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Innovation Adoption by Forward-Looking Social Learners
Frick, Mira - 2015
Motivated by the rise of social media, we build a model studying the effect of an economy's potential for social learning on the adoption of innovations of uncertain quality. Provided consumers are forward-looking (i.e., recognize the value of waiting for information), equilibrium dynamics...
Persistent link: https://www.econbiz.de/10013027942
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Dynamic Random Utility
Frick, Mira - 2018
We provide an axiomatic analysis of dynamic random utility, characterizing the stochastic choice behavior of agents who solve dynamic decision problems by maximizing some stochastic process (U_t) of utilities. We show first that even when (U_t) is arbitrary, dynamic random utility imposes new...
Persistent link: https://www.econbiz.de/10012908509
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Dynamic Random Utility
Frick, Mira - 2017
Under dynamic random utility, an agent (or population of agents) solves a dynamic decision problem subject to evolving private information. We analyze the fully general and non-parametric model, axiomatically characterizing the implied dynamic stochastic choice behavior. A key new feature...
Persistent link: https://www.econbiz.de/10012953649
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Experimental Persuasion
Ball, Ian; Espín-Sánchez, José-Antonio - 2021
We introduce experimental persuasion between Sender and Receiver. Sender chooses an experiment to perform from a feasible set of experiments. Receiver observes the realization of this experiment and chooses an action. We characterize optimal persuasion in this baseline regime and in an...
Persistent link: https://www.econbiz.de/10013215572
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Intergenerational Justice When Future Worlds are Uncertain
Llavador, Humberto - 2015
Suppose that there exists a positive (exogenous) probability that at each date of a possibly infinite future, the human species will disappear. We postulate an Ethical Observer (EO) who must solve an intertemporal welfare maximization problem under this kind of uncertainty, with preferences that...
Persistent link: https://www.econbiz.de/10012749807
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Risky Curves : From Unobservable Utility to Observable Opportunity Sets
Friedman, Daniel - 2017
Most theories of risky choice postulate that a decision maker maximizes the expectation of a Bernoulli (or utility or similar) function. We tour 60 years of empirical search and conclude that no such functions have yet been found that are useful for out-of-sample prediction. Nor do we find...
Persistent link: https://www.econbiz.de/10012975977
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Affective Utilities : A Rational Theory of Optimistic Bias in Asset Markets
Bracha, Anat - 2014
, defined as the composition of the investor's attitudes for risk and her attitudes for ambiguity. Bulls and bears are defined …
Persistent link: https://www.econbiz.de/10013051869
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Optimal Electoral Timing : Exercise Wisely and You May Live Longer
Keppo, Jussi - 2007
The timing of elections is flexible in many countries. We study this optimization, by first creating a Bayesian learning model of a mean-reverting political support process. We then explore optimal electoral timing, modeling it as a renewable American option with interacting waiting and stopping...
Persistent link: https://www.econbiz.de/10012778501
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Probabilistic Sophistication and Stochastic Monotonicity in the Savage Framework
Grant, Simon - 2007
Machina amp; Schmeidler (1992) show that probabilistic sophistication can be obtained in a Savage setting without imposing expected utility by dropping Savage's axiom P2 (sure-thing principle) and strengthening his axiom P4 (weak comparative probability). Their stronger axiom, however, embodies...
Persistent link: https://www.econbiz.de/10012776311
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Boolean Representations of Preferences under Ambiguity
Frick, Mira - 2019
We propose a class of multiple-prior representations of preferences under ambiguity where the belief the decision … Optimism. The model does not restrict the sign of the DM's ambiguity attitude, and we show that it provides a unified framework … through which to characterize different degrees of ambiguity aversion, as well as to represent context-dependent negative and …
Persistent link: https://www.econbiz.de/10012866192