Behavioral Economics: Nudging to Shape Decisions

Through a highly interactive learning environment, you’ll learn how to use data intelligence to better predict outcomes and practically apply behavioral insights to your organization. You will discover the benefits of a well-designed choice architecture structure and explore the role biases, fallacies, and heuristics play in decision-making.

By attending this program, you will:

• Learn how to design products and services that create more value for customers
• Discover the emotional and cognitive underpinnings of economic behavior changes and how professionals make decisions
• Explore hidden biases and heuristics that either reinforce or counteract outcomes
• Discover how “choice architecture” may optimize decisions to benefit economic, regulatory, and policy creation strategies
• Gain the frameworks to draw actionable insights from data intelligence to improve customer experiences and engagement
• Discover the tools to optimize your value proposition for greater influence and impact
• Increase management decision outcomes that result in improved enterprise-wide efficiencies and processes

Format
Online with three live-online sessions

Language
This program is offered in English, Portuguese, and Spanish.

Program duration
Eight weeks, 3–5 hours per week

This program is designed for mid- senior level executives from around the globe who are responsible for making impactful, efficient, and economic decisions for their organizations. Those who are in the role of presenting choices to clients, customers, and key stakeholders (choice architects) will benefit from this program.

In addition, those in the fields of finance, marketing, sales, business development, healthcare, market research, consulting, policy, and entrepreneurship will find this program beneficial. 

This program can be applied to any industry including healthcare, utilities, insurance, banking, retail, manufacturing, nonprofit, and government agencies.

A history of behavioral economics and prospect theory

• Analyze the evolution of economics from Classical economics (e.g., Adam Smith) to modern-day neo-classical economics and where behavioral economics started to flourish in this paradigm
• Understand the revolutionary inflection point that occurred at the end of the 1970s by the three fathers of behavioral economics to explain how psychology became part of the economic model of decision making
• Dissect what systematic bias is and learn about the most cited and ground-breaking behavioral economy theory: prospect theory
• Explore several examples of how prospect theory matters both in our personal lives and when running a business

Sophisticated choices and self-control

• Explain the influence of intertemporal components in the choices we make and realize how they can provoke non-standard behavior (such as obesity, addictions, credit card usage and dependence, etc.)
• Formulate mathematical models that explain phenomena such as procrastination and overindulgence
• Visualize examples of how self-control problems can lead to bad decision-making: as soon as you turn 18, you are much more likely to be tried as an adult, and yet, we do not see people ceasing committing crimes as soon as they turn 18. Why is this?
• Learn how to apply this knowledge in a way that modifies behavior and improves the health of your business or the people around you

Fairness

• Compare the dichotomy between the standard rational economics assumption that humans are self-interested and the behavioral economics propositions explaining how and why humans are altruistic and care about giving to others
• Articulate why thinking in financial terms and incentives might not always be a wise idea, and understand how fairness matters within economic marketplaces, and how fairness is compatible with running a business
• Analyze why and when it is socially accepted to charge fees or surcharges, and more generally, to equilibrate supply and demand using standard economic pricing mechanisms
• Learn the importance of social norms and pressure, reciprocity, and distributive vs procedural justice

The psychology of incentive

• Discover through a Qualtrics-based exercise in experimentation and prediction what kind of motivational treatments work best in the short run in order to make someone execute a given task
• Realize that behavioral economics is only barely getting started when it comes to understanding motivation: what other approaches motivate people to make decisions?
• Think about how to create a company culture that is built on solid psychological principles

Biased belief

• Recognize how information interventions over biased beliefs can modify mindsets and be potential sources of change and development of new standards in decision-making
• Learn how nearly everyone exhibits common biases such as projection bias and the bias of winner’s curse
• Identify some of the most important biases, such as survivorship bias and overconfidence, and learn how they influence business decision making

Inattention

• Discover how our attention is limited and why this limited attention leads us to make important decision errors when our attention is drawn to some things but not others
• See how something as simple as failing to pay attention to certain digits of a number can dramatically change how certain economic markets function
• Learn how inattention works in a competitive market and how to grapple with the ethics of competing for consumer attention
• Learn the challenges and opportunities in addressing human rights abuses in cybertechnology

Discrimination

• Measure and identify the sensitive topic of discrimination through five distinctive methods: audit studies, all-else-equal studies, own-group bias studies, correspondence studies, and eliminating group cues in the decision-making process
• Learn how standard economics categorizes discrimination into one of two models: statistical discrimination and taste-based discrimination
• Become familiar with how psychology can deepen our understanding of how discrimination works and how we can combat it

Nudging

• Become familiar with basic principles of good choice architecture and the way we can influence people’s behavior by nudging them into a good direction
• Discuss several examples of nudging such as putting numbers into context and smart engineering/design
• Detect examples of nudges and sludge (bad psychology, the exact opposite of nudging) in the real world and apply it to your business or career

The program truly exceeded my expectations! It was very enlightening to better understand why people make their decisions and how those decisions can be influenced. The variety of content in each module was very engaging, and it was a bonus to have such a diverse group of peers from around the globe. The live sessions with Professor Pope, our guest speaker, Scott Young, and our mentors, Stuart and Jessica, were extremely worthwhile. I look forward to applying what I've learned both professionally and in my personal life.

Although I have an extremely demanding role, I found the material easy to manage on the weekends. I truly looked forward to each new module every week and readily shared what I had learned with family, friends, and co-workers. Behavioral Economics was not a dedicated focus area of study when I was in school, but the material resonated with me much more than classical economic theory. I also appreciated Professor Pope weaving ethical considerations into the content and discussions. Thank you!

—Renee Neubecker, Director of Strategy, Motorola Solutions, Inc.

I entered the program with high expectations because of the University of Chicago's reputation in Business and Economics education. My expectations were exceeded because of the quality of the program. I was particularly impressed with the video presentations by Professor Pope, where the research was explained in relatable and understandable ways. The program encompassed the perfect ratios of charm, humor, and earnestness and inspired me to dig deeper into the material of behavioral economics. 

—Richard Korneck