Behavioral Economics (ECON 312)

2023 Fall
Faculty of Arts and Social Sciences
Özgür Kıbrıs,
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Formal lecture,Interactive lecture
Interactive,Learner centered,Communicative
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The course is based on a set of questions or puzzles related to economics, and then discusses their importance. The course also involves some instructive quick experiments to illustrate how individuals' behavior deviates from the standard model. These experiments make students effortlessly identify the systematic deviations from the standard theory and understand the limitations of the existing models. Behavioral models that use insights from psychology are introduced to explain the puzzle and applied to illustrate new insights and predictions with a debate about the weaknesses of behavioral models.


i) Introduce students with the basic concepts of behavioral economics and how they are motivated by real-life data, ii) Introduce students to the use of basic behavioral models in making predictions about human behavior in economic environments


  • Relate real-life situations to the formal models seen in class
  • Use behavioral economics concepts correctly
  • Construct and analyze simple economic models involving behavioral components


1. Understand the world, their country, their society, as well as themselves and have awareness of ethical problems, social rights, values and responsibility to the self and to others. 4

2. Understand different disciplines from natural and social sciences to mathematics and art, and develop interdisciplinary approaches in thinking and practice. 5

3. Think critically, follow innovations and developments in science and technology, demonstrate personal and organizational entrepreneurship and engage in life-long learning in various subjects; have the ability to continue to educate him/herself. 5

4. Communicate effectively in Turkish and English by oral, written, graphical and technological means. 5

5. Take individual and team responsibility, function effectively and respectively as an individual and a member or a leader of a team; and have the skills to work effectively in multi-disciplinary teams. 3

1. Develop knowledge of theories, concepts, and research methods in humanities and social sciences. 5

2. Assess how global, national and regional developments affect society. 2

3. Know how to access and evaluate data from various sources of information. 4

1. Provide constructive analysis of economic phenomena at the national and international level, and interactions between the two. 5

2. Develop an understanding of organizations and institutions in the society as well as their influence on the economy. 3

3. Recognize how incentives shape the behavior of individuals and organizations. 5

4. Identify "economic" problems and propose alternative models and/or design and conduct research to provide viable solutions using theoretical tools and/or quantitative methods. 3

5. Communicate problems and solutions to managerial and policy decision-making units as well as to lay audiences. 5


  Percentage (%)
Final 45
Midterm 35
Quiz 15
Participation 5



Primary Reading:

Cartwright, Edward. Behavioral economics. Routledge, 2018.

Secondary Reading:

Kahneman, Daniel. Thinking, fast and slow. Macmillan, 2011.

Advances in Behavioral Economics, (2004) by Colin Camerer, George Loewenstein, and Matthew Rabin 2004.

Rational Choice in an Uncertain World: The Psychology of Judgment and Decision Making (2001) by Reid Hastie and Robyn M. Dawes

Psychology of Judgment and Decision Making (1993) by Scott Plous

Behavioral Game Theory (2003) by Colin Camerer,

Choices, Values, and Frames (2000) by Daniel Kahneman and Amos Tversky

Handbook of Experimental Economics (1997), by John Kagel and Al Roth.

Behavioral Law and Economics (2000), by Cass Sunstein

Advances in Behavioral Finance (2005), by Richard Thaler