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The weak rationality principle in economics

Kirchgässner, Gebhard (contributor) - 2005

The weak rationality principle is not an empirical statement but a heuristic rule of how to proceed in social sciences …-foundation and, therefore, employ the rationality assumption in economic models. Then, with reference to the ‘bounded rationality … a part of the rationality assumption. We conclude with some remarks on handling the problems of ‘free will’ as well as …

Persistent link: https://www.econbiz.de/10002730896

Endogenous public information and welfare

Vives, Xavier - 2011

This paper performs a welfare analysis of economies with private information when public information is endogenously generated and agents can condition on noisy public statistics in the rational expectations tradition. We find that equilibrium is not (restricted) efficient even when feasible...

Persistent link: https://www.econbiz.de/10009153832

Behavioral political economy : a survey

Schnellenbach, Jan; Schubert, Christian - 2014

Explaining individual behavior in politics should rely on the same motivational assumptions as explaining behavior in the market: That’s what Political Economy, understood as the application of economics to the study of political processes, is all about. In its standard variant, those who...

Persistent link: https://www.econbiz.de/10010412852

Equilibrium and efficiency in the tug-of-war

Konrad, Kai A. (contributor); … - 2005

We characterize the unique Markov perfect equilibrium of a tug-of-war without exogenous noise, in which players have the opportunity to engage in a sequence of battles in an attempt to win the war. Each battle is an all-pay auction in which the player expending the greater resources wins. In...

Persistent link: https://www.econbiz.de/10003202472

Electoral competition with rationally inattentive voters

Matĕjka, Filip; Tabellini, Guido Enrico - 2016 - This version: January 2016

How do voters allocate costly attention to alternative political issues? And how does selective ignorance of voters interact with policy design by politicians? We address these questions by developing a model of electoral competition with rationally inattentive voters. Rational inattention...

Persistent link: https://www.econbiz.de/10011451105

Restraining the genuine homo economicus : why the economy cannot be divorced from its governance

Skaperdas, Stergios - 2003

The Homo economicus of traditional economics is far from being completely self-interested, rational, or as individualistic as he is purported to be; he will haggle to death over price but will not take what he wants by force. Implicitly, he is assumed to behave ruthlessly within a welldefined...

Persistent link: https://www.econbiz.de/10011507656

Theories of fairness and reciprocity : evidence and economic applications

Fehr, Ernst; Schmidt, Klaus M. - 2000

Most economic models are based on the self-interest hypothesis that assumes that all people are exclusively motivated by their material self-interest. In recent years experimental economists have gathered overwhelming evidence that systematically refutes the self-interest hypothesis and suggests...

Persistent link: https://www.econbiz.de/10011397676

Approximate expected utility rationalization

Echenique, Federico; Imai, Taisuke; Saito, Kota - 2018

deviation (in beliefs, utility, or perceived prices) is within e of expected utility theory. The number e can then be used as a … distance to the theory. We apply our methodology to three recent large-scale experiments. Many subjects in those experiments …

Persistent link: https://www.econbiz.de/10011931433

Quantifying qualitative survey data : new insights on the (ir)rationality of firms' forecasts

Botsis, Alexandros; Görtz, Christoph; Sakellarēs, … - 2020

Using a novel dataset that contains qualitative firm survey data on sales forecasts as well as balance-sheet data on realized sales, we document that only major forecast errors are predictable and display autocorrelation. This result is a particular violation of the Full Information Rational...

Persistent link: https://www.econbiz.de/10012174792

Boundedly rational decision emergence : a general perspective and some selective illustrations

Güth, Werner - 2000

A general framework is described specifying how boundedly rational decision makers generate their choices. Starting from a Master Module which keeps an inventory of previously successful and unsuccessful routines several submodules can be called forth which either allow one to adjust behavior...

Persistent link: https://www.econbiz.de/10009781608