BUS456 Behavioral Business Strategy
The course will contain two main parts. The first part introduces core theories and concepts of behavioral economics of the firm and customer. 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, mental accounting and framing effects
- Heuristics and biases in consumer and managerial decision-making
- Time preferences
- Performance measures, incentives and motivation
- Decision making under uncertainty
- Financial decision making, contract design and bargaining
- Frontiers of behavioral insights. Interaction of behavioral insights with new technologies (e.g. mobile apps and big data possibilities)
Knowledge - upon completion of the course the student will
- Have an understanding of the main insights of behavioral economics that are relevant in a business environment.
- Have knowledge about 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.
General competence - upon completion of the course the student will
- Improve their ability to communicate and persuade using sound arguments based on knowledge of applied behavioral economics.
- Improve their ability to write a paper report in a structured and efficient manner.
Regular lectures including in-class experiments.
Guest lecturers from the business community and The Choice Lab at NHH.
Short public speaking workshop combined with an in class debating exercise around the topics of the course.
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.
No special prerequisites.
Requirements for course approval
Half way into the course (after the core part), a 2-hour test will be held (within the normal lecture hours). In this test, there will be questions aiming at testing whether students master the main theories and concepts taught in the course thus far. No books/articles are allowed during the test. Those who pass and get course approval will then be allowed to hand in the group-based term paper.
Group based term paper. Groups should consist of maximum 3 to 4 students.
The term paper should be written in English.
Grading scale A-F
We will occasionally use MobLab for in-class experiments.
The students will be provided with comprehensive slides and 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.
Autumn. Not offered autumn 2018. Due to unforeseen circumstances, we can not offer the course in the autumn of 2018.
Dr. Lars Ivar O. Berge, Department of Accounting, Auditing, and Law and Dr. Thomas de Haan, Department of Economics, NHH.