5 research outputs found
Decisions with endogenous frames
We develop a model of decision-making with endogenous frames and contrast the normative implications of our model to those of choice theoretic models
in which observed choices are determined by exogenous frames or ancillary conditions. We argue that, frames, though they may be taken as given by the
decision-maker at the point when choices are made, matter for both welfare and policy purposes
Decisions with Endogenous Frames
This paper contrasts the normative implications of a model of decisionmaking with endogenous frames to those of choice theoretic models of Bernheim and Rangel (2007, 2009) and Rubinstein and Salant (2008) in which observed choices are determined by exogenous frames or ancillary conditions. We argue that frames, though exogenous to the individual at the point when choices are made, matter for welfare purposes.Decisions, choice, frames, standard, behavioral, welfare
Characterizing behavioral decisions with choice data
This paper provides an axiomatic characterization of choices in a setting where a
decision-maker may not fully internalize all the consequences of her choices on herself.
Such a departure from rationality, it turns out, is common across a variety of positive
behavioral models and admits the standard rational choice model as a special case. We
show that choice data satisfying (a) SenÃs axioms if and
fully characterize behavioral
decisions, and (b) SenÃs axiom if and if fully characterize standard decision-making. In
addition, we show that (a) it is possible to identify a minimal and a maximal set of
psychological states using choice data alone, and (b) under specific choice scenarios,
"revealed mistakes" can be inferred directly from choice data
Complementarity with complete but P-acyclic preferences
This paper extends the formulation of complementarity in Milgrom and Shannon (1994) to the case of complete but P-acyclic preferences. In such a case, quasi-supermodularity and the single-crossing property on their own do not guarantee monotone comparative statics or equilibrium existence: an additional condition, monotone closure, is required. (C) 2011 Elsevier B.V. All rights reserved
Complementarity with complete but P-acyclic preferences
This paper extends the formulation of complementarity in Milgrom and Shannon (1994) to the case of complete but P-acyclic preferences. In such a case, quasi-supermodularity and the single-crossing property on their own do not guarantee monotone comparative statics or equilibrium existence: an additional condition, monotone closure, is required.