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Rational agents must perform backwards induction by thinking contingently about future states and actions, but failures of backwards induction and contingent reasoning are ubiquitous. How do boundedly-rational agents make decisions when they fail to correctly forecast actions in the future? We...
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expectations with the ones obtained in the forward-looking version under bounded rationality. For the latter, we assume …
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The notion of bounded rationality has received a considerable attention in the midst of debate over the usefulness of … open up new possibilities for estimating bounded rationality models and policy analysis. …
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