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Design & Behavior

What is “Design & Behavior”?

Economic engineering is the science of designing real-world institutions and mechanisms that align individual incentives and behavior with the underlying goals. Mechanisms matter because they affect incentives, and decision makers respond to incentives. They do not always do so in a rational or selfish way, though; yet behavior often responds in a systematic way.

This is the starting point of our research in “Design & Behavior”, where we identify, model and investigate behavioral complexities that are relevant for a broader range of ‘real-world’ contexts, and develop mechanisms (often based on game theory) for specific contexts that can be proven to be robust against such behavioral complexities. Applications include spectrum and security auctions, energy markets, financial markets, emission trading rules and climate negotiation design, procurement and supply chain contracts, worker compensation schemes, matching and online markets.

More information about “Design & Behavior” and news can be found on the following website:  Design & Behavior - Economic Engineering of Firms and Markets DFG Research Unit (FOR 1371)

Prof. Dr. Axel Ockenfels

Research on Design and Behavior is exciting and important. One reason is that the way we design institutions affect prices of electricity and telecommunication services, satisfaction at work, the degree of trust in markets, and the success of individuals, societies and politics. Another reason is that dealing with real world challenges allows us to build better models of human behavior, markets and firms.

Prof. Dr. Axel Ockenfels

Interdisciplinary approach for excellent research

To promote interdisciplinary collaboration among scientists, “Design & Behavior” and “Behavioral Management Science” (which has its origin in the “Design & Behavior” group) are strongly interconnected. Both Key Research Profile Areas are part of the University’s “ Center for Social and Economic Behavior” (C-SEB) as a result of the University of Cologne’s successful application to the  Excellence Initiative of the German government.

“Design & Behavior” and “Behavioral Management Science” aim at sustaining a strong momentum in interdisciplinary research activities, building up state-of-the-art laboratory infrastructure, strengthening regional research collaborations and international networks, and offering a complementary teaching programs from Bachelor to PhD studies.