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Behavioural Economics and the Modern Economy
Intensive programmes for visionary thinkers, in the heart of London
Engage with world-class LSE teaching faculty
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Behavioural Economics and the Modern Economy
Get up to date with modern developments in behavioural economics.
This course provides a clear statement of the thoughts behind behavioural
economics and implications for both firms and regulators. It will draw on
psychological and experimental research, as well as formal economic
models. An essential course for those who have read about nudges or
biases in the popular press but want a more disciplined understanding
before applying it to their sector.
What you will gain from this course?• Understand the heuristics and biases
that characterise key aspects of human decision making.
• Gain an overview of people’s social, risk and time preferences. In particular, how a better understanding of imperfect self-control and loss aversion have revolutionised economic debates in the past decade.
• Build a deeper understanding of the foundations of behavioural finance and some of the anomalies in financial markets.
• Acquire knowledge to help navigate some of the new regulatory solutions that behavioural economists advocate, and also the possibilities and limits of libertarian paternalism.
Core course content:The course begins with an overview of rationality and the behavioural economics approach, and invites participants to discuss the problems and applications they are particularly interested in. We discuss how people make decisions over time, followed by how they choose in risky situations with particular application to insurance markets. We then examine the importance of fairness concerns to economic behaviour. We will look at how all of these factors affect financial markets, and conclude by discussing the new toolbox of regulatory responses to behavioural consumers.
• Behavioural Finance: Trade, Insurance and Risk Perceptions.
• Planning over Time: Procrastination, Credit Markets, Housing, Saving and Retirement.
• Limited Social Rationality: Winner’s Curse, Social Learning, Defensive Medicine.
• Libertarian Paternalism, Nudges.
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“A very well organised programme. I enjoyed the academic nature of this particular course. Teaching staff were very knowledgeable, friendly and approachable.”European Investment Communications Manager, Capital International Ltd, UK
Is this course for you? This executive course is suitable for:
• Professionals in the business and financial sector.
• Policy practitioners interested in applying behavioural insights to public policy.
How is the course taught?The course will draw on psychological/experimental research as well as formal behavioural economic models.
Optional Assessment:Students will be assessed 50 per cent based on group work and 50 per cent based on the optional final written examination.
Course pre-requisites: Basic knowledge of Microeconomics.
Job roles of previous participantsChief EconomistPortfolio ManagerSenior Manager, Competition and Regulatory StrategyInvestment ManagerGroup Chief Risk OfficerHead of Customer InsightsInvestment managerFinance DirectorProject ManagerEconomic analystAsset ManagerHead of Research
From employers includingAMPBayer SASBermuda Monetary AuthorityNetherlands Authority for the Financial MarketsNational Bank AustraliaUBS Financial ServicesXstrata Canada CorporationSaudi Industrial Development FundUnited BiscuitsThe San Francisco FoundationHSBCEuropean Central Bank
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Behavioural Economics and the Modern Economy
Programme fee: £5,795
This includes all course materials, refreshments, daily lunches, receptions and the programme dinner unless mentioned otherwise.
Discounted rates at two local hotels are available to participants.
Full terms and conditions:
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Course Schedule
Day one:• The psychology and economics of
choices over time: temptation andself-control
• Understanding “present bias”,procrastination, and default effects
• Sophistication and the demandfor commitment
• Applications to housing, health,savings, and retirement.
Evening welcome reception
Day two:• Introduction to field experiments and
impact evaluation
• Incorporating behavioural economicsinto field trials
• Integrating continuous evaluation intodiagnosis, design, and delivery.
Day three:• Social preferences and pro-social
behaviour
• How firms and consumers navigatemarket and non-market norms
• Risk perception: salience, heuristicsand biases
• Applications of the gambler’s fallacy,hot-hand fallacy, and other limited orbiased inference problems.
Day four:• Prospect theory: behaviour under
risk and loss-aversion
• Understanding reference-dependentpreferences, risk-framing, andchoice bracketing
• Applying prospect theory toinsurance and investment behaviour.
Day five:• Behavioural finance: inefficient
markets and the limited to arbitrage
• Exploring biases among individualand institutional investors
• Nudges, well-being andbehavioural policy: the role ofmarkets and regulators.
A final timetable and any pre-course reading will be provided prior to the start of the course. Topic areas are delivered in the form of case studies for review, discussion and theory application.
All course content is correct at the time of production and can be subject to change.
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World-class facultyThe Department of Economics at LSE is one of the largest and most famous
in the world. It is a leading research department, consistently being ranked
in the top 20 economics departments worldwide. Course teachers are drawn
from the full time staff of the Department of Economics at the London School
of Economics and Political Science.
Dr Matthew Levy
Dr Matthew Levy is a Lecturer in Economics at LSE whose work focuses on applications of Behavioural Economics to Public Finance and Health Economics. He earned a BSc in Economics from MIT and a
PhD in Economics from the University of California, Berkeley. He recently served as a Robert Wood Johnson Foundation Scholar in Health Policy Research at Harvard University.
Professor Erik Eyster
Erik Eyster is a Professor of Economics at LSE. His research examines the role of limited strategic inference and social learning on the economy and financial markets. He holds a Phd in
Economics from the University of California, Berkeley and a BA from Columbia University.
Professor Nava Ashraf
Nava Ashraf is a Professor of Economics at LSE, and Director of Research of the Marshall Institute for Philanthropy and Social Entrepreneurship. Professor Ashraf’s research combines
psychology and economics, using both lab and field experiments to test insights from behavioural economics in the context of global development in Africa, Latin America, and Southeast Asia.
“I chose LSE for it’s reputation as one of the most well-known research schools in Europe.”Director General Economic and Financial Affairs, European Commission, Portugal
Why LSE for your executive education needs?
A history of excellenceFounded in 1895 with the purpose of academic engagement with real world issues, LSE enjoys a reputation as one of the world’s best universities in the social sciences field.
Talented global participantsOur reputation for innovative and intellectually challenging courses is the reason why fast-track and senior executives from a diverse range of organisations attend LSE education courses.
World-class facultyCourse are taught by full-time LSE faculty who lead their field and augmented by senior practitioners drawn from industry and business our lecturers will engage, challenge and equip you with the latest knowledge and skills.
Certificate of Excellence in Global BusinessOur courses are affiliated with the Global Network for Advanced Management (GNAM), and our courses can be taken as part of the network’s Certificate of Excellence in Global Business.
For course information:
+44(0)207 849 4615(Mon – Fri: 9.30am to 5.30pm)
Executive Education Courses OfficeHoughton Street lse.ac.uk/exec
Behavioural Economics and the Modern Economy