Econ 119 Syllabus 2021 Fall PDF

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syllabus of 2021 fall semester syllabus of 2021 fall semester...

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Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 1 of 7

Economics 119: Psychology and Economics Course Description: The field of Psychology and Economicswhich we will call Behavioral Economicsis a comprehensive attempt to take the methodology of economic theory beyond the standard assumptions of rationality and self-interest. The goal is to develop models that more accurately describe and predict economic phenomena. The guiding principle is to select modeling assumptions on the basis of psychological realism rather than mathematical or normative convenience. This course is an introduction to the field. The goals of the course are to explore more thoroughly the assumptions, implications, and failures of several fundamental standard economic models;   aa, baa  baed on findings from psychology; and to explore the implications of the new models. By the end of the course you will have a better understanding of standard economic theory, a richer appreciation for the way that economists think, and an interesting set of insights about the ways that human psychology affects economic decision making. As part of Berkeley's Undergraduate Student Learning Initiative (USLI), the Economics Department has developed learning goals for the Economics major. See http://emlab.berkeley.edu/econ/ugrad/ugrad_goals.shtml. The specific learning goals which this course aims to achieve are as follows. CT1: Understand everyday economics problems CT2: Use economic theory to understand and evaluate policy proposals CT3: Compare arguments CT4: Role of assumptions QT1: Understand the role of empirical evidence in evaluating econ omic problems QT2: Interpret results PS1: Solve problems with clear solution CS1: Communicate effectively about economic issues.

Syllabus:

This syllabus contains a lot of important information. If you do not read it carefully, you may run into problems later on, particularly with respect to exams. If something bad happens to you that could have been avoided by reading the syllabus, I will not provide accommodations. If you email me a question that is answered on the syllabus, I will refer you to the syllabus. This is not intended to be harsh or rude. It is just incredibly a    a  ab.

Prerequisite:

The prerequisite for this class is either Econ 100A or 101A. I strongly discourage you from taking this class without the prerequisite. If you wish to do so anyway, please email me first.

Enrollment:

For enrollment questions you must contact the head GSI, John Wiesselthier. His email address is [email protected]. As strange as it may seem, neither I, nor your GSI, will be able to help you with enrollment questions. Note that in order to take this class, you must be able to attend the final exam at the scheduled time. There will be no exceptions to this. If you have an exam conflict with another class, and you cannot get a different exam time from the other instructor, you must drop one of the classes.

My office Hours: I will hold OH on Mondays, 11:301:30. The Zoom link is on bCourses. On weeks with problem sets due, these will be group OH and we will work together on the problem set. On other weeks, this will be one-on-one OH. This is for everything other than problem sets and exam prep: course material, school, career, life, etc. One-on-one OH will be first-come-first-served, using a waiting room. Email: My email address is [email protected]. Feel free to email me about anything you like, but please maintain professionalism in your emai: b ac a  Prof. Acland,  complete words, sentences, and paragraphs, and include your name at the end. Website: Everything will be on bCourses. I will use the class email list to send you information about the class. You are responsible for reading all of every email. If you run into problems that could have been avoided by reading an email more carefully, I will not provide accommodations.

Secion and GSI: Instead of reviewing material in section, the review material and some practice b  b  a    c b a  a GSI. Sc    be used for working on problem sets or additional practice problems. I strongly encourage you to view the videos before attending your assigned section. You may not attend a section other than the one you are assigned to. GSI office hours will be one-on-one, on a first-come-first-served basis.

Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 2 of 7

Online Forum:

We will use Piazza for questions about problem sets and course material. Please post your questions on Piazza instead of emailing them to your GSI. The Q&A will be closely monitored by GSIs. It is fine to email your GSI with administrative questions, but they will redirect you to Piazza if the question concerns course material. If you are not familiar with Piazza, check it out as soon as you can. If you have logistical questions, it is helpful to post them on Piazza. However, if they are answered in the syllabus, you will be directed to the syllabus. Please do not answer logistical questions on Piazza unless you are completely certain of the answer.

Lectures:

There will be a handout for each lecture, which you must download and print so you can take notes. Lecture recordings will be posted as soon after class as possible. There is no textbook for this class and the readings do not cover all of the material on which you will be tested, so lecture attendance and careful note-taking are extremely important. If you do not attend lecture (or watch the videos if you have permission to skip the synchronous lectures), there is no way you will succeed in the class. We will use Zoom polls instead of clickers (i.e. iClicker REEF, TopHat, etc). You will receive points for participation which will count towards your grade, which is another way of saying that attendance is part of your grade. You do not need to answer questions correctly to receive participation . Y  a 3  a on participation, which effectively means you can miss three lectures without hurting your grade. If you cannot attend lecture because of a conflict with another class, email me and I will excuse you from participation points. Use chat only to ask questions. Only GSIs may answer questions on chat. Your camera must be on during lectures, except for short breaks for personal reasons. It has been shown that attention and engagement are higher when students have their cameras on. You having your camera off creates an effect for you, but also for your classmates. If you are concerned about people seeing your environment, use a background. If your computer or connection prohibit you from using a background, I will excuse you from this requirement if you send me a screen shot of the problem. Concern about physical appearance is not an acceptable reason to have your camera off. You should expect to put as much effort into your physical appearance for a remote class as you would for an in-person class. If you have any other strong reason to need your camera off, please let me know. If your camera is off and you have not been excused, one of the GSIs will remind you of the requirement via chat.

Technology:

You will need access to a printer, and you will need to be able to scan problem sets to pdfs. (There are apps that do this using the camera on your phone.) Not being able to make a pdf of your problem set will not be accepted as an excuse for a late problem set.

Readings: The required readings are listed in the course outline below. They are all from academic journals, so they may be somewhat advanced in places. If readings contain sophisticated economic models, I will typically teach simplified versions of them, and the problem-solving portions of the exams will be based on these simplified versions. All assigned readings will be posted in pdf format on bCourses, and you should use these versions because in some cases I have annotated them to indicate portions that are not required (marked with a solid red line in the left margin) and portions that are required, but that you do not need to read as carefully (marked with a dashed red line in the left margin). Please do not redistribute these pdfs for any purpose. Doing so will violate copyright law. In addition to the assigned readings, I have posted on bCourses any articles that are mentioned in the lectures. These are not required, but most of them will be relatively easy to read, fun (if you are into cool experiments), and will help you understand concepts from lecture that you will be tested on. Finally, for curiosity and entertainment, I recommend the following: Thaler's The Winner's Curse: Paradoxes and Anomalies of Economic Life, a collection of great and easy-to-read articles; Ariely's Predictably Irrational, a psychologist's perspective on the topics; Thaler and Sunstein's Nudge: Improving Decisions about Health, Wealth, and Happiness, which discusses some public policy implications; a Ta Misbehaving, which is a very entertaining memoir of his long and superb career in behavioral economics. These are all available on Amazon.

Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 3 of 7

Problem sets:

There will be six problem sets. Deadlines are on bCourses. Solutions will be available on bCourses shortly after the deadline. The problem sets have three purposes: 1) to help you understand the material from lectures and readings more thoroughly; 2) to extend what you learn in lectures and readings into new topics; 3) to give you practice with the kinds of problem solving and questions you will face on exams.

I strongly encourage you to join a study group (there is a post on Piazza about how to do so), but each student must be involved in solving each problem..   a cand each student must write their own answersi.e. no copying of any part. I strongly encourage you to attempt each problem on your own before meeting with a group. Excellent exam scores will require that you be able to tackle problems you have not seen before, and the best way to prepare for this is to try as hard as possible to solve the problem sets on your own. For full disclosure, the problem sets will largely be re-used from prior years, and as such many students will be able to access the solutions. Those students will be at a disadvantage because they will be tempted to use the solutions to help them solve the problem sets, and if they do, they will learn less and score lower on exams. Trust me on this; we see it over and over again. You are much better off not using the solutions until after turning in the problem set. Late problem sets will not be accepted without a documented excuse. Your lowest problem set will be dropped.

Exams: There will be two midterms and a final. The final will be cumulative, but biased towards the final third of the course. Exams will consist of some problems quite similar to those you have seen on problem sets, and some problems that will be less familiar to you. To receive an excellent score on the exams you will need to be able to tackle the less familiar problems. You will not be rewarded for effort on exams. There are no make-up exams. If you miss a midterm you must contact me before the exam with an excuse that meets University standards.1 Please be prepared to provide whatever documentation is necessary to support your excuse. I will give you an additional assignment. If it is completed satisfactorily, your other exams will be reweighted. If you do not have an appropriate, documented excuse, or if you do not complete the alternative assignment satisfactorily, you will receive a zero for the midterm. If you miss the final with an excuse that meets University standards you will receive an incomplete for the course and will be required to take the final for the course during the following year in order to get credit for the class. Please take the necessary steps to ensure that you do not have travel plans that conflict with the final as this will not be considered an acceptable excuse for missing the final. Cheating on a midterm or the final will result in an F for the course. Incidences of cheating will be reported to the Center for Student Conduct, which may administer additional punishment.

Grading: Your grade will initially be weighted as follows: Poll participation, 5%; Problem sets, 20%; Midterms, 25% each; Final, 35%. These numbers total 110%. The weight for your weakest exam (the one on which you rank lowest) will then be reduced by 10% so that the weights will total 100%. For example, if your final is your weakest exam it will count for only 25% of your grade. Grader omissions or clerical errors on exams will be corrected upon request. Substantive re-grade requests for midterms must be submitted to me in writing within one week of getting your graded exam back. Your entire exam will be regradedby meand your grade may go up or down. I will not read any comments you may make about why you think you deserve additional points on specific questions, but I will grade carefully in order to catch anything GSIs may have gotten wrong. There will be no re-grades on problem sets. The Grades tab in bCourses will tell you your scores on problem sets and exams but it will not be used for computing your score or letter grade for the class. Do not draw any conclusions about your final score or letter 1

Religious holidays must be recognized by the University or accompanied by a letter from a religious leader. Schedules for official team events must be provided to me by the end of the second full week of the semester. A death in the family must be documented. Illness or injury must be accompanied by a note from a physician or clinic, on their letterhead. Please note that extreme stress and other psychological symptoms can count as a legitimate medical excuse. The Tang Center can provide you with documentation.

Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 4 of 7

grade from the information on bCourses. It is absolutely not the case that, for example, a score of 90% will earn you an A. You cannot infer your letter grade from the information on bCourses.

Honor code: The ASUC asks that faculty include the following language in their syllabuses: T  c a UC B a a   H C: A a b   UC B c, I ac  , , a c  . T  a ca  a   a   c. This is an admirable aspiration, but   c  a     a , , a c   a a. H a . If even a small voice within you a I   a   students, my parents, or my professor t  ab , stop! And ask yourself what matters more, the shortterm gain you were about to grab, or the respect of others, your own self-respect, and the honor of your family, all of which must be earned and jealously guarded over the long term.

Letters of Recommendation for Graduate School: Some of you will decide to go on to graduate school. A crucial factor for many programs is strong letters. You must be proactive and forward-thinking to ensure strong letters. One of the most important ingredients of a strong letter is how well the professor knows the student. In a large class like this you must take proactive steps to get to know me well enough for me to write you a strong letter. The best way to do this is to participate during lecture and come to my office hours to discuss topics from the course and potential research ideas. It will also help if you discuss your future plans with me.

Asking for Help: Feel free to approach me about anything that is affecting your learning or your academic success. You are unlikely to have any difficulty that has not been shared by thousands of students before you, including, in most cases, myself. Everyone needs help. Embarrassment, shame, and fear are not good excuses for not getting help. Here are some useful links to on-campus resources. x

Student learning center:

slc.berkeley.edu

x

Econ tutors

www.econ.berkeley.edu/undergrad/home/tutoring

x

Dab S Pa:

dsp.berkeley.edu

x

Counseling (Psychological, Psychiatric, Social Services, and Career Counseling):

https://uhs.berkeley.edu/counseling

Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 5 of 7

Outline of Lectures, Readings, and Exams: Introduction x

Lecture 1

Th Aug 26 Introduction

No Reading Reference Dependence x

Lecture 2

Tu Aug 31 Consumer demand theory and the endowment effect

01 Kahneman, Knetsch, and Thaler (1990) Experimental Tests of the Endowment Effect and the Coase Theorem x

Lecture 3

Th Sep 2

Reference Dependent Preferences

02 Kahneman, Knetsch, Thaler (1991) Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias x

Lecture 4

Tu Sep 7

Normative Implications of Reference Dependence

03 Knetsch (1992) Preferences and Nonreversibility of Indifference Curves x

Lecture 5

Th Sep 9

Normative Implications of Reference Dependence Cont.

04 Knetsch (1989) Environmental Policy Implications of Disparities between WTP and WTA 05 List (2003) Does Market Experience Eliminate Market Anomalies? x

Lecture 6

Tu Sep 14

Applications of Reference Dependence

06 Rabin (2000) Risk Aversion and EU Theory Calibration 07 Benartzi, Thaler (1995) Myopic Loss Aversion and the Equity Premium. x

Lecture 7

Th Sep 16

Reference-Dependent Preferences in Labor Supply, and ReferencePoint Determination

08 Goette, Fehr and Huffman (2004) Loss Aversion and Labor Supply Midterm 1 x

Review

Tu Sep 21

x

Exam

Th Sep 23

Econ 119, Fall 2021 Instructor: Dan Acland

August 26, 2021 Syllabus, page 6 of 7

Intertemporal Preferences, Beliefs, and Predictions x

Lecture 8

Tu Sep 28

Exponential Discounting Theory and Anomalies

09 Fc, L, a OD (2002) Time Discounting and Time Preference: A Critical Review x

Lecture 9

Th Sep 30

Present-Biased Preferences and Quasi-Hyperbolic Discounting

09 Fc, L, a OD (2002) Time Discounting and Time Preference: A Critical Review x

Lecture 10 Tu Oct 5

Beliefs about Future Intertemporal Preferences

10 OD a Rab (1999) Doing it Now or Later x

Lecture 11 Th Oct 7

Sophistication and the Two-Self Model

11 McClure et al (2004) Separate Neural Systems Value Immediate and Delayed Monetary Rewards 12 Thaler, Shefrin (1981) An Economic Theory of Self-Control x

Lecture 12 Tu Oct 12

Misprediction of Self-Control and Demand for Commitment Devices

13 DellaVigna, Malmondier (2006) Paying Not to Go to the Gym 14 Acland, Levy (2014) Naivete, projection bias, and habit formation in gym attendance 15 Ariely, Wertenbroch (2002) Procrastination, Deadlines, and Performance x

Lecture 13 Th Oct 14

Aca, Pc Ica, a Na Ica  ,

16 Shapiro (2004) Daily Discount Rate State-Dependent Preferences and Projection Bias x

Lecture 14 Tu ...