The Wharton School of the University of Pennsylvania is the business school of the University of Pennsylvania, a private Ivy League university located in Philadelphia. Wharton was established in 1881. It is the first business school in the United States.

MBA Behavioral Economics syllabus

Course Description: Behavioral economics applies insights from psychology to the study of
economic phenomena. This course will take the possibility of deviations from rational, selfinterested
behavior as a starting point, and explore two main questions: How does psychology play
out in markets, where sophisticated and unsophisticated consumers and firms interact and
compete? And what does behavioral economics imply for public policy?

Markets have the potential to protect consumers from their biases, when firms compete to give
biased consumers the best deal. in addition, markets allow for the emergence of informational
intermediaries that give biased consumers advice. We will examine whether and how competition
is a miracle remedy, in a diverse array of markets.

Behavioral economics also affects what governments should do and what governments actually
do, when they address market failures, combat poverty and inequality, and raise revenue. This
course therefore also explores “Behavioral Public Finance” – optimal policy in the presence of
biases – and “Behavioral Political Economy” – how biases affect the choices of politicians and
regulators themselves.

Reading: The main text for this course will be Policy and Choice: Public Finance through the
Lens of Behavioral Economics, William Congdon, Jeffrey Kling and Sendhil Mullainathan, Brookings Institution Press 2011.

General (optional) background sources:

1. Matthew Rabin, "Psychology and Economics," Journal of Economic Literature 36, 11-46,
March 1998. Psychology and Economics on JSTOR
2. A public economics textbook. I recommend Gruber, Public Finance and Public Policy.
3. A behavioral economics textbook. I recommend the ones by Cartwright, Behavioral
Economics or Angner, A Course in Behavioral Economics.
4. Two other books are recommended and available at the Penn Bookstore: Nudge by Cass
Sunstein and Richard Thaler, and Thinking Fast and Slow by Daniel Kahneman.

The Wharton School MBA Behavioral Economics syllabus









Contact address

The Wharton School
Business School
3730 Walnut St, Philadelphia, PA 19104, United States