2017 Behavioral Economics and Management

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Academic unit or major
Undergraduate major in Industrial Engineering and Economics
Yamato Takehiko  Inoue Kotaro  Umemuro Hiroyuki  Senoo Dai 
Class Format
Media-enhanced courses
Day/Period(Room No.)
Mon1-2(西9号館425号室)  Thr1-2(西9号館425号室)  
Course number
Academic year
Offered quarter
Syllabus updated
Lecture notes updated
Language used
Access Index

Course description and aims

In modern economics, industrial engineering and management, rational decision making and behavior by individuals are largely assumed. However, recent empirical researches and experimental economics report that cognitive bias, sentiment, and emotion of individuals are important factors in the real world. This class introduce how these behavioral factors influence economic activities, productions, organizational behavior, financial market and corporate management.
Class participants are expected to understand the importance of behavioral factors in management and economics through active participation to experiments and projects in the class.

Student learning outcomes

The goal of this class are to understand the importance of behavioral factors such as cognitive bias, sentiment and emotion in developing theory or interpreting empirical and experimental results in the field of economics, industrial engineering, and management. In addition, class participants are expected to build his own idea of utilizing behavioral factors in product development, design of workspace and business, investment strategy, or design of rule and regulation.


Rationality, Cognitive Bias, Sentiment / Emotion / Affect, Behavioral Economics, Behavioral Finance

Competencies that will be developed

Specialist skills Intercultural skills Communication skills Critical thinking skills Practical and/or problem-solving skills

Class flow

Four faculties provide series of lectures based on own backgrounds. Experiments within lectures help understanding and insights to behavioral economics and management.

Course schedule/Required learning

  Course schedule Required learning
Class 1 Introduction Crowd behavior (1): an experiment Explain how to conduct a crowd behavior experiment.
Class 2 Crowd behavior (2): Theory and data analysis Explain the theory of decision making under uncertainty related to crowd behavior and analyze the experimental data.
Class 3 Stock trading: (1): an experiment Explain how to conduct a stock trading experiment.
Class 4 Stock trading (2): Theory and data analysis Explain the theory of stock trading and analyze the experimental data.
Class 5 Lecture: Inefficient Market and Behavioral Finance Explain Limits of Efficient Market Hypothesis and behavioral factors behind them.
Class 6 Class Discussion: Optimism, Risk Aversion, and Overconfidence Explain behavioral factors behind inefficient corporate behavior and investments.
Class 7 Lecture: Behavioral Finance and Management Explain development of behavioral finance researches and their implications to corporate management.
Class 8 What is affect / emotion? Scientific understanding of affect / emotion.
Class 9 What is affective (emotional) information processing? Understanding affective (emotional) information processing, in contrast with rational processing.
Class 10 Affects in social contexts Understanding meaning and significance of affects / emotions in social contexts.
Class 11 Providing affective experiences Understanding significance and means to provide with affective experience, and applications in industrial contexts.
Class 12 perception gaps Understand the perception gaps among members.
Class 13 Sense making in organizations Explain the sense making in organizations.
Class 14 Application to workplace design Discuss the application to workplace design.
Class 15 Application to workstyle design Discuss the application to workplace design.


No textbook is designated for this class. Lecture notes will be provided in class.

Reference books, course materials, etc.

Handouts will be provided in class.

Assessment criteria and methods

Class Participation 50%, Term Report 50%
Subject of the Term Report will be announced in the first class.

Related courses

  • IEE.B206 : Experimental Economics
  • IEE.D302 : Corporate Finance
  • IEE.D301 : Business Starategy and Organization
  • IEE.C203 : Engineering Psychology
  • IEE.D332 : Theories of Innovation
  • IEE.C330 : Topics of Industrial Engineering and Economics

Prerequisites (i.e., required knowledge, skills, courses, etc.)

Students are desired to have successfully completed Experimental Economics (IEE.B206), Corporate Finance (IEE.D302), Business Strategy and Organization (IEE.D301), and Engineering Psychology (IEE.C203) or to have equivalent knowledge.

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