A new Research Unit "Psychoeconomics" (Universities of Cologne and Konstanz) financed by the German Research Foundation (see PDF Press Release) started its activities on October 1st, 2012. The Research Unit is coordinated by Prof. Carlos Alós-Ferrer.

RESEARCH STATEMENT:


Economics and psychology can both be called “Decision Sciences”. Understanding actual human decision making is essential for both disciplines. Proper models of decision-making are essential for understanding the consequences of economic and social policy, the effect of incentives and education on performance, the functioning of markets, and the allocation properties of economic institutions.

The last decades have witnessed a steady approximation of behavioural schools within economics and psychology, as demonstrated e.g. by the rise of the subdiscipline of behavioural economics. In this process, it has been recognized that normative economic models still lack a proper, systematic psychological foundation, while experimental psychology can greatly benefit from the formal approaches that characterises modern economics.

The Research Unit "Psychoeconomics" brings together researchers from different disciplines in a joint effort to develop an integrative, data-driven understanding of how interacting motives and strategies determine actual human behaviour, how human agents can regulate the resulting decision conflict or learn from it, and what are the economic consequences of decision conflicts and their regulation.

The research plan is structured around dual-process theories of human behaviour, which build mainly on insights from cognitive and social psychology. These theories postulate that human behaviour is the result of the interaction of different types of decision processes within a human decision-maker’s mind, some being more "automatic" (fast, effortless, and typically unconscious), and some more "controlled" (slower, not immediate, and consuming cognitive resources). It is our opinion that the basic paradigms underlying these theories hold the potential to deliver a new, improved framework for understanding actual human (economic) behaviour.