Consumer Behavior

preliminary — subject to changes

Course Description

Examines consumer behavior from the point of view of various behavioral science concepts, relevant consumer research, and practical marketing applications. Topics include, but are not limited to, motivation, personality, perception, attitude formation, and the importance of group dynamics, social class, and culture on behavior in the marketplace.

Course Objectives

The course will enable students to gain an in-depth understanding of consumer decision making in the economy and corresponding marketing applications.

Course Materials

Required:

The course will follow:

Solomon, M.R., 2017. Consumer Behavior: Buying, Having, and Being, 12th global ed. Pearson. [CB] (get the 12th edition or the newer 13th edition on amazon)
and
Frank, R and Cartwright, E, 2020. Microeconomics and Behaviour, 3rd ed. McGraw-Hill. [MB] (get it on amazon)

The required and recommended readings from these two texts are indicated below by “CB: chapter” and “MB: chapter”, respectively.

Further Literature Recommendations:

Barden, P.P., 2013. Decoded: the science behind why we buy. John Wiley & Sons.
Chapman, C. and Feit, E.M., 2019. R for marketing research and analytics, 2nd ed. New York, NY: Springer.
Goldsmith, E.B., 2016. Consumer economics: Issues and behaviors, 3rd ed. Routledge.
Graves, P., 2013. Consumerology: The Truth about Consumers and the Psychology of Shopping. Hachette UK.
Kamins, M., 2018. Marketing Manipulation: A Consumer’s Survival Manual (Vol. 14). World Scientific.
Martin, N., 2008. Habit: The 95% of behavior marketers ignore. Ft Press.
Miller, T.W., 2015. Marketing data science: modeling techniques in predictive analytics with R and Python. FT Press.
Murphy, P.E., Laczniak, G.R. and Harris, F., 2017. Ethics in marketing: International cases and perspectives, 2nd ed. Taylor & Francis.
Pink, D.H., 2013. To sell is human: The surprising truth about moving others. Penguin.
Shotton, R., 2018. The Choice Factory: 25 behavioural biases that influence what we buy. Harriman House Limited.
Smith, A., 2019. Consumer Behaviour and Analytics: Data Driven Decision Making. Routledge.

Course Requirements:

Students must read the assigned chapters of the textbook(s) before each session. Reading the economic and political press will also be helpful.

I recommend that you try to solve the chapter problems in preparation and review of each class session.

Instructor Information:

Prof. Dr. Dennis A. V. Dittrich
dennis.dittrich@touroberlin.de
http://economicscience.net
Twitter: @davdittrich

You can always contact me via email or twitter. For meetings appointments can be arranged through the my webpage at: http://economicscience.net/content/book-appointment.

Updated information, links to the literature, additional materials, etc. can be found on my webpage as well.

Grading Guidelines:

Grading ComponentWeight
Problem Sets80%
Quizzes20%

Solutions to problem sets must be submitted by the beginning of the respective class. Late submission will lead to a penalty on the grade for the problem sets.

Workload

A typical 3 credit course requires 150 hours of your time. The table below identifies how I expect those 150 hours will be allocated. While you do not receive direct marks for reading, reading will affect your class participation mark (your ability to participate in class discussions and activities) and your final exam mark.

ActivityTime
Class Time (3 hours / week)45 hours
Reading (3 hours / week)45 hours
Preparation, Problem Sets, and Review (4 hours / week)60 hours

Topics and Reading Assignments

Session 1

  • Introduction

    • required: CB: 1

    slides

Session 2

  • The (Economic) Theory of Consumer Behavior:
    Rational Consumer Choice

    • required: MB: 4

    slides

Session 3

  • The (Economic) Theory of Consumer Behavior:
    Individual and Market Demand
    • required: MB: 5
    • recommended:
      Ariely, Loewenstein, & Prelec (2003), “‘Coherent arbitrariness’: Stable demand curves without stable preferences,” The Quarterly Journal of Economics, 118 (1), 73–105

Session 4

  • The (Economic) Theory of Consumer Behavior:
    Application of Rational Choice and Demand Theories
    • required: MB: 6
    • recommended:
      Ainslie (1975), “Specious reward: A behavioral theory of impulsiveness and impulse control,” Psychological Bulletin, 82 (4), 463–496
      Rabin & O’Donoghue (2000), “The economics of immediate gratification,” Journal of Behavioral Decision Making, 13 (2), 233–250

Session 5

  • The (Economic) Theory of Consumer Behavior:
    Choice under Uncertainty and the Economics of Information
    • required: MB: 7
    • recommended:
      Sections I–V of Tversky & Kahneman (1986), “Rational choice and the framing of decisions,” The Journal of Business, 59 (4, Pt. 2), S251-S278
      Thaler (1985), “Mental accounting and consumer choice,” Marketing Science, 27 (1), 15–25
      English summary of Allais (1953), “Le comportement de l’homme rationnel devant le risque: Critique des postulats et axiomes de l'école americaine,” Econometrica, 21 (4), 503–546
      Ellsberg (1961), “Risk, ambiguity, and the Savage axioms,” The Quarterly Journal of Economics, 75 (4), 643–669
      Section titled “Anchoring and Adjustment” from Tversky & Kahneman (1974), “Judgment under uncertainty: Heuristics and biases,” Science, 185 (4157), 1124–1131

Session 6

  • The (Economic) Theory of Consumer Behavior:
    Cognitive Limitations and Consumer Behavior
    • required: MB: 9
    • recommended:
      Angner & Loewenstein (2012), “Behavioral economics,” in Mäki, ed., Handbook of the Philosophy of Science: Philosophy of Economics, Amsterdam: Elsevier, pp. 641–690
      Loewenstein & Angner (2003), “Predicting and indulging changing preferences,” in Loewenstein, Read, & Baumeister, eds, Time and Decision: Economic and Psychological Perspectives on Intertemporal Choice, New York: Russell Sage Foundation, pp. 351–391
      Huber, Payne, & Puto (1982), “Adding asymmetrically dominated alternatives: Violations of regularity and the similarity hypothesis,” The Journal of Consumer Research, 9(1), 90–98.
      Kahneman, Knetsch, & Thaler (1991), “Anomalies: The endowment effect, loss aversion, and status quo bias,” The Journal of Economic Perspectives, 5 (1), 193–206

Session 7

  • Consumer and Social Wellbeing
    • required: CB: 2

Session 8

  • Perception
    • required: CB: 3

Session 9

  • Learning and Memory
    • required: CB: 4

Session 10

  • Motivation and Affect
    • required: CB: 5

Session 11

  • Attitudes and Persuasive Communication
    • required: CB: 8

Session 12

  • Decision Making
    • required: CB: 9

Session 13

  • Groups and Social Media
    • required: CB: 11

Session 14

  • Income and Social Class
    • required: CB: 12

Session 15

Final

Topics and reading assignments are subject to changes.

Problem sets

You will find the problems sets for download in a pCloud folder: here.

Upload you solutions to this pCloud folder [Click Here!] Please use PDF or plain text for your uploads.

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