Sociology of Financial Behavior

Bachelor 2023/2024

Category 'Best Course for Broadening Horizons and Diversity of Knowledge and Skills'

Category 'Best Course for New Knowledge and Skills'

Type: Elective course (Data Science and Business Analytics)

Area of studies: Applied Mathematics and Information Science

Delivered by: International College of Economics and Finance

Where: Faculty of Computer Science

When: 3 year, 1, 2 module

Mode of studies: offline

Open to: students of one campus

Instructors: Olga E. Kuzina

Language: English

ECTS credits: 4

Contact hours: 64

Full Syllabus

Abstract

The «Sociology of consumer finance» Bachelor Program is developed according to the standard educational requirements of the Federal State Autonomous Educational Institution of Higher Education «National Research University «Higher School of Economics» (HSE). Students are supposed to be familiar with Introduction to Probability Theory and Statistics and Economics.

Learning Objectives

The main goal of this unit is to develop a critical, reflexive, and interdisciplinary approach to key problems in contemporary research on financial behaviour of households.

Expected Learning Outcomes

to know conceptual and operational definitions of financial inclusion/exclusion and the results of cross-country variation in household access to financial services
to know conceptual and operational definitions of financial literacy and financial capability, as well as the results of international comparisons of financial literacy of individuals.
to know economic, psychological and sociological explanation of financial frauds
to know retirement-income systems across the world, research on pension wealth and household savings, and studies on retirement adequacy.
to know the causes and long-run macroeconomic implications of the rise in household indebtedness.
to know theoretical approaches and empirical research on the control and allocation of money within households, systems of money management in the families
to know theoretical models of households financial behaviour which are developed in economic sociology
to know theoretical models of households savings behaviour which are developed in behavioural economics
to know theoretical models of households savings behaviour which are developed in economic psychology
to know theoretical models of households savings behaviour which are developed in economic theory
to understand and interpret macro and micro statistics on household incomes and savings
to understand the notion of trust, conceptual and operational definitions, the role of state regulation on financial markets in creating trust to financial institutions

Course Contents

The main concepts and definitions of financial behaviour of households. Conceptual and operational defenitions
Economic models of personal savings
Psychological approach to studying savings behaviour of household
Behavioral economics of personal finance
Social embeddednes of financial behaviour of individuals and households
Family budget management studies in sociology
Trust to financial institutions and savings, financial vulnerability of households
Trust to financial institutions and savings
Access to financial services, financial inclusion, saving motives
Financial literacy and financial capability of individuals
Household retirement strategies
The sociology of consumer credit
Research on investment behaviour of households. Financial frauds

Assessment Elements

Class participation
Students’ activity during seminars.
Exam
Exam tests all knowledge and skills mastered during the course. The passing final grade for the course is announced after the final exam in December. The passing final grade could not be bigger than 40 marks or smaller than 25 marks depending on the overall results of students’ cohort. In case of unsatisfactory final grade in 100 - point scale for the course, a satisfactory grade in 10 - point scale is given if a student has received high grade for exam (60 marks or more).
Presentation
Download PPT files with HSE logo, presentation templates PPT or PPTX with HSE logo in English can be found here http://www.hse.ru/org/hse/info/logo . Students may use the HSE templates, however they are not obliged to do this. The file name must include the student's name and the title of the article in English. Example: Olga Kuzina’s presentation of the paper Modigliani, Franco and Richard Brumberg, 1954. Utility Analysis and the Consumption Function: An Interpretation of Cross-Section Data, in Kenneth K. Kurihara, ed.: Post Keynesian Economics, Rutgers University Press, New Brunswick, NJ, 388-436. The file name in this case should be as follows: Kuzina Utility Analysis and the Consumption Function An Interpretation of Cross-Section Data 1954.pptx or ppt, depending on which version of the Power Point program you use. You may choose any research paper from the list of readings in the syllabus, however if you want you may also use papers on financial behaviour of households which are not mentioned in the syllabus – the only thing which you have to do is to send me the full text of it in order to verify that the chosen topic is appropriate for the course. Be careful – no textbook chapters, literature reviews or business reports are acceptable for presentations. Empirical papers published in the academic peer review journals only! If the paper you are interested in has no link but a DOI name only you can resolve a DOI name here http://www.doi.org/ If students choose the same paper there will be no fun to listen the same ideas several times. That is why the teaching assistant will coordinate the choices of students via permanent updating the schedule of presentations according to the information which students will disclose to him or her. The schedule will be made on the first-come first-served basis, if the paper has been booked the rest should choose a different paper. Students can book their papers, dates and time on-line only! Links to the registration form and to the presentations’ schedule will be provided. Before filling the registration form, make sure that the paper has not been already booked by other students in your class! Presentations should be properly structured: start from the research problem of the paper and a justification of it (theoretical, empirical or policy-relevant issues to be mentioned) indicate the goal(s) of the paper explain theoretical ideas which are discussed by the author (literature review – students do not need to go into too many details – the main question for this section is to give an idea on what kind of theoretical and empirical literature the research is based on) reveal what the author’s idea, model, hypotheses, operationalisation of the main concepts are describe the data used (check if it is possible to get free access to the data used by the author of the paper) explain how the data was analysed – how is the model tested, what are the results? summarise the main conclusion of the paper – a short answer to the research question make the discussion slide (what we have learned from the paper and what we should be cautious about – critical assessment of the paper - students should give their opinion about the strengths and weaknesses of the paper – if there are any doubts in the objectivity of the research results of the paper).
Test
Test consists two parts: 1. Improve the questionnaire. Students are given the list of survey questions which have different mistakes in their wording. Students are supposed to indicate problems and improve questions to get higher construct validity of the measurement. 2. Theory quest. Students are supposed to demonstrate their knowledge of theoretical models of households’ financial behaviour which are developed in economic theory, economic psychology and economic sociology. Exam tests all knowledge and skills mastered during the course. There are no retakes of the test for those students who were not present irrespective for the reasons of the absence. ICEF 'students who are absent because of medical or other valid excuse during the test will be compensated by ICEF rules for grading.

Interim Assessment

2023/2024 2nd module
0.1 * Class participation + 0.4 * Exam + 0.3 * Presentation + 0.2 * Test

Bibliography

Recommended Core Bibliography

Deaton, A. (1991). Saving and Liquidity Constraints. Econometrica, (5), 1221. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.ecm.emetrp.v59y1991i5p1221.48
Deaton, A. (1992). Understanding Consumption. Oxford University Press. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.b.oxp.obooks.9780198288244
Denizer, C., Wolf, H. C., & Ying, Y. (2000). Household Savings in Transition Economies. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.45A1AEDC
Mental budgeting and the management of household finance. (2011). Journal of Economic Psychology, 32(4), 546–555. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsnar&AN=edsnar.oai.library.wur.nl.wurpubs.419402
Paul R. Gregory, Manouchehr Mokhtari, & Wolfram Schrettl. (1999). Do The Russians Really Save That Much? - Alternate Estimates From The Russian Longitudinal Monitoring Survey. The Review of Economics and Statistics, (4), 694. https://doi.org/10.1162/003465399558418
Shefrin, H. M., & Thaler, R. H. (1988). The Behavioral Life-Cycle Hypothesis. Economic Inquiry, (4), 609. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.oup.ecinqu.v26y1988i4p609.43
Shorrocks, A. F. (1975). The Age-Wealth Relationship: A Cross-Section and Cohort Analysis. The Review of Economics and Statistics, (2), 155. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.tpr.restat.v57y1975i2p155.63
Skoufias, E. (2004). Consumption smoothing during the economic transition in Bulgaria. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.6AA15472
Souleles, N. S. (2002). Consumer response to the Reagan tax cuts. Journal of Public Economics, (1), 99. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.eee.pubeco.v85y2002i1p99.120

Recommended Additional Bibliography

Richard H. Thaler. (2018). From Cashews to Nudges: The Evolution of Behavioral Economics. American Economic Review, (6), 1265. https://doi.org/10.1257/aer.108.6.1265
Зелизер, В. (2010). Human Values and the Market: The Case of Life Insurance and Death in 19th-Century America (translated by E. Berdysheva) ; Человеческие ценности и рынок: страхование жизни и смерть в Америке XIX века (перевод Е. С. Бердышевой). Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.8D1A9859

Course Syllabus