The proposed course is an introduction to the theory and practice of experimental economics, with a special focus on the behavioral analysis of
1. individual (and interactive) decision making under risk and ambiguity; 2. risk, time and social preferences; 3. behavioral finance.
Since the ultimate goal is to design and run economic experiments, we shall complement the review of the existing experimental literature on these themes with a survey on methodological and design issues, together with a review of some popular statistical tools used to analyze behavioral data.
Experimental Economics offers an alternative data collection method to standard empirical methods in Economics that is directly designed to study specific research questions. In the practice of Experimental Economics the data collection process is under full control by the researcher, who can fine-tune the characteristics of the economic environment under scrutiny (incentives, dissemination of information, context and framing, etc…) to his or her own purposes. The methods of Experimental Economics rely on carefully controlled designs, in ways similar to Experimental Psychology or Experimental Physics. However, the ability to control for unwanted influences and unobserved phenomena is much weaker in the social than in the natural sciences, and in this course we will discuss the limits of our ability to construct an ideal social science experiment. Students will be introduced to discussions about both the power and the limitations of Experimental Economics as a data collection method, and to discoveries that have spurred a deeper interest in individual and collective behavior. Students will practice the methods taught by reviewing published papers and designing their own experiment. At the end of the course the students should be able to answer the following questions:
Part I: Theory Ia. Experimental Economics: an Historical Overview Part II: Experimental Design
IIa. Hypothesis testing vs "free-form" experiments IIb. Setting up the experimental environment IIc. Matching IId. Instructions IIe. Economic incentives IIg. Computerized experiments: the Experimental lab IIh. Computerized experiments: Software programming IIi. Computerized experiments: Experiments on the (Inter)net
Part III: Session Planning
IIIa. Recruitment IIIb. Setting up a session IIIc. Conducting the experiment
Part IV: Writing up
IVa. Reading and analyzing the experimental data IVb. Presenting the results
The final grade in the second evaluation period is EXCLUSIVELY given by the grade obtained in a retake exam (with theory and practice questions) about the whole content of the course. Grades from continuous assessment, if any, will not be taken into account.