Economic models make several simplifying assumptions about human behavior. All the standard economic prescriptions for pricing, output choice, long term investment, managing competition in oligopolies, etc flow from these assumptions. Through cases, experiments, and formal modeling, students will learn how the optimal strategies of profit-maximizing firms are affected by the recognition that psychological phenomena influence the decision-making of consumers and other market players. The course will involve a significant degree of formal modeling, and will build on core concepts from economics, including individual preferences, decision under risk, monopoly pricing, market behavior, game theory, and strategic bargaining. The course will build on economic reasoning and techniques covered in MECN 430 (Microeconomic Analysis).
All Students: MECN-430-0