Theoretical Foundations of Behavioral Game Theory

This exam addresses the intersections between behavioral economics and traditional game theory, emphasizing how psychological factors influence decision-making. Central themes include bounded rationality, prospect theory, and their implications for strategic interactions.

Behavioral insights into game theory provide a foundation for understanding economic behavior beyond classical assumptions. They affect market dynamics and negotiations by highlighting how real human behavior deviates from rational models.

Candidates will be assessed on their ability to articulate the core tenets of behavioral game theory and discuss how these concepts disrupt standard economic interpretations. Analysis of specific case studies may be included.

A strong understanding of both theoretical frameworks and real-life applications is essential, reflecting the growing importance of this interdisciplinary approach in economics.