Behavioral and Experimental Economics

Behavioral and experimental economics are relatively new fields within economics. Economic experiments are human subject experiments in which human beings ranging from university students to CEOs make decisions in various controlled experimental environments. A key feature of experiments is that they involve financial compensation. Economic experiments allow researchers to study new economic instruments and policies before they have been introduced and evaluate the result of changes to existing policies. They also allow researchers to understand how behavior changes over time, how people's attributes and traits impact their economic decision making and how human beings respond to change and behave in risky situations.