Regret and its anticipation affect a wide range of decisions. Job-seekers reject offers while waiting for an offer to match their best past offer; investors hold on to badly performing stocks; and managers throw good money after bad projects. We analyze behavior of a decision-maker with...

We study matching policies in a dynamic exchange market with random compatibility, in which some agents are easier to match than others. In steady state this asymmetry creates an endogenous imbalance: hard-to-match agents wait for partners, while easy-to-match agents can match almost immediately...

Prospect theory is arguably the most prominent alternative to expected utility theory. We study the investment or gambling behavior of a prospect theory decision maker who is aware of his time-inconsistency but lacks commitment. For the empirically relevant prospect theory specifications, we...

Timing decisions are common: when to file your taxes, finish a referee report, or complete a task at work. We ask whether time preferences can be inferred when only task completion is observed. To answer this question, we analyze the following model: each period a decision maker faces the choice...

We explore the learning process and behavior of an individual with unrealistically high expectations (“overconfidence”) when outcomes also depend on an external fundamental that affects the optimal action. Moving beyond existing results in the literature, we show that the agent's beliefs...

Many economic situations involve the timing of irreversible decisions. E.g. People decide when to sell a stock or stop searching for a better price. We analyze the behavior of a decision maker who evaluates his choice relative to the ex-post optimal choice in an optimal stopping task. We derive...

A designer allocates several indivisible objects to a stream of randomly arriving agents. The long-lived agents are privately informed about their value for an object, and about their arrival time to the market. The designer learns about future arrivals from past arrivals, while agents...

Bitcoin's main innovation lies in allowing a decentralized system that relies on anonymous, profit driven miners who can freely join the system. We formalize these properties in three axioms: anonymity of miners, no incentives for miners to consolidate, and no incentive to assuming multiple...

A key part of decentralized consensus protocols is a procedure for random selection, which is the source of the majority of miners cost and wasteful energy consumption in Bitcoin. We provide a simple economic model for random selection mechanism and show that any PoW protocol with natural...