Related papers: Preferences Yielding the "Precautionary Effect"
Many experimental studies report that economics students tend to act more selfishly than students of other disciplines, a finding that received widespread public and professional attention. Two main explanations that the existing literature…
Gilboa and Schmeidler's (1989) uncertainty aversion plays a central role in decision theory and economics, yet many inconsistent behaviors have been observed in experiments. Motivated by this, we study an axiom postulating a minimal degree…
In statistical practice, whether a Bayesian or frequentist approach is used in inference depends not only on the availability of prior information but also on the attitude taken toward partial prior information, with frequentists tending to…
This paper is dedicated to a cautious learning methodology for predicting preferences between alternatives characterized by binary attributes (formally, each alternative is seen as a subset of attributes). By "cautious", we mean that the…
We show that it can be suboptimal for Bayesian decision-making agents employing social learning to use correct prior probabilities as their initial beliefs. We consider sequential Bayesian binary hypothesis testing where each individual…
As a firm varies the price of a product, consumers exhibit reference effects, making purchase decisions based not only on the prevailing price but also the product's price history. We consider the problem of learning such behavioral…
Imitation is a key component of human social behavior, and is widely used by both children and adults as a way to navigate uncertain or unfamiliar situations. But in an environment populated by multiple heterogeneous agents pursuing…
Snapshots of "best" (or "worst") experience are known to dominate human memory and may thus also have a significant effect on future behaviour. We consider here a model of repeated decision-making where, at every time step, an agent takes…
In the persuasion model, apart from a few special cases, comparative statics has been an open question. We answer it, delineating which shifts of the sender's interim payoff lead her optimally to choose a more informative signal. Our first…
Reward functions are easy to misspecify; although designers can make corrections after observing mistakes, an agent pursuing a misspecified reward function can irreversibly change the state of its environment. If that change precludes…
To choose between two discrete goods, a consumer pays attention to only those with prices below a threshold. From these, she chooses her most preferred good. We assume consumers in a population have the same preference but may have…
In mainstream neoclassical economics, utility maximization is the only engine of individual action, and the other or the social, if it is modeled for decisions deemed fundamental, it is done as a tacit externality parameter affecting an…
Different agents need to make a prediction. They observe identical data, but have different models: they predict using different explanatory variables. We study which agent believes they have the best predictive ability -- as measured by…
Reinforcement learning algorithms usually assume that all actions are always available to an agent. However, both people and animals understand the general link between the features of their environment and the actions that are feasible.…
I formulate and characterize the following two-stage choice behavior. The decision maker is endowed with two preferences. She shortlists all maximal alternatives according to the first preference. If the first preference is decisive, in the…
An important question in economics is how people choose between different payments in the future. The classical normative model predicts that a decision maker discounts a later payment relative to an earlier one by an exponential function…
We investigate how the choice of decision makers can be varied under the presence of risk and uncertainty. Our analysis is based on the approach we have previously applied to individual decision makers, which we now generalize to the case…
This paper explores the challenges of constructing suitable inferential models in scenarios where the parameter of interest is determined in light of the data, such as regression after variable selection. Two compelling arguments for…
Background: Confirmation bias is the tendency to acquire or evaluate new information in a way that is consistent with one's preexisting beliefs. It is omnipresent in psychology, economics, and even scientific practices. Prior theoretical…
An experimenter seeks to learn a subject's preference relation. The experimenter produces pairs of alternatives. For each pair, the subject is asked to choose. We argue that, in general, large but finite data do not give close…