Recent papers by Cox and Sadiraj (2006) and Rubinstein (2006) have pointed out that expected utility theory is more general than has sometimes been acknowledged, and can hence not be refuted as easily by means of experiments. While acknowledging this fact, this note nevertheless demonstrates...

Turbulent environment can create crises that management has to soles in a limited time with critical decisions. Critical decisions are an attempt to apply efficient modes of cognition and action to enable the organization to cope with consequential environmental threats or take advantage of...

This paper develops a decision-theoretic framework to study rational inattention (Sims [1998, 2003]). We provide an axiomatic characterization that relates rationally inattentive behavior to attitudes towards flexibility (Kreps [1979]) and temporal resolution of uncertainty (Kreps and Porteus...

Current time allocation and household production models face three major weaknesses: First, they only describe the average time allocation. Thus, information about the order of activities is lost. Therefore, it is impossible to describe the influence of activities on later ones. Such...

This paper suggests a new explanation for the low level of annuitization, which is valid even if one assumes perfect markets. We show that, as soon there exists a positive bequest motive, sufficiently risk averse individuals should not purchase annuities. A model calibration accounting for...

The paper develops an axiomatic framework for rational decision making. The von Neumann-Morgenstern axioms give rise to a richer risk attitude than that captured in the standard discounted expected utility model. I derive three models that permit a more comprehensive risk evaluation. These...

This article studies the causal effect of education on decision-making. In 1972 England raised its minimum school-leaving age from 15 to 16 for students born after September 1, 1957. An online survey was conducted with 2,700 individuals born in a 36-month window on either side of this date....