BUS456 Behavioral Business Strategy

• Topics

  The course consists of two main parts. The first part introduces core theories and concepts of behavioral economics. The second part will focus on applications of behavioral economics using cases and guest lectures from business, illustrating how modern businesses can utilize insights of behavioral theories.

  A non-exhaustive list of topics include:

  • Choice architecture, status-quo and default effects
  • Loss aversion, Prospect theory, and framing effects
  • Heuristics and biases in consumer and managerial decision-making
  • Time preferences
  • Performance measures, incentives and motivation
  • Decision making under uncertainty
  • Frontiers of behavioral insights. Interaction of behavioral insights with new technologies (e.g. mobile apps and big data possibilities)

• Learning outcome

  Knowledge

  Upon completion of the course the student will

  • Be able to discuss the main theories and insights of behavioral economics that are relevant in a business environment.
  • Be able to assess the different experimental techniques firms can use to test and improve the way they do business.

  Skills

  Upon completion of the course the student will

  • Be able to identify areas of business where insights from behavioral economics are likely to play an important role.
  • Be able to apply insights from behavioral economics to business practices.
  • Be able to reflect upon and critically discuss the application of principles from behavioral economics in the business context.
  • Be able to analyze relevant data to evaluate behavioral business strategies.

  General competence

  Upon completion of the course the student will

  • Improve their ability to write a paper report in a structured and efficient manner.

• Teaching

  Regular lectures including in-class experiments and group discussions. We will post pre-recorded videos of selective content. Please see Canvas for a detailed schedule.

  In addition there will be guest lectures by practitioners of Behavioral Economics from Telecom, Insurance and Tech Companies.

• Recommended prerequisites

  The course is equally suited for students with prior experience in behavioral economics who seek a better understanding of how to apply their knowledge in a business context, as well as for students without prior experience of behavioral economics who are interested in an application-based and business-oriented introduction to the topic.

• Required prerequisites

  None.

• Compulsory Activity

  Pass an individual mid-term test and hand in an empirical problem set where students get experience analyzing real business data provided by our partners (in groups of maximum 4 students).

  The written mid-term test will be held in-class within the normal lecture hours halfway into the course. The test will assess whether students master the main theories and concepts taught in the course thus far.

  The empirical problem set will be an integrated part of the ordinary lectures, with clear instructions and guidance from teaching assistants.

• Assessment

  Group based term paper. Groups should consist of 2 to 4 students.

  The term paper will be released after the last guest lecture in October and students have about 10 days to hand in the paper.

  The term paper must be written in English.

• Grading Scale

  A-F

• Computer tools

  The empirical problem set can be solved using your preferred statical software (e.g. STATA or R).

• Literature

  The students will be provided with selected articles on canvas. We will use articles from the literature in behavioral economics from world-leading journals - such as Nature and Management Science - as well as business-oriented articles, e.g., from the Harvard Business Review and the Journal of Marketing.