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Prizes versus Wages with Envy and Pride
Dubey, Pradeep K.; Geanakoplos, John; Haimanko, Ori - Cowles Foundation for Research in Economics, Yale University - 2005
We show that if agents are risk neutral, prizes outperform wages when there is sufficient pride and envy relative to the noisiness of performance. If agents are risk averse, prizes are a necessary supplement to wages (as bonuses).
Persistent link: https://www.econbiz.de/10005762713
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Prizes versus Wages with Envy and Pride
Dubey, Pradeep; Geanakoplos, John; Haimanko, Ori - Cowles Foundation for Research in Economics, Yale University - 2011
We show that if agents are risk neutral, prizes outperform wages if and only if there is sufficient pride and envy relative to the noisiness of performance. If agents are risk averse, prizes are a necessary supplement to wages (as bonuses).
Persistent link: https://www.econbiz.de/10009371331
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Promises and Expectations
Ederer, Florian; Stremitzer, Alexander - Cowles Foundation for Research in Economics, Yale University - 2013
We investigate why people keep their promises in the absence of external enforcement mechanisms and reputational effects. In a controlled laboratory experiment we show that exogenous variation of second-order expectations (promisors' expectations about promisees' expectations that the promise...
Persistent link: https://www.econbiz.de/10011252589
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Optimally Empty Promises and Endogenous Supervision
Miller, David A.; Rozen, Kareen - Cowles Foundation for Research in Economics, Yale University - 2011
We study optimal contracting in team settings, featuring stylized aspects of production environments with complex tasks. Agents have many opportunities to shirk, task-level monitoring is needed to provide useful incentives, and because it is difficult to write individual performance into formal...
Persistent link: https://www.econbiz.de/10009321766
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Behavioral Heterogeneity and Cournot Oligopoly Equilibrium
Grandmont, Jean-Michel - Cowles Foundation for Research in Economics, Yale University - 1993
It is not infrequent to see studies of imperfect competition or of industrial organization rest upon questionable foundations such as the hypothesis that inverse market demand is, whenever it is positive, concave or even linear. Assumptions of this sort are not robust (i.e., "additive") in the...
Persistent link: https://www.econbiz.de/10005093932
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Rationalization and Cognitive Dissonance: Do Choices Affect or Reflect Preferences?
Chen, M. Keith - Cowles Foundation for Research in Economics, Yale University - 2008
choice-induced dissonance. In contrast to the economic approach of assuming a person's choices reveal their preferences … studies actually reject the presence of choice-induced dissonance. This suggests that mere choice may not always induce …
Persistent link: https://www.econbiz.de/10005087405
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Bounded Rationality and Limited Datasets
Clippel, Geoffroy de; Rozen, Kareen - Cowles Foundation for Research in Economics, Yale University - 2012
testing choice theories with limited data. …
Persistent link: https://www.econbiz.de/10009653367
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Affective Decision-Making: A Theory of Optimism-Bias
Bracha, Anat; Brown, Donald J. - Cowles Foundation for Research in Economics, Yale University - 2010
Optimism-bias is inconsistent with the independence of decision weights and payoffs found in models of choice under … optimistically biased, we propose an alternative model of risky choice, affective decision-making, where decision weights -- which we … label affective or perceived risk -- are endogenized. Affective decision making (ADM) is a strategic model of choice under …
Persistent link: https://www.econbiz.de/10008503142
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Affective Decision Making: A Behavioral Theory of Choice
Bracha, Anat; Brown, Donald J. - Cowles Foundation for Research in Economics, Yale University - 2007
Affective decision-making (ADM) is a refutable and predictive theory of individual choice under risk and uncertainty … "emotional" process. Observed choice is the result of their simultaneous interaction. We present a model of affective choice in …
Persistent link: https://www.econbiz.de/10005463861
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Affective Decision Making: A Behavioral Theory of Choice
Bracha, Anat; Brown, Donald J. - Cowles Foundation for Research in Economics, Yale University - 2007
Affective decision-making is a strategic model of choice under risk and uncertainty where we posit two cognitive … processes — the "rational" and the "emotional" process. Observed choice is the result of equilibirum in this intrapersonal game …
Persistent link: https://www.econbiz.de/10005593233