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Reader Question: How Do I Become A Behavioral Economics Nerd?

May 25th, 2010 · 11 Comments
Behavioral Econ · Reader Questions

A reader writes:

I’m a grad student at Georgetown University, where I’m in the dual masters in public policy/masters in economics program. As part of that program, I took the first year PhD sequence in the econ department. We used the usual texts for micro, macro, and metrics, but we didn’t really talk about behavioral stuff. I’m a recent new reader of your blog and I like your focus on behavioral economics. My time at Georgetown is limited and the department doesn’t seem to have anybody who’s really doing research in that area so I thought I’d email you and see if there were any books or papers that you would recommend. I’m looking for an overview but also something that allows me to read newer papers and understand the context. From the little I know, it seems like it would be perfect for someone like me interested in policy.

First off, you’re right! Behavioral economics is very relevant to policy, since it’s super helpful to understand how real people think about choices involving money, employment, etc. in order to design effective and efficient regulations and tax systems. I assume based on the context that you’ve given me that you want some academic as opposed to general-interest resources.

The text Choices, Values, and Frames is a compilation of the seminal papers in behavioral economics. It doesn’t really include the most recent work in the discipline, but it’s important to understand the history and foundations and then go from there. (You can always look up newer papers on JSTOR or whatnot.)

As a supplement to that, I swiped for you some of the materials that I had in my first behavioral economics course. Now, this was a number of years ago (gah), but these should still be pretty useful. My class was taught by Matt Rabin, who was visiting Harvard from Berkeley that year (and who, by my count, owns a minimum of 27 tie-dyed t-shirts). I’ve posted his syllabus here. Also, Prof. Rabin was nice enough to make lecture handouts for the course- they have some typos and whatnot, but you’ll probably find them helpful.

My missionary work for the day is now complete. 🙂

Tags: Behavioral Econ · Reader Questions

11 responses so far ↓

  • 1 Justin Ross // May 25, 2010 at 1:26 pm

    I would also recommend to him readings out of the Workshop for Political Theory and Policy Analysis at Indiana University. In particular, Elinor Ostrom’s APSA lecture: http://www.cappp.org/fellows_program/under_graduate_fellows/ostromRationality.pdf

    I would also put Vernon Smith’s research in that same grouping: http://www.amazon.com/Rationality-Economics-Constructivist-Ecological-Forms/dp/0521871352/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1204315626&sr=8-1

    In my opinion, one of the difficulties of behavioral economics is that a lot of people fall in love with it in a way that is kind of inappropriate. I think Ostrom and Smith (both Nobel Prize winners) go a long way in putting it in the proper context.

  • 2 econgirl // May 25, 2010 at 2:34 pm

    Inappropriate? I now feel the need to say that I love behavioral economics like a bored farmer loves his sheep or something like that… =P

  • 3 Justin Ross // May 25, 2010 at 3:31 pm

    lol, I did not mean to implicate you in anyway. In fact, you’ll note that I said “people” instead of “economists.” An important distinction, since economists do not count as people 🙂

    I just meant that people on the outside sometimes get really carried away with some of the results in behavioral economics, especially if they see the traditional models and take them literally instead of seriously. They get caught up in a pop psychology vibe instead of adding it to our larger understanding of social institutions. It’s the classic “know just enough to be dangerous” issue, in my opinion. That’s why I suggested those readings, in complement to the ones you mentioned.

    Best, JR

  • 4 Allison // May 25, 2010 at 3:52 pm

    Although I am not the writer of the above question, I wanted to say thank you. I’m a sophomore majoring in economics and I’ve found behavioral economics to be fascinating. Unfortunately my school also does not offer any focus on this area and I didn’t really know how to get started as far as learning more about it. So, thanks!

  • 5 econgirl // May 25, 2010 at 4:13 pm

    You’re very welcome! =D Let me know if you have any follow-up questions.

  • 6 David // May 25, 2010 at 4:24 pm

    MIT also has lecture notes from a graduate behavioral economics class posted online:
    http://ocw.mit.edu/OcwWeb/Economics/14-127Spring2004/LectureNotes/index.htm

  • 7 mason_anton // May 25, 2010 at 5:29 pm

    Jodi, not to bash your missionary work here but a better response to this dude might have been:

    “Hmm… you’re an econ. grad student at Georgetown and you are having problems finding information on a major field of economics??!? Maybe you should try hitting up the library…”

    Does anyone else find this alarmingly sad? IMHO… It’s one thing if you’re confused with the philosophical or theoretical subtleties of a subject–seeking some insight from academics may be wise; however, the inability to perform basic research is inexcusable.

    Alas, maybe you answering this dude’s question (and thus performing work that he himself should have performed) is merely an extension of your study into behavioral economics.

    Your altruistic tendencies have not escaped notice.

    ~Anton

  • 8 Alex Rodriguez // May 26, 2010 at 1:11 am

    ahhhh Jodi!!!! where was this link 6 months ago?????? I could have really used this input on my senior research paper!! oh well, since that’s over with I will probably read it for fun anyways… cause that’s how I roll yo 😉

  • 9 GVV // May 26, 2010 at 3:42 am

    Only a new psychoanalytic economics could explain”how real people think about choices” and economic actions cannot be studied by oserving behaviour alone; the dark Freudian unconscious also influences choices

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