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The standard model of rational risky decision-making
Falahati, Kazem - In: Journal of risk and financial management : JRFM 14 (2021) 4, pp. 1-22
Expected utility theory (EUT) is currently the standard framework which formally defines rational decision-making under risky conditions. EUT uses a theoretical device called von Neumann-Morgenstern utility function, where concepts of function and random variable are employed in their...
Persistent link: https://www.econbiz.de/10012520657
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The economic behavior of human beings : the institutional/post-Keynesian model
Fernández-Huerga, Eduardo - In: Journal of economic issues : jei 42 (2008) 3, pp. 709-726
Persistent link: https://www.econbiz.de/10003763155
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Limited attention in case-based belief formations
Bleile, Jörg - 2014
An agent wants to derive her belief over outcomes based on past observations collected in her database (memory). There is well establish evidence in the psychology and marketing literature that agents consistently fail (or choose not) to process all available information. An agent might be...
Persistent link: https://www.econbiz.de/10010403098
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Consumer Choice Rule While Examing Similar Consumption Bundles : Rational Choice to Behavioural Bias
Vikramaditya, Vibhu - 2021
The study tries to recognize the behaviour of the consumer with respect to the opportunity cost and marginal benefit associated with the commodity. The research tries to evaluate the factors and identify behavioural traits of consumers if they exist in decision making. The study also tries to...
Persistent link: https://www.econbiz.de/10013237102
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On rational choice and the representation of decision problems
Oliva, Paulo; Zahn, Philipp - In: Games 12 (2021) 4, pp. 1-21
In economic theory, an agent chooses from available alternatives-modeled as a set. In decisions in the field or in the lab, however, agents do not have access to the set of alternatives at once. Instead, alternatives are represented by the outside world in a structured way. Online search results...
Persistent link: https://www.econbiz.de/10012698098
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List-rationalizable choice
Yıldız, Kemal - In: Theoretical economics : TE ; an open access journal in … 11 (2016) 2, pp. 587-599
the formulation of list rationality to stochastic choice setup. We say two alternatives are related if the \textit …. By using this characterization, we relate list rationality to two-stage choice procedures. …
Persistent link: https://www.econbiz.de/10011672005
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Heuristics and public policy : decision making under bounded rationality
Dhami, Sanjit S.; Al-Nowaihi, Ali; Sunstein, Cass R. - 2018
How do human beings make decisions when, as the evidence indicates, the assumptions of the Bayesian rationality … rationality, with particular emphasis on growing formalization of those departures, which add necessary precision. We also explore … the relationship between bounded rationality and libertarian paternalism, or nudges, and show that some recent objections …
Persistent link: https://www.econbiz.de/10011926917
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What Simon says
Heukelom, Floris - 2006
degree of rationality that is higher than which can be attained by the individual. In this realm his main preoccupation are …
Persistent link: https://www.econbiz.de/10011350370
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The Similarity Effect : A Consequence of Rational Choice
Steenburgh, Thomas J. - 2014
This paper highlights a logical contradiction in the currently accepted theory of choice. This contradiction occurs when a decision is reframed by adding a clone to the choice set. The current theory concludes that individuals have context-dependent preferences if they make consistent choices;...
Persistent link: https://www.econbiz.de/10014038934
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Axiom preferences and choice mistakes under risk
Herweg, Fabian; Hippel, Svenja; Müller, Daniel; … - 2024
We investigate whether violations of canonical axioms of choice under risk are mistakes or a manifestation of true preferences. First, we elicit axiom and gamble preferences and then allow subjects to revise their potentially conflicting preferences. Among the behavioral patterns that allow for...
Persistent link: https://www.econbiz.de/10014578322