Behavioural Economics: Concepts, Tools and Applications

This course will provide an introduction to the methods used in behavioural economics. After an introduction to the basic concept of an experimental approach and why it may be needed to enable government and researchers to evaluate policy interventions, this course will explain the foundations of causal analysis, discuss important statistical concepts relevant for design and implementation of randomised controlled trials. Laboratory experiments, basic statistical methods needed to analyse trial data and provide examples and applications will also be examined. Special emphasis will be put on the ingredients that are needed to run an effective and informative randomised controlled trial

Course overview

The course will provide participants with the knowledge they require to understand general concepts of behavioural economics and to apply basic statistical tools to trial design, implementation and data analysis. The course will combine intuitive explanations with practical examples. It will involve basic mathematical and statistical concepts that will be explained as part of the course. The course is suitable for beginners and as a refresher for those with a basic statistics background.

The workshop will cover six main topics:

• General concepts of behavioural economics
• Statistical concepts
• Basic econometric tools
• How to develop a randomised controlled trial
• Natural, laboratory and field experiments: evaluation methods of behavioural economics
• Randomisation and methodological issues
• Data analysis: examples and applications
• Lab experiments: examples and applications

The first day of this course will give an introduction to some general concepts of behavioural economics, provide an overview of important statistical concepts and discuss practical challenges related to trial design and implementation. The second day will provide an introduction to important econometric tools required to analyse experimental and non-experimental data and discuss examples and applications.

Learning outcomes:

• Ability to identify policy problems that lend themselves to behavioural economic interventions.
• Sound ability to develop interventions and an evaluation strategy.
• Sound understanding of quantitative methods used to evaluate the effectiveness of behavioural economic interventions.
• Awareness of empirical, ethical and political limitations of the approach.

Anticipated behavioural and business impacts include:

• A better understanding of behavioural economics, including the need to randomise, the challenges associated with trial design and implementation.
• A better understanding of basic statistical and econometric concepts relevant for the analysis of trial data.
• A better understanding of alternative approaches that may be used to study human behavior or evaluate public policies (including natural and laboratory experiments).