Behavioral Decision-Making Perspective in Business and Public Policy

In this course you will learn the basics of behavioral economics and how behavioral insights are applied in business and public policy context. You will gain understanding on behavioral biases and heuristics that are apparent in human behavior. Nudges and choice architecture are introduced as a mean to change people’s behavior.

The study unit is divided into orientation module and five learning modules:

• Module 1: General overview of behavioral insights in business and public policy
• Module 2: Deeper into behavioral insights
• Module 3: Ethical perspectives of behavioral interventions
• Module 4: Behavioral insights into action
• Module 5: Applying behavioral perspective

The study unit contains planning and executing a small-scale real-life intervention applying behavioral insights, and analysis of an existing development plan from a behavioral perspective. You will also engage in discussions with other students in an online forum by posting conversation starters and commenting other students’ texts about different topics you have studied about

You will learn to:

• understand the role of heuristics and biases in everyday decision making
• explore the fields of behavioral economics and behavioral decision making
• identify and apply psychological factors in business and public policy applications
• evaluate development plans from behavioral perspective
• analyze ethical aspects of behavioral interventions and nudges

Anyone interested about the topic.

The study unit is completed independently following a recommended schedule for returning assignments and completing the whole course by a given deadline. Self-direction is required.

The study unit does not include meetings except an online kick-off lecture on Tuesday, May 21, 2024 at 18.00 -19:00 (EET / Finnish time) in Zoom. No other lectures will be held which enables self-paced learning. You will study in a Canvas learning environment which includes learning material and assignments/tests.

You can reach the instructor at the beginning of the course before mid-June and again after the end of the course. You and reach your fellow students through the Q&A discussion board on Canvas platform and you can also use the Canvas Inbox or email messages.

The student must be present at the first contact lesson or notify the teacher in charge of his/her absence to confirm his/her participation in the study.

The study unit is divided into 5 modules. The deadline for completing the whole course is August 11th, 2024. Students are strongly recommended to follow the given schedule with suggested assignment deadlines to ensure steady progression.

Retake deadline is September 15th, 2024.

Due to the special nature of grading logic with is based on the completed number of modules, the total amount of effort per student may vary substantially. As a rule of thumb, modules 1 and 2 requires more effort than rest of the modules. Notice that for the intervention assignment in module 4 you may need to plan several days or weeks to be completed properly.

Main course literature includes the following articles. Additional video materials are given on Canvas platform.

Module 1:

• Kahneman, D. 2003. A perspective on judgment and choice: mapping bounded rationality. American psychologist, 58(9), 697
• Thaler, R., Sunstein, C. & Balz, J. 2013. Choice architecture. In Shafir, E. (eds.), The behavioral foundations of public policy (pp. 428–439). Princeton University Press.
• Fehr-Duda, H. & Fehr, E. 2016. Sustainability: Game human nature. Nature News, 530(7591).
• Goldstein, D., Johnson, E., Herrmann, A., & Heitmann, M. 2008. Nudge your customers toward better choices. Harvard Business Review, 86(12), 99-105
• Dholakia, U. M. 2016. Why nudging your customers can backfire. Harvard Business Review
• Steffel, M., Williams, E. F. & Pogacar, R. 2016 How to Nudge Your Customers Without Pushing Them Away. Harvard Business Review.

Module 2:

• Dolan, P., Hallsworth, M., Halpern, D., King, D. & Vlaev, I. 2010. MINDSPACE: Influencing behaviour for public policy. Institute of Government, London, UK.
• Oeberst, A., & Imhoff, R. 2023. Toward Parsimony in Bias Research: A Proposed Common Framework of Belief-Consistent Information Processing for a Set of Biases. Perspectives on Psychological Science, 18(6), 1464-1487.

Module 3:

• Sunstein, C. R. 2015. Fifty shades of manipulation.
• Reisch, L. A. & Sunstein, C. R. 2016. Do Europeans like nudges? Judgment and Decision Making, 11(4), 310–325.
• OECD. 2017. Behavioural Insights and Public Policy: Lessons from Around the World. OECD Publishing, Paris.
• Benartzi, S., Beshears, J., Milkman, K. L., Sunstein, C. R., Thaler, R. H., Shankar, M., Tucker-Ray, W., Congdon, W. J. & Galing, S. 2017. Should governments invest more in nudging? Psychological Science, 28(8), 1041–1055.

Module 4:

• Michie, S., Richardson, M., Johnston, M., Abraham, C., Francis, J., Hardeman, W., Eccles, M.P., Cane, J. & Wood, C. E. 2013. The behavior change technique taxonomy (v1) of 93 hierarchically clustered techniques: building an international consensus for the reporting of behavior change interventions. Ann Behav Med. 2013 Aug;46(1):81-95.
• Carlin, D., Houshmand, K., Rodriguez, S. & Talloen, J. 2023. To create lasting change, companies can draw on behavioral insights. McKinsey & Company.
• Müller, M. M., Böhm, K. L., & Renz, E. 2023. Pay or nudge employees into change? A theoretical and experimental investigation of the effect of nudging for organizational change. Managerial & Decision Economics, 44(6), 3666–3695.

Module 5:

• Hallsworth, M. 2023. A manifesto for applying behavioural science. Nature Human Behaviour, Nature, vol. 7(3), pages 310-322, March.

Suggested background reading material:

• Johnson, E. 2021. The elements of choice: Why the way we decide matters. Riverhead Books.
• Halpern, D. 2016. Inside the nudge unit: How small changes can make a big difference. Random House.
• Thaler, R. & Sunstein, C. 2009. Nudge: Improving decisions about health, wealth, and happiness. Penguin.

The course will be evaluated on a scale of 1 to 5 / fail. Minimum requirement to pass the course is that you complete the Orientation and module 1 by August 11th, 2024. Your grade will be defined based on the number of modules that you have successfully completed. Each module will be evaluated on a Pass/Fail basis.

Arviointiasteikko: H-5

• The study unit corresponds to the requirements of Master’s level education.
• The prerequisite for participation is always that the possible competence prerequisites according to the curriculum (previous study or similar competence) are fulfilled. The student is responsible for taking into account the prerequisite conditions.
• In order to sign up for this master’s level course, you must have a previous Bachelor’s degree or a Master’s degree or have equivalent skills.
• As a rule, the use of AI is permitted and its utilisation must always be disclosed. Sources must always be referenced, even if the text was produced with the help of an AI. The use of AI must be clearly indicated in a text whenever it is utilised in the production or editing of any texts or images. Remember to also explain how it has been utilised, for example in reading information sources and analysing material.

Please familiarize yourself with the cancellation process and cancellation terms.