Book ChapterDOI
Rationality for Economists
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The authors argue that most cognitive anomalies operate through errors in perception that arise from the way information is stored, retrieved, and processed, or through the errors in process that lead to formulation of choice problems.Abstract:
Rationality is a complex behavioral theory that can be parsed into statements about preferences, perceptions, and process. This paper looks at the evidence on rationality that is provided by behavioral experiments, and argues that most cognitive anomalies operate through errors in perception that arise from the way information is stored, retrieved, and processed, or through errors in process that lead to formulation of choice problems as cognitive tasks that are inconsistent at least with rationality narrowly defined. The paper discusses how these cognitive anomalies influence economic behavior and measurement, and their implications for economic analysis.read more
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Book
Heuristics and Biases: The Psychology of Intuitive Judgment
TL;DR: In this article, a review is presented of the book "Heuristics and Biases: The Psychology of Intuitive Judgment, edited by Thomas Gilovich, Dale Griffin, and Daniel Kahneman".
Journal ArticleDOI
Individual differences in reasoning: Implications for the rationality debate?
TL;DR: In this paper, the authors examined the implica- tions of individual differences in performance for each of the four explanations of the normative/descriptive gap, including performance errors, computational limitations, the wrong norm being applied by the experi- menter, and a different construal of the task by the subject.
Book ChapterDOI
Representativeness revisited: Attribute substitution in intuitive judgment.
Daniel Kahneman,Shane Frederick +1 more
TL;DR: The program of research now known as the heuristics and biases approach began with a survey of 84 participants at the 1969 meetings of the Mathematical Psychology Society and the American Psychological Association (Tversky & Kahneman, 1971) as discussed by the authors.
Book ChapterDOI
The affect heuristic
TL;DR: This article introduced a theoretical framework that describes the importance of affect in guiding judgments and decisions and argued that reliance on such feelings can be characterized as "the affect heuristic" and discussed some of the important practical implications resulting from ways that this heuristic impacts our daily lives.
Journal ArticleDOI
Incentive and informational properties of preference questions
TL;DR: The authors applied the standard neoclassical economic framework to generate predictions about how rational agents would answer such survey questions, which in turn implies how such survey data should be interpreted, and compared different survey formats with respect to the information that the question itself reveals to the respondent, the strategic incentives the respondent faces in answering the question, and the information revealed by the respondent's answer.
References
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Book ChapterDOI
Prospect theory: an analysis of decision under risk
Daniel Kahneman,Amos Tversky +1 more
TL;DR: In this paper, the authors present a critique of expected utility theory as a descriptive model of decision making under risk, and develop an alternative model, called prospect theory, in which value is assigned to gains and losses rather than to final assets and in which probabilities are replaced by decision weights.
Book
Judgment Under Uncertainty: Heuristics and Biases
Amos Tversky,Daniel Kahneman +1 more
TL;DR: The authors described three heuristics that are employed in making judgements under uncertainty: representativeness, availability of instances or scenarios, and adjustment from an anchor, which is usually employed in numerical prediction when a relevant value is available.
Journal ArticleDOI
Prospect theory: analysis of decision under risk
Daniel Kahneman,Amos Tversky +1 more
Book
A Theory of Cognitive Dissonance
TL;DR: Cognitive dissonance theory links actions and attitudes as discussed by the authors, which holds that dissonance is experienced whenever one cognition that a person holds follows from the opposite of at least one other cognition that the person holds.
Book
Theory of Games and Economic Behavior
TL;DR: Theory of games and economic behavior as mentioned in this paper is the classic work upon which modern-day game theory is based, and it has been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations.