AØKA08166U Behavioral Economics and Finance

Volume 2014/2015
Education

MSc in Economics

Content

Traditional economic theory assumes that economic agents are fully rational with unlimited cognitive abilities and willpower. However, individuals frequently and systematically make decisions in contradiction with these standard presumptions. Against the background of this finding the course addresses e.g. the following questions:

What are the shortcomings of traditional theories in economics and finance?
How do the new concepts / theories in behavioral finance and behavioral economics address these shortcomings?
How do these new theories relate to the traditional theories and what are their strengths and limitations?
How do the new behavioral presumptions in behavioral finance and economics change the predictions of classical economic theories?

With regard to the organization of the course: In the first week of the course there will be an opening lecture during which also all organizational issues are discussed. In all the following weeks there will be 2-hour lectures on different topics in behavioral finance and economics. Furthermore, there will be one assignment during the course. More specifically, there will be an assignment with exercises which has to be handed in the second part of the course.

Learning Outcome

Content Level: The course in Behavioral Finance and Economics aims at introducing students to the field of behavioral finance and economics. Traditional economic theory assumes that economic agents are fully rational with unlimited cognitive abilities and willpower. However, individuals frequently and systematically make decisions in contradiction with these standard presumptions. During this course students should understand how behavioral finance and economics attempts to understand these systematic behavioral departures from standard economic theories. Furthermore, it should (i) provide an in-depth overview of the most important seminal works in these two areas and (ii) make students aware of the impact and relevance of the new concepts and theories presented in these seminal works.

Methodological level: Students should learn to critically assess and relate the new concepts and the supporting empirical evidence put forward in the hitherto existing seminal works in behavioral finance and behavioral economics. Furthermore, they should learn how to present these new and often complex concepts in a simple / clear, but not superficial way.

A list of required readings will be given to the students in the beginning of the course

A sound knowledge of microeconomics and game theory is required.
3 hours of lectures per week for 14 weeks.
  • Category
  • Hours
  • Exam
  • 2
  • Lectures
  • 42
  • Preparation
  • 162
  • Total
  • 206
Credit
7,5 ECTS
Type of assessment
Written examination, 2 hours under invigilation
2 hours written exam taking place at Peter Bangs Vej 36.
Exam registration requirements

Two assignments must be approved for students to be able to sit the exam.

Aid
Without aids
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censurship
Exam period

Will be updated before the start of the semester

Re-exam

Same as ordinary. But if only a few students have registered for the re-exam, the exam might change to an oral exams with a synopsis to be handed in. This means that the examination date also will change.

Criteria for exam assesment

The Student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.