The demonstration by Smith [1962] that prices and allocations quickly converge to the competitive equilibrium in the continuous double auction (CDA) was one of the first – and remains one of the most important results in experimental economics. His initial experiment, subsequent market...

This paper advances the claim that ignoring relevant information is sometimes consistent with good decision making. Although that finding is not new, the argument presented here is. In contrast with bounded rationality models, the decision-making model in this paper presupposes no cognitive...

This paper describes the results of an experiment applying the strategy method to analyze the behavior of subjects in an 8-player common pool resource (CPR) game. The CPR game consists of a constituent game played for 20 periods. The CPR game has a unique optimum and a unique subgame perfect...

The Nobel Prize in Economics was awarded to Herbert Simon in 1978. At Carnegie Mellon University he holds the title of Professor of Computer Science and Psychology. These two facts together delineate the range and uniqueness of his contributions in creating meaningful interactions among fields...

In a complex and uncertain world, humans and animals make decisions under the constraints of limited knowledge, resources, and time. Yet models of rational decision making in economics, cognitive science, biology, and other fields largely ignore these real constraints and instead assume agents...

A simulation model is used to construct a regime of artificial economic evolution, where Schumpeterian process competition prevails, in the presence of technological uncertainty and bounded rationality. The output decision of the firm is represented by a behavioural algorithm, which allows for...

The article presents a general model of action based on Hartmut Esser' s theory of frame-selection, which overcomes the central objections to the previous formalizations of the theory. This model explains how an actor defines a situation (frame-selection), which program of action he activates...

The theory of melioration, originally formulated for individual decision-making contexts, is formally extended to a game theoretic framework. This paper proves the existence of a distribution that is a melioration strategy on the part of all players. Further, the question of stability of such a...