Thompson Sampling as a theory of human behavior across very different situations of dynamic strategic interaction in economics … Bayesian learning and quantal response equilibrium (QRE) - above all in complex environments with many possible actions. …

may or may not coordinate on the rational equilibrium outcome. A general finding is that under positive expectations … feedback (strategic complementarity) - where optimistic (pessimistic) expectations can cause a boom (bust) - coordination … by coordination on trend-following behavior leading to (almost-)self-fulfilling equilibria. Heterogeneous expectations …