Behavioural Economics and Experiments addresses key topics within behavioural economics, exploring vital questions around decision-making and human nature. Assuming no prior knowledge of economics, the book features wide-ranging examples from literature, film, sport, neuroscience and beyond.
Ananish Chaudhuri explores the complex relationships between human behaviour, society and decision-making, introducing readers to the latest work on heuristics, framing and anchoring, as well as ideas around fairness, trust and social norms. The book offers a fresh perspective on issues such as:
- Decision-making under uncertainty
- Firms’ pricing decisions
- Employment contracts
- Coordination failures in organizations
- Preventing bubbles in financial markets
This is an ideal introduction for students of behavioural economics, experimental economics and economic decision-making on economics, public policy, psychology and business-related programmes, and will also be accessible to policymakers and curious laymen.
Table of Contents
1 How we decide
2 Experiments in behavioural economics
3 Gut feelings and effortful thinking
4 Expected utility theory and prospect theory
5 Probabilistic thinking
6 Thinking strategically
7 The ultimatum game
8 Market implications of the ultimatum game
9 Trust and trustworthiness in everyday life
10 Trust and trustworthiness in markets
11 Cooperation in social dilemmas
12 The carrot or the stick: Sustaining cooperation in social dilemmas
13 I will if you will: Resolving coordination failures in organizations
14 Behavioural analyses of markets
15 Asset bubbles in markets
Ananish Chaudhuri is Professor of Experimental Economics at the University of Auckland. He has taught at Harvard Kennedy School, Wellesley College, Rutgers University and Washington State University.
"Filled with real world examples ranging from sports to politics and backed by experimental evidence, this book takes the reader on a wonderful journey examining human behavior, individual and collective decision making, trust, fairness, cooperation and competition. Chaudhuri is a gifted writer, and the book will be treasured by experts in the field as well as those who would like to learn more about behavioural economics."
Iris Bohnet, Albert Pratt Professor of Business and Government, Academic Dean, Harvard Kennedy School, Author of "What Works: Gender Equality by Design"
"I strongly recommend this clear, lively and engaging book to all readers, including those without any training in economics, who want to understand how real people decide how much to trust others in everyday life."
Paul Seabright, Director, Institute of Advanced Study in Toulouse, Author of "The Company of Strangers" and "The War of the Sexes"
"This is an extremely absorbing book covering key topics in behavioural and experimental economics, but with applications and anecdotes that go far beyond economics. The book provides an excellent overview of the field and its most recent developments. It is an indispensable source of inspiration for the researcher and a treasure trove of examples for the teacher."
Martin Kocher, Federal Minister for Labour, Family and Youth, Government of Austria
"Chaudhuri has written an extremely readable introduction to experimental economics. This is perfect for advanced undergrads or graduate students who want to learn about state-of-the-art research without being smothered by technical details."
David J. Cooper, Brim Eminent Scholar in Economics and Director of XS/FS, Florida State University, Former Co-Editor, Experimental Economics
"This book is a perfect introduction to behavioral and experimental economics and fills a much needed niche for the classroom. Ananish Chaudhuri is a gifted author whose conversational writing style is easily accessible for undergraduates, yet detailed enough to use as an introduction for graduate students. He motivates each topic with engaging real-world examples before discussing related research. It’s a fun book to read and students will certainly enjoy it. Highly recommended."
James Murphy, Rasmuson Chair in Economics, University of Alaska, Anchorage, Affiliate Faculty, Economic Science Institute, Chapman University