Related papers: Motives for Delegating Financial Decisions
When people choose what messages to send to others, they often consider how others will interpret the messages. A sender may expect a receiver to engage in motivated reasoning, leading the receiver to trust good news more than bad news,…
Human reasoning often involves working over limited information to arrive at probabilistic conclusions. In its simplest form, this involves making an inference that is not strictly entailed by a premise, but rather only likely given the…
A large share of retail investors hold public equities through mutual funds, yet lack adequate control over these investments. Indeed, mutual funds concentrate voting power in the hands of a few asset managers. These managers vote on behalf…
Many experiments elicit subjects' prior and posterior beliefs about a random variable to assess how information affects one's own actions. However, beliefs are multi-dimensional objects, and experimenters often only elicit a single response…
Technical Debt management decisions always imply a trade-off among outcomes at different points in time. In such intertemporal choices, distant outcomes are often valued lower than close ones, a phenomenon known as temporal discounting.…
We analyze strategic delegation in a Stackelberg model with an arbitrary number, n, of firms. We show that the n-1 last movers delegate their production decisions to managers whereas the first mover does not. Equilibrium incentive rates are…
Common sense suggests that when individuals explain why they believe something, we can arrive at more accurate conclusions than when they simply state what they believe. Yet, there is no known mechanism that provides incentives to elicit…
AI agents are able to tackle increasingly complex tasks. To achieve more ambitious goals, AI agents need to be able to meaningfully decompose problems into manageable sub-components, and safely delegate their completion across to other AI…
In this article, I will present a paradox whose purpose is to draw your attention to an important topic in finance, concerning the non-independence of the financial returns (non-ergodic hypothesis). In this paradox, we have two people…
Individuals are often faced with temptations that can lead them astray from long-term goals. We're interested in developing interventions that steer individuals toward making good initial decisions and then maintaining those decisions over…
Large language models (LLMs) increasingly support heterogeneous tasks within a single interface, requiring users to form, update, and act upon beliefs about one system across domains with different reliability profiles. Understanding how…
There are many settings in which a principal performs a task by delegating it to an agent, who searches over possible solutions and proposes one to the principal. This describes many aspects of the workflow within organizations, as well as…
People are increasingly subject to algorithmic decisions, and it is generally agreed that end-users should be provided an explanation or rationale for these decisions. There are different purposes that explanations can have, such as…
Large language model-based agents are becoming increasingly popular as a low-cost mechanism to provide personalized, conversational advice, and have demonstrated impressive capabilities in relatively simple scenarios, such as movie…
Everyday decisions often involve many different levels. What connects these higher and lower level decisions hierarchy to one another determines how the cause(s) of failures are interpreted. It is hypothesized that decision confidence…
The valuation process that economic agents undergo for investments with uncertain payoff typically depends on their statistical views on possible future outcomes, their attitudes toward risk, and, of course, the payoff structure itself.…
In this work, we empirically examine human-AI decision-making in the presence of explanations based on predicted outcomes. This type of explanation provides a human decision-maker with expected consequences for each decision alternative at…
The use of artificial intelligence models has recently grown common; we may use them to write lines of code for us, summarize readings, draft emails, or even illustrate images. But when it comes to important decisions we need to make, such…
This article investigates the influence of luck and strategic considerations on performance of teams participating in the M6 investment challenge. We find that there is insufficient evidence to suggest that the extreme Sharpe ratios…
A key feature of human theory-of-mind is the ability to attribute beliefs to other agents as mentalistic explanations for their behavior. But given the wide variety of beliefs that agents may hold about the world and the rich language we…