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On Inferring Demand for Health Care in the Presence of Anchoring, Acquiescence, and Selection Biases
Bhattacharya, Jay - 2008
In the contingent valuation literature, both anchoring and acquiescence biases pose problems when using an iterative … bidding game to infer willingness to pay. Anchoring bias occurs when the willingness to pay estimate is sensitive to the … initially presented starting value. Acquiescence bias occurs when survey respondents exhibit a tendency to answer 'yes' to …
Persistent link: https://www.econbiz.de/10012464782
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Information Favoritism and Scoring Bias in Contests
Deng, Shanglyu; Fang, Hanming; Fu, Qiang; Wu, Zenan - National Bureau of Economic Research - 2023
information is symmetrically distributed and the scoring bias is set to offset the initial asymmetry between players …
Persistent link: https://www.econbiz.de/10014247957
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Dampening General Equilibrium : Incomplete Information and Bounded Rationality
Angeletos, Marios; Lian, Chen - National Bureau of Economic Research - 2022
We review how realistic frictions in information and/or rationality arrest general equilibrium (GE) feedbacks. In one specification, we maintain rational expectations but remove common knowledge of aggregate shocks. In another, we replace rational expectations with Level-k Thinking or a smooth...
Persistent link: https://www.econbiz.de/10012938745
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Equilibrium Analysis in the Behavioral Neoclassical Growth Model
Acemoglu, Daron - 2018
Rich behavioral biases, mistakes and limits on rational decision-making are often thought to make equilibrium analysis …, behavioral biases matter for long-run equilibrium if and only if they change the direction of the direct response. We show that …
Persistent link: https://www.econbiz.de/10012481011
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Confidence and the Propagation of Demand Shocks
Angeletos, George-Marios - 2020
We revisit the question of why shifts in aggregate demand drive business cycles. Our theory combines intertemporal substitution in production with rational confusion (or bounded rationality) in consumption. The first element allows aggregate supply to respond to shifts in aggregate demand...
Persistent link: https://www.econbiz.de/10012481250
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Satisficing Contracts
Bolton, Patrick - 2009
We propose a model of equilibrium contracting between two agents who are "boundedly rational" in the sense that they face time-costs of deliberating current and future transactions. We show that equilibrium contracts may be incomplete and assign control rights: they may leave some enforceable...
Persistent link: https://www.econbiz.de/10012463995
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Who Misvotes? The Effect of Differential Cognition Costs on Election Outcomes
Shue, Kelly - 2006
If voters are fully rational and have negligible cognition costs, ballot layout should not affect election outcomes. In this paper, we explore deviations from rational voting using quasi-random variation in candidate name placement on ballots from the 2003 California Recall Election. We find...
Persistent link: https://www.econbiz.de/10012465951
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Paternalism and Psychology
Glaeser, Edward L. - 2005
Does bounded rationality make paternalism more attractive? This Essay argues that errors will be larger when suppliers have stronger incentives or lower costs of persuasion and when consumers have weaker incentives to learn the truth. These comparative statics suggest that bounded rationality...
Persistent link: https://www.econbiz.de/10012466882
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Debiasing through Law
Jolls, Christine - 2005
In many settings, human beings are boundedly rational. A distinctive and insufficiently explored legal response to bounded rationality is to attempt to "debias through law," by steering people in more rational directions. In many important domains, existing legal analyses emphasize the...
Persistent link: https://www.econbiz.de/10012466934
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A Unified Theory of Underreaction, Momentum Trading and Overreaction in Asset Markets
Hong, Harrison - 1997
We assume that the instantaneous riskless rate reverts towards a central tendency which in turn, is changing stochastically over time. As a result, current short-term rates are not" sufficient to predict future short-term rates movements, as would be the case if the central" tendency was...
Persistent link: https://www.econbiz.de/10012472491