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Weber's Law and the Biological Evolution of Risk Preferences: The Selective Dominance of the Logarithmic Utility Function

Sinn, Hans-Werner - CESifo - 2002

The paper offers a proof that expected utility maximisation with logarithmic utility is a dominant preference in the biological selection process in the sense that a population following any other preference for decision-making under risk will, with a probability that approaches certainty,...

Persistent link: https://www.econbiz.de/10005765795

International Trade and Cultural Diversity: A Model of Preference Selection

Bala, Vankatesh; Long, Ngo Van - CESifo - 2004

We consider the evolution of preferences when trade occurs between two countries. We show that if one country is much …

Persistent link: https://www.econbiz.de/10005765932

Some Evolutionary Foundations for Price Level Rigidity

Saint-Paul, Gilles - CESifo - 2002

This paper shows that price rigidity evolves in an economy populated by imperfectly rational agents who experiment with alternative rules of thumb. In the model, firms must set their prices in face of aggregate demand shocks. Their payoff depends on the level of aggregate demand, as well as on...

Persistent link: https://www.econbiz.de/10005051547

Long-Run Selection and the Work Ethic

Josephson, Jens; Wärneryd, Karl - CESifo - 2004

That individuals contribute in social dilemma interactions even when contributing is costly is a well-established observation in the experimental literature. Since a contributor is always strictly worse off than a non-contributor the question is raised if an intrinsic motivation to contribute...

Persistent link: https://www.econbiz.de/10005405908

The Agricultural Origins of Time Preference

Galor, Oded; Özak, Ömer - CESifo - 2015

, triggered selection and learning processes that had a persistent positive effect on the prevalence of long-term orientation. …

Persistent link: https://www.econbiz.de/10011167137

When is Ambiguity-Attitude Constant?

Eichberger, Jürgen; Grant, Simon; Kelsey, David - CESifo - 2012

This paper studies how updating affects ambiguity-attitude. In particular we focus on the generalized Bayesian update of the Jaffray-Phillipe sub-class of Choquet Expected Utility preferences. We find conditions for ambiguity-attitude to be the same before and after updating. A necessary and...

Persistent link: https://www.econbiz.de/10010539152

First Impressions Matter: Signalling as a Source of Policy Dynamics

Hansen, Stephen; McMahon, Michael - CESifo - 2012

with experience. We then reject increasing confidence in private information or learning about the structure of the …

Persistent link: https://www.econbiz.de/10010540726

Optimal Monetary Policy when Agents are Learning

Molnár, Krisztina; Santoro, Sergio - CESifo - 2010

We derive the optimal monetary policy in a sticky price model when private agents follow adaptive learning. We show … order to facilitate private sector learning and thus ease the future intratemporal inflation-output gap trade-offs. The … policy recommendation is robust: the welfare loss entailed by the optimal policy under learning if the private sector …

Persistent link: https://www.econbiz.de/10008596587

Rationality, Irrationality and Economic Cognition

Whalley, John - CESifo - 2005

. Learning played a major role in individuals achieving what was referred to as complete rationality. I draw on these ideas, and …

Persistent link: https://www.econbiz.de/10005094429

On the Evolution of Market Institutions: The Platform Design Paradox

Alós-Ferrer, Carlos; Kirchsteiger, Georg; Walzl, Markus - CESifo - 2007

We study competition among market designers who create new trading platforms, when boundedly rational traders learn to select among them. We ask whether efficient platforms, leading to market - clearing trading outcomes, will dominate the market in the long run. If several market designers are...

Persistent link: https://www.econbiz.de/10005406426