Behavioural Economics

Question 1:

It is believed that in recent years, there has been a noticeable global shift towards populist parties, with individuals increasingly gravitating away from centrist positions. Use behavioural economics to analyse why this might be the case, and to make predictions which are based on knowledge from behavioural economics and on scenarios that you have in mind with regards to socioeconomic trends. When developing your arguments, make the economic reasoning explicit. When discussing core empirical research, also briefly reflect on how the authors tested key hypotheses and identified causal effects. [100 marks]

Question 2: 

Suppose that the government wants to implement policies to encourage citizens to eat more healthily. The rational model might discourage such interventions, as these might prevent maximising utility.

A. Use behavioural economic reasoning to explain why a government concerned about citizens’ utility would still want to intervene. 

B. Next, discuss two measures (which may well have been implemented already in certain regions or countries) and use behavioural economics to explain why these might help to reach the target of adopting a more healthy lifestyle. When developing your arguments, make the economic reasoning explicit. When discussing core empirical research, also briefly reflect on how the authors tested key hypotheses and identified causal effects.