Introductory description

This module addresses growing interest among policymakers, social scientists, and organizations in leveraging behavioural insights to design effective, evidence-based policy interventions.

Module aims

Outline syllabus

This is an indicative module outline only to give an indication of the sort of topics that may be covered. Actual sessions held may differ.

Week 1: Foundations of behavioural public economics: Core findings from behavioural economics and their general implications for public policy
Foundations of behavioural economics.
Key public policy questions of today’s day and age.
Foundations of (field) experimental methodology.

Week 2: Behavioural insights regarding taxation: Why do behavioural insights matter for taxes?
Behavioural justification for taxes (sin taxes, time-inconsistent preferences).
Behavioural determinants of tax compliance (framing, salience, and social norms).
Behavioural approaches to improve tax collection.

Week 3: Behavioural interventions for social policy: health policy, unemployment policy, pension systems
Behavioural justifications for social policy.
Behavioural implications for pension systems (time-inconsistent preferences etc.).
Vaccine hesitancy and public health (mis)information.

Week 4: Behavioural labour economics: Why do behavioural insights matter for labour market policies?
Workplace motivation and productivity (non-monetary incentives, fairness, social preference, intrinsic motivation and peer effects).
Discrimination (stereotypes, heterogeneity in preferences).

Week 5: Behavioural insights for education: What do behavioural findings imply for education policy?
Encouraging participation and retention in education through behavioural insights (take up of on-the-job-training, overcoming present bias in educational investments).
Enhancing motivation and engagement (goal-setting, procrastination, grid).

Week 6: Inequality and redistribution policies: How can behavioural insights inform questions of redistribution?
Preferences for redistribution (individual differences, cross-country variation).
Public acceptance of welfare policies (stigma).
Behavioural insights to development aid (poverty traps, behavioural approaches to savings and credit access).

Week 7: Behavioural policies in governance: Why do behavioural insights matter for governance?
Improving civic engagement and voter turnout.
Bureaucratic efficiency in public administration.
The economics of corruption.

Week 8: Behavioural challenges for policy implementation I
Policy evaluation.
Behavioural cost-benefit analysis.
Public trust.

Week 9: Behavioural challenges for policy implementation II
Paternalism and ethical considerations.
Resistance to interventions and experimentation.
Scalability of behavioural policies.

Learning outcomes

By the end of the module, students should be able to:

• Examine core behavioural economics principles and their implications for public policy, including deviations from traditional economic models.
• Analyse how behavioural insights can address policy challenges in areas such as taxation, public health, education, and governance.
• Develop critical thinking and abstract reasoning abilities.
• Critique traditional public economics models through the lense of behavioural insights.
• Critique the limitations and ethical considerations of behavioural interventions in public policy design.

Indicative reading list

Week 1: Foundations of behavioural public economics
DellaVigna, S. (2009). Psychology and economics: Evidence from the field. Journal of Economic literature, 47(2), 315-372.
Levitt, S. D., & List, J. A. (2007). What do laboratory experiments measuring social preferences reveal about the real world?. Journal of Economic perspectives, 21(2), 153-174.

Week 2: Behavioural insights regarding taxation
Chetty, R., Looney, A., & Kroft, K. (2009). Salience and taxation: Theory and evidence. American economic review, 99(4), 1145-1177.
Dwenger, N., Kleven, H., Rasul, I., & Rincke, J. (2016). Extrinsic and intrinsic motivations for tax compliance: Evidence from a field experiment in Germany. American Economic Journal: Economic Policy, 8(3), 203-232.
Bott, K. M., Cappelen, A. W., Sørensen, E. Ø., & Tungodden, B. (2020). You’ve got mail: A randomized field experiment on tax evasion. Management science, 66(7), 2801-2819.
Hallsworth, M., List, J. A., Metcalfe, R. D., & Vlaev, I. (2017). The behavioralist as tax collector: Using natural field experiments to enhance tax compliance. Journal of Public Economics, 148, 14-31.

Week 3: Behavioural interventions for social policy (health policy, unemployment policy, pension systems)
List, J. A., & Samek, A. S. (2015). The behavioralist as nutritionist: Leveraging behavioral economics to improve child food choice and consumption. Journal of health economics, 39, 135-146.
Campos-Mercade, P., Meier, A. N., Schneider, F. H., & Wengström, E. (2021). Prosociality predicts health behaviors during the COVID-19 pandemic. Journal of public economics, 195, 104367.
Campos-Mercade, P., Meier, A. N., Schneider, F. H., Meier, S., Pope, D., & Wengström, E. (2021). Monetary incentives increase COVID-19 vaccinations. Science, 374(6569), 879-882.
Della Vigna, S., & Malmendier, U. (2006). Paying not to go to the gym. American Economic Review, 96(3), 694-719.

Week 4: Behavioural labour economics
Gneezy, U., & List, J. A. (2006). Putting behavioral economics to work: Testing for gift exchange in labor markets using field experiments. Econometrica, 74(5), 1365-1384.
Fehr, E., & List, J. A. (2004). The hidden costs and returns of incentives—trust and trustworthiness among CEOs. Journal of the European Economic Association, 2(5), 743-771.
Abeler, J., Huffmann, D. B., & Raymond, C. (2023). Incentive Complexity, Bounded Rationality and Effort Provision.
Hossain, T., & List, J. A. (2012). The behavioralist visits the factory: Increasing productivity using simple framing manipulations. Management Science, 58(12), 2151-2167.
Costa-Ramón, A., Schaede, U., Slotwinski, M., & Brenoe, A. A. (2024). (Not) thinking about the future: inattention and maternal labor supply.
Bursztyn, L., González, A. L., & Yanagizawa-Drott, D. (2020). Misperceived social norms: Women working outside the home in Saudi Arabia. American economic review, 110(10), 2997-3029.

Week 5: Behavioural insights for education
Levitt, S. D., List, J. A., Neckermann, S., & Sadoff, S. (2016). The behavioralist goes to school: Leveraging behavioral economics to improve educational performance. American Economic Journal: Economic Policy, 8(4), 183-219.
Herranz-Zarzoso, N., & Sabater-Grande, G. (2018). Monetary incentives and self-chosen goals in academic performance: An experimental study. International Review of Economics Education, 27, 34-44.
Campos-Mercade, P., Thiemann, P., & Wengström, E. (2023). Performance Incentives in Education: The Role of Goal Mismatch.

Week 6: Inequality and redistribution policies
Fehr, D., Mollerstrom, J., & Perez-Truglia, R. (2019). Your place in the world: The demand for national and global redistribution. National Bureau of Economic Research.
Cappelen, A. W., Hole, A. D., Sørensen, E. Ø., & Tungodden, B. (2007). The pluralism of fairness ideals: An experimental approach. American Economic Review, 97(3), 818-827.
Almås, I., Cappelen, A. W., & Tungodden, B. (2020). Cutthroat capitalism versus cuddly socialism: Are Americans more meritocratic and efficiency-seeking than Scandinavians?. Journal of Political Economy, 128(5), 1753-1788.
Contini, D., & Richiardi, M. G. (2012). Reconsidering the effect of welfare stigma on unemployment. Journal of Economic Behavior & Organization, 84(1), 229-244.

Week 7: Behavioural policies in governance
DellaVigna, S., List, J. A., Malmendier, U., & Rao, G. (2016). Voting to tell others. The Review of Economic Studies, 84(1), 143.
DellaVigna, S., & Kaplan, E. (2007). The Fox News effect: Media bias and voting. The Quarterly Journal of Economics, 122(3), 1187-1234.

Week 8: Behavioural challenges for policy implementation I
Tannenbaum, D., Fox, C. R., & Rogers, T. (2017). On the misplaced politics of behavioural policy interventions. Nature Human Behaviour, 1(7), 0130.
Thaler, R. H., & Sunstein, C. R. (2021). Nudge: The final edition. Yale University Press.
Ambuehl, S., Bernheim, B. D., & Ockenfels, A. (2021). What motivates paternalism? An experimental study. American economic review, 111(3), 787-830.
Briscese, G., & List, J. A. (2024). Toward an Understanding of the Political Economy of Using Field Experiments in Policymaking (No. w33239). National Bureau of Economic Research.

Week 9: Behavioural challenges for policy implementation II
Rompho, N. (2023). John A. List: The Voltage Effect—How to Make Good Ideas Great and Great Ideas Scale New York, NY, Currency, 2022, 288 pp. Behavioural Public Policy, 1-6.
Mazar, N., Elbaek, C. T., & Mitkidis, P. (2023). Experiment aversion does not appear to generalize. Proceedings of the National Academy of Sciences, 120(16), e2217551120.

Interdisciplinary

The module is highly interdisciplinary. These interdisciplinary opportunities enrich the module, providing students with a holistic framework to address complex, real-world policy challenges. Among others, it draws from:

Economics (e.g., behavioural economics, experimental economics)
Psychology (cognitive and social psychology)
Sociology (e.g., role of culture and social norms)
Political Science (e.g., governance, civic engagement)
Ethics (e.g., paternalism)
Public Health (e.g., nudges to promote healthier behaviours)
Data Science (data science tools to model, predict, and evaluate the impacts of behavioural policies at scale)
Organisational Behaviour (e.g., effort incentivisation)

International

Many lectures of the module extensively discuss differences in behavioural drivers of public policy issues. These include:
Varying social norms across countries are investigated as a contributing factor for cross-country differences in tax compliance.
Heterogeneity in inequality perceptions and in preferences for redistribution are discussed as drivers of varying amounts of income redistribution.
Differences between countries in civic engagement are investigated when voter turnout are analysed.

One lecture explores behavioural approaches in international development settings, such as savings programs or overcoming poverty traps.

The research evidence is international: the module incorporates findings from experiments conducted in diverse regions.

One lecture discusses multinational policy frameworks: it examines how behavioural insights are integrated into policies by international organizations such as World Bank, OECD, and WHO.

One lecture investigates scalability: the lecture discusses the challenges of adapting successful behavioural interventions from one country to another.

Subject specific skills

Interpret findings from field experiments to inform large-scale policy recommendations.
Evaluate behavioural policies through the lense of behavioural science
Design innovative policy interventions informed by behavioural insights
Implement complex behavioural insights into theory to develop practical policy solutions for real-world challenges.
Execute analytical frameworks to evaluate and improve behavioural interventions across a range of policy contexts.

Transferable skills

Formulate policy recommendations effectively to diverse audiences, including policymakers and stakeholders.
Demonstrate teamwork and problem-solving abilities through collaborative projects/group work.
Communication skills when formulating reports, presenting findings, and structuring arguments.