In standard rational choice modelling decisions are made according to given information and preferences. In the model presented here the 'information technology' of individual decision makers as well as their preferences evolve in a dynamic process. In this process decisions are made rationally...

We study a new type of representation problem for optional processes with connections to singular control, optimal stopping and dynamic allocation problems. As an application, we show how to solve a variant of Skorohod's obstacle problem in the context of backward stochastic differential...

We introduce and analyse numerical methods for the treatment of inverse problems, based on an adaptive wavelet Galerkin discretization. These methods combine the theoretical advantages of the wavelet-vaguelette decomposition (WVD) in terms of optimally adapting to the unknown smoothness of the...

Studying evolutionarily successful behavior we show in a general framework that when individuals maximizing payoff differentials invest resources in punishing others. Interestingly, these investments are increasing in individuals, own wealth and decreasing in the wealth of others.

The findings on the ultimatum game are considered as belonging to the most robust experimental results. In this paper we present a slightly altered version of the mini ultimatum game of Bolton and Zwick (1995). Whereas in the latter exactly equal splits were feasible in our games these were...

The study of evolutionary dynamics was so far mainly restricted to finite strategy spaces. In this paper we show that this restriction is in most cases unnecessary. We give a mild condition under which the continuous time replicator dynamics are well defined for infinite strategy spaces....

Whoever exists belongs to a species, which did not become extinct, has a (geno-) type, which should be well adjusted, and lives in a habitat which has been sustainable for a long time. To capture the first aspect we allow for interspecies competition and analyze the conditions for species...

We analyze the dynamics of a game of sequential bidding in the presence of stochastic scale effects in the form of stochastic economies or diseconomies of scale. We show that economies give rise to declining expected equilibrium prices, whereas the converse is not generally true. Moreover,...