6 points, SCA Band 3, 0.125 EFTSL
Undergraduate - Unit
Refer to the specific census and withdrawal dates for the semester(s) in which this unit is offered.
- Second semester 2019 (On-campus)
The unit covers the intersection of economics and psychology. The unifying theme is the role of "rationality" with respect to four behavioural clusters: temptations (over-eating); habits of thought (stereotyping); framing effects (is a pay raise too little given the expectation?); and motivational effects (persistence in the pursuit of a career or an ideology). The unit contrasts expected utility theory and its alternative, discusses self-deception, heuristics, regret, stubbornness, dogmatism, intrinsic motivation, desire for justice, prisoner' dilemma, and public goods games.
The learning goals associated with this unit are to:
- identify rational choice and deviations from rationality such as temptations, self-deception, superstitions, and conspiracy theories.
- understand habit-governed behaviour and cognitive illusions such as stereotyping.
- appreciate why perspective (framing) matters in understanding how people assess gains or losses, along the clich of whether a glass is half-empty or half-full.
- appreciate why motivation (when framing is infused with a goal) matters in understanding tenacity in the pursuit of a goal, which may shed light on career commitment, ambition, entrepreneurship, and why historical costs (sunk cost) matter.
- explain puzzles in behavioural finance (e.g., equity premium puzzle and the volatility puzzle) and the origin of legal rules concerning equality.
Within semester assessment: 50% + Examination: 50%
Minimum total expected workload to achieve the learning outcomes for this unit is 144 hours per semester typically comprising a mixture of scheduled learning activities and independent study. Independent study may include associated readings, assessment and preparation for scheduled activities. The unit requires on average three/four hours of scheduled activities per week. Scheduled activities may include a combination of teacher directed learning, peer directed learning and online engagement.
See also Unit timetable information