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TRR 190

Rationality and Competition: The Economic Performance of Individuals and Firms
Spokesperson Prof. Dr. Georg Weizsäcker
Administrative Manager Viviana Lalli
Contact Details +49 30 2093-99492

Spandauer Str. 1
10178 Berlin

Research Programme

The Collaborative Research Center Transregio “Rationality and Competition” combines the research programs of behavioural and neoclassical economists to study applied economic questions that are of high policy relevance. The focus of TRR 190 is on the economic behaviour and performance of individuals and firms: How do systematic biases in expectations, decision processes, and preferences affect the most important economic decisions of households – about education, health, labor supply, financial investments and the purchase of durable consumption goods? How do firms respond to behavioural biases of their customers and their employees, for example by adjusting their marketing strategies, their organisational design, their incentive schemes and their innovation activities? Does competition reduce or amplify the effects of behavioural biases of individuals and firms? What economic policy interventions are effective to protect consumers and employees from exploitation and how can they prevent the destabilisation of markets (due to bubbles and crashes)? Thus, the CRC/TRR “Rationality and Competition” analyses the allocative consequences and the economic policy implications of different aspects of rationality and deviations from rationality in competitive environments.

An important question is in what environments behavioural biases have a quantitatively large effect and under what circumstances the standard, neoclassical model is sufficient to explain observed behaviour. Answering this question requires the close collaboration of behavioural and neoclassical economists that the CRC is set up to promote. The CRC employs modern microeconomic theory (including behavioural economic theory) to generate testable hypotheses as well as a wide set of empirical methods using field data, survey data, administrative data and economic experiments.

Gender Balance

The number and the percentage of female participants in the TRR 190 has increased substantially between submitting the proposals for the group’s first funding period and its second funding period. The group is particularly pleased that the increase in female participation is most pronounced at the level of PIs. The number of female PIs has doubled in the second funding period. The target proportions of women in the 2nd funding period are: doctoral researchers 50%, postdoctoral researchers 42%.

Equal Opportunities Measures

The TRR 190 has the following equal opportunities measures in place:

Flexible childcare: The research group supports parents both financially and in terms of logistics in organising child care, in order to make it easier for parents to participate in scientific conferences and other professional events. At LMU Munich, the group collaborates with pme Familienservice which offers backup child care in emergency situations and finds babysitters for childcare at home. In Berlin, KidsMobil offers flexible childcare for children aged 4 months to 14 years at home.

Student assistant support: The group supports early-career researchers who are pregnant or have to take care of small children. Student assistants can be hired by these researchers to administer lab experiments, to search and organise empirical data, or to do a literature search.

Home office equipment: The group supports parents who have to do a significant part of their work at home with home office equipment.

Mobility grants: All female early-career researchers (including doctoral researchers) can apply for mobility grants. These grants cover incremental expenses of a research visit, including airfare, visa costs, and daily allowances for board and lodging.

Mentoring programme: The group introduced a mentoring programme for all early career researchers. All female CRC members are encouraged to participate in further gender-specific coaching opportunities offered by LMU-Extra and ProFil.

Sabbatical priority: Within the (limited) support or researchers at an advanced stage of their career, one sabbatical research semester is reserved for a female researcher.

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