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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…
Risk aversion is a common behavior universal to humans and animals alike. Economists have traditionally defined risk preferences by the curvature of the utility function. Psychologists and behavioral economists also make use of concepts…
Standard macroeconomic models assume that households are rational in the sense that they are perfect utility maximizers, and explain economic dynamics in terms of shocks that drive the economy away from the stead-state. Here we build on a…
Rank-rank regression is commonly employed in economic research as a way of capturing the relationship between two economic variables. The slope of this regression is the Spearman rank correlation, a classical measure of association.…
This paper studies optimal consumption and saving decisions under uncertainty about the transition dynamics of the economic environment. We consider a general optimal savings problem in which the exogenous state governing discounting,…
China's structural changes have brought new challenges to its regional employment structures, entailing labour redistribution. By now Chinese research on migration decisions with a forward-looking stand and on bilateral longitudinal…
Labor share, the fraction of economic output accrued as wages, is inexplicably declining in industrialized countries. Whilst numerous prior works attempt to explain the decline via economic factors, our novel approach links the decline to…
We study how to perform tests on samples of pairs of observations and predictions in order to assess whether or not the predictions are prudent. Prudence requires that that the mean of the difference of the observation-prediction pairs can…
We propose a novel explanation for classic international macro puzzles regarding capital flows and portfolio investment, which builds on modern macro-finance models of experience-based belief formation. Individual experiences of past…
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…
The paper presents findings from a comprehensive study examining the saving and credit behaviors of low-income households residing in unauthorized colonies within a metropolitan area. Utilizing a dual approach, the study engaged in…
Over sixty percent of employees at a large South African company contribute the minimum rate of 7.5 percent to a retirement fund, far below the rate of 15 percent recommended by financial advisers. I use a field experiment to investigate…
Incentives have surprisingly inconsistent effects when it comes to encouraging people to behave prosocially. Classical economic theory, according to which a specific behavior becomes more prevalent when it is rewarded, struggles to explain…
We explore the implications of a preference ordering for an investor-consumer with a strong preference for keeping consumption above an exogenous social norm, but who is willing to tolerate occasional dips below it. We do this by splicing…
March 2020 confinement has shot Portuguese savings to historic levels, reaching 13.4% of gross disposable income in early 2021 (INE, 2023). To find similar savings figures we need to go back to 1999. With consumption reduced to a bare…
Most people are risk-averse (risk-seeking) when they expect to gain (lose). Based on a generalization of ``expected utility theory'' which takes this into account, we introduce an automaton mimicking the dynamics of economic operations.…
Accurate time-to-event prediction is integral to decision-making, informing medical guidelines, hiring decisions, and resource allocation. Survival analysis, the quantitative framework used to model time-to-event data, accounts for patients…
This paper investigates a novel behavioral feature of recursive preferences: aversion to risks that persist over time, or simply \textit{correlation aversion}. Greater persistence provides information about future consumption but reduces…
We introduce preferential behavior into the study on statistical mechanics of money circulation. The computer simulation results show that the preferential behavior can lead to power laws on distributions over both holding time and amount…
We study the associations between everyday economic decision-making quality and people's emotional states. Using high-frequency, highly disaggregated consumer "scanner" data, we show that the cost of poor decision-making is substantial, on…