Kovach, Matthew - In: Theoretical economics : TE ; an open access journal in … 15 (2020) 3, pp. 989-1022
wishful thinking (WT), in which an endowed alternative, or status quo, influences the agent's beliefs over states and thus … quo alternatives when the status quo changes. WT leads to inefficient risk sharing in an exchange economy and has unique … choice behavior and provides a coherent explanation for a variety of observed behavior, including choice reversals among non-status …