Descriptif

Designing experiments to inform economic theory

Laboratory experiments about human decision-making have gained increasing importance in economics. The list of phenomena uncovered by laboratory experiments includes, but is not limited to: bounded rationality (statistical fallacies, learning biases…), motivated beliefs (overconfidence, anticipatory utility…), reference-dependence, dynamic inconsistency… This project will focus on one particular behavioral bias, chosen as a function of students’ interests. We will then review the theoretical and experimental literature on this specific phenomenon, and identify gaps in our knowledge. The project will culminate in an experiment designed and ran by the students (in teams of 2 students) to further advance our understanding of the relevance, importance and/or implications of the bias. The methodology will be based on a back-and-forth between microeconomic modeling (decision theory, game theory) and experimental economics.

Pre-requisites : ECO361 and ECO41031

References: Falk, A., & Heckman, J. J. (2009). Lab experiments are a major source of knowledge in the social sciences. science, 326(5952), 535-538.

Levitt, S. and J. A. List. (2007). Viewpoint: On the generalizability of lab behaviour to the field. Canadian Journal of Economics 40(2): 347-370.

Levitt, S. and J. A. List. (2007). What do laboratory experiments measuring social preferences reveal about the real world. Journal of Economic Perspectives 21(2): 153-174.

Camerer, C. (2011). The promise and success of lab-field generalizability in experimental economics: A critical reply to Levitt and List. Working paper.