Behavioral Business Strategy

BUS456 Behavioral Business Strategy

  • Topics

    Topics

    The course contains two main parts: (i) behavioral economics within the firm, and (ii) behavioral economics and customer relations. Part (i) introduces students to a broad variety of applications of behavioral economics within the firm. In particular, students will get an overview of the role of behavioral principles in bargaining situations, contract design, and decision-making processes in groups. Furthermore, they will learn about the implications of behavioral aspects in performance measurement and incentive structures within the firm. Part (ii) focuses on principles from behavioral economics that are relevant with respect to customer relations. We will discuss how context-dependent preferences, loss aversion, and framing effects influence the customers' purchasing decisions, and how businesses can benefit from this knowledge to design successful product differentiation and pricing strategies.

  • Learning outcome

    Learning outcome

    In this course, students will get an overview of the variety of applications of behavioral economics in the context of strategic business decisions. An important aspect of this course is to connect the insights from behavioral economics to established management tools. Notably, we will connect with management tools as introduced in the courses BUS400 and BUS401 and complement the insights from these courses with insights originating from behavioral economics. Combining insights from economics, psychology, and marketing, behavioral economics provides a valuable framework to understand consumer choice and to improve decision-making processes within the firm. In a world where more and more businesses are applying behavioral economic principles and are narrowing the gap between behavioral scientific knowledge and business practices, the insights we provide in this course will be valuable for the toolbox of the business professional of the future.

     

     

    After completing the course, the students will:

    • Have an understanding of the main insights of behavioral economics that are relevant in a business environment.
    • Be able to identify potential applications of principles from behavioral economics in business cases.
    • 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 communicate and present their knowledge regarding the application of certain principles of behavioral economics in a structured and efficient manner.
    • Have knowledge about different experimental techniques that can be used by firms to test and improve the way they do business.

  • Teaching

    Teaching

    Regular lectures including in-class experiments.

    Guest lecturers from the business community and The Choice Lab at NHH.

  • Required prerequisites

    Required prerequisites

    No special 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.

  • Requirements for course approval

    Requirements for course approval

    There will be 2 case-based group assignments (approved/not approved).

  • Assessment

    Assessment

    Written examination 4 hours (school exam 100%).

    The exam can only be written in English.

  • Grading Scale

    Grading Scale

    Grading scale A-F

  • Computer tools

    Computer tools

    We will occasionally use MobLab for in-class experiments.

  • Semester

    Semester

    Autumn

  • Literature

    Literature

    The students will be provided with comprehensive slides and a compendium of selected articles on itslearning. 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.

Overview

ECTS Credits
7.5
Teaching language
English
Semester
Autumn

Course responsible

Lars Ivar O. Berge, Department of Accounting, Auditing, and Law and Dr. Thomas de Haan, Department of Economics, NHH.