of their actions and their likelihood. Models in Economics often assume that people have full access to numerical descriptions of such uncertainty. In reality, however, people often inform their decisions from past experience. Recently, research in behavioral economics has demonstrated that the two forms of information: from description and from experience, can lead to very different types of decisions. This seminar provides an overview of the standard methods that Economists use to study decisions involving risk as well as the latest insights and methodology for studying such decision when information is obtained from experience. Participants will work in groups in order to prepare a presentation related to the selected topic as well as to develop a paper thesis where they implement the tools and concepts of decisions from experience in order to augment and/or rexamine the finding in the current literature of the selected topic. Each group will select one of the following, broadly defined, topics: a. Investment decisions b. Tax evasion, cooperation and punishment c. Medical decision making d. Consumer behavior The seminar will equip participants with tools that are commonly applied in Behavioral Economics, such as theoretical modelling and the key principles of experimental methods.

This seminar aims to 1) equip participants with the state of the art concepts of decisionmaking under risk or uncertainty 2) learn important methodological tools from Behavioural and Experimental Economics 3) develop their presentation skills by communicating the most important insights from their selected topic to their classmates. Moreover, paricipants 4) will practice their ability of conducting literature reviews and deriving important research gaps to their topic and summarize both main insights and research gaps. Finally, 5) participants will exercise their ability to think critically by coming up with an idea to further research in the specified area by enriching standard Economics principles with state of the art insights from Psychology.

Participants will work in small groups. The formal requirements of this seminar consist of a. giving a presentation in front of their classmates and b. writing a seminar thesis. For the presentation, participants will select a paper from a range of topics that will be discussed in the introductory lecture. Participants are expected to be able to identify the key points of this paper as well as to communicate and to defend those points in front of a broader audience in an efficient and succinct way. For the seminar thesis, participants will build on the paper/topic they selected for their presentation by exploring how the insights from the "Decisions from Experience" paradigm can be applied to the paper's core thesis. In doing so, they are expected to conduct a literature review, propose a research question and develop a study-design through which this question can be empirically tested. The final grade will be based on the written seminar thesis (70%), but the group presentation of a research topic will allow students to improve their final grade (30%).

Basic understanding of mathematical and statistical principles. Familiarity with microeconomics will be helpful, though not essential.

This module is a seminar. The introductory meeting will discuss the subtopics, and highlight some seminal findings in the area. In the first phase participants will concentrate on learning by reading relevant scientific literature, presenting one topic per group and discussing questions and interlinkages to related topics. In the second phase, students will produce a written paper in which they need to show their understanding of the respective topic, their capability to identify research gaps in the discussed literature as well as their critical thinking in discussing how an established line of research in Economics - related to the topic the group has selected - can be adjusted through the insights of the decisions from experience program.