This paper explores a model of bounded rationality in evolutionary game play in which agent choice is based on a social psychological process of categorization and social inference. The computer simulation of the model demonstrates that agents' increasing ability to categorize opponents in the...

In the developing world, kidnapping is relatively common, and a market for kidnap insurance has arisen in response. We provide a model that allows us to analyze how kidnap insurance affects the interaction between the kidnapper and the victim’s family when both are self-interested and have...

When rationality is bounded, a variety of factors may influence how far a choice is from optimal. We examine the willingness to search among alternatives. We find fixed individual differences in this temperament measure. People may be usefully typed according to how they obtain improved choices....

Testing whether risk professionals (here insurers) behave differently under risk and ambiguity when they cover catastrophic risks (floods and earthquakes) and non-catastrophic risks (fires), this paper reports the results of the first field experiment in the United States designed to distinguish...

This paper analyzes the effect of information overload on preference or aversion for variety. According to the model, a rational decision maker who suffers from information overload, faces a two-stage decision process, and is choosing from a set of unknown goods will find it optimal at some...