New DFG-funded Collaborative Research Center at LMU to investigate the significance of behavioral biases of individuals in competitive environments

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A new DFG-funded Collaborative Research Center based at LMU will probe the influence of systematic misconceptions and biases in expectations and preferences on economic decision-making and the workings of markets.

MÜNCHEN, 25-Nov-2016 — /EuropaWire/ — Studies in the field of Behavioral Economics have shown that the classical assumption that market participants make decisions solely on the basis of rational considerations is not always valid. The new Transregio Collaborative Research Center on “Rationality and Competition: The Economic Performance of Individuals and Firms” (TRR 190) will investigate theoretically and empirically the significance of behavioral biases of individuals in competitive environments. Among the issues that will be tackled is the question of how systematic misconceptions influence economic decision-making by private households in the areas of education and health. But the researchers will also look at individual decision-making in the commercial sphere, and analyze how firms react to the behavior of their employees and their customers and how these decisions are influenced by competition. Coordinator of the new transregional CRC is Klaus Schmidt, who holds the Chair of Economic Theory at LMU. “Our goal is to identify the conditions under which systematic distortions in the formation of expectations, preferences and decisions have a significant effect on market outcomes, but also the circumstances under which standard economic models adequately account for individual behavior,” Schmidt says. The researchers also hope to obtain new insights relating to the efficiency of markets and the efficacy of various economic policy tools, for example in the field of taxation and the regulation of financial markets. Berlin‘s Humboldt University will also participate in the CRC.

Dynamics of bacterial cells

LMU researchers will also be involved in the new Transregio CRC on “Spatiotemporal Dynamics of Bacterial Cells” (TRR 174), which will be coordinated by Marburg University. Deputy Coordinator of the project is Professor Kirsten Jung, who holds the Chair of Microbiology at LMU. The primary objective of TRR 174 is to elucidate the subcellular organization of bacteria and investigate the mechanisms that underlie the dynamic patterning of proteins in the intracellular space. “Recent advances in microscopy and biological imaging have provided us with new tools that can reveal with unprecedented resolution the distribution of molecular components in single cells, and monitor how these patterns change over time,” Jung explains. A better understanding of the internal dynamics of bacterial cells is a prerequisite for the development of novel antibiotics and the construction of bacterial designer strains for biotechnological applications.

In addition to establishing new TRRs, the DFG has also announced that funding for the existing CRC on “Control of the Plasticity of Cell-Fate Decisions in the Immune System” (CRC 1054). Here, the goal is to determine how specialized subpopulations of T cells, which play a central role in immune defense, develop from precursor cells. The Coordinator of CRC 1054 is Professor Thomas Brocker, Director of the Institute of Immunology at LMU.

SOURCE: Ludwig-Maximilians-Universität München

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