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Adaptive Agents May Be Smarter than You Think : Unbiasedness in Adaptive Expectations

Palestrini, Antonio; Gallegati, Mauro; Delli Gatti, Domenico - 2021

Agents forming adaptive expectations generally make systematic mistakes. This characterization has fostered the rejection of adaptive expectations in macroeconomics. Experimental evidence, however, shows that in complex environments human subjects frequently rely on adaptive heuristics –...

Persistent link: https://www.econbiz.de/10013217385

Heterogeneous Information, Subjective Model Beliefs, and the Time-Varying Transmission of Shocks

Macaulay, Alistair - 2022

Using a novel decomposition, I show that systematic relationships between information and subjective models across agents distort the aggregate transmission of shocks in a general class of macroeconomic models. I document evidence of such a systematic correlation between household information...

Persistent link: https://www.econbiz.de/10013289696

Foreign Influence and Domestic Policy : A Survey

Aidt, Toke Skovsgaard - 2019

In an interconnected world, economic and political interests inevitably reach beyond national borders. Since policy choices generate external economic and political costs, foreign state and non-state actors have an interest in inflencing policy actions in other sovereign countries to their...

Persistent link: https://www.econbiz.de/10012889683

International Trade and Stable Resolutions of Resource Disputes

Garfinkel, Michelle R.; Syropoulos, Constantinos - 2022

We consider a dynamic setting in which two sovereign states with overlapping ownership claims on a resource/asset ﬁrst arm and then choose whether to resolve their dispute violently through war or peacefully through settlement. Both approaches depend on the states’ military capacities, but...

Persistent link: https://www.econbiz.de/10014243081

Trade, Insecurity, and the Costs of Conflict

Garfinkel, Michelle R.; Skaperdas, Stergios; … - 2022

Typically, economics assumes that property rights over productive resources or goods are perfectly defined and costlessly enforced. The costs of insecurity and the resultant conflict are, however, real and often economically significant. In this paper, we examine how international trade regimes...

Persistent link: https://www.econbiz.de/10014243087

The Dynamics of Households' Stock Market Beliefs

Gaudecker, Hans-Martin von - 2019

We analyse a long panel of households’ stock market beliefs to gain insights into the nature of their expectations formation processes. We classify respondents into one of five groups based on their data and estimate group-wise models of expectations formation. Two of the groups are at...

Persistent link: https://www.econbiz.de/10012871761

Beliefs about the Stock Market and Investment Choices: Evidence from a Field Experiment

Laudenbach, Christine; Weber, Annika; Wohlfart, Johannes - 2021

We survey retail investors at an online bank to study beliefs about the autocorrelation of aggregate stock returns, and how these beliefs shape investment decisions measured in administrative account data. Individuals’ beliefs exhibit substantial heterogeneity and predict trading responses to...

Persistent link: https://www.econbiz.de/10012799727

Beliefs About the Stock Market and Investment Choices : Evidence from a Field Experiment

Laudenbach, Christine; Weber, Annika; Wohlfart, Johannes - 2021

Persistent link: https://www.econbiz.de/10013312861

A Comparison of Regret Theory and Salience Theory for Decisions under Risk

Herweg, Fabian - 2020

Two non-transitive theories to model decision making under risk are regret theory (Loomes and Sugden, 1982, 1987) and … salience theory (Bordalo, Gennaioli, and Shleifer, 2012). While the psychological underpinning of these two approaches is … of choice behavior. We investigate the overlap between these theories and show that original regret theory (Loomes and …

Persistent link: https://www.econbiz.de/10012850081

Endogenous Risk Attitudes

Netzer, Nick; Robson, Arthur J.; Steiner, Jakub; … - 2022

perception frictions. The model explains adaptive risk attitudes and probability weighting as in prospect theory and …

Persistent link: https://www.econbiz.de/10013306853

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