Monash University Handbook 2010 Undergraduate - Unit

Synopsis

A basic pillar of economic theory is that behaviour is governed by the response to incentives (what psychologists term 'extrinsic motivation'). But 'intrinsic motivation' plays a great role. People conceive incentives differently depending on the context. The unit elaborates on the interface of incentives and psychological factors such as bounded rationality, self-deception, weakness of will, and regret, to understand the complexity of human motivation. The unit also focuses on how organisations harness human motivation in the face of asymmetry of information (which usually undermines cooperation) and bounded rationality.

Objectives

The learning goals associated with this unit are to:

• investigate the interplay of psychological variables with economic incentives
• investigate the different meaning of rationality
• investigate how rationality, and its multi-level meaning, relate to the emotions
• investigate why the rational choice approach is useful even when people behave

• investigate how could self-deception and self-rationalisation be possible if people are basically rational.

Assessment

Within semester assessment: 50%
Examination (2 hours): 50%

Contact hours

3 hours per week

Prerequisites

ECC1000

Prohibitions

MGC2600