Behavioral Economics Commons^™

Decision-Making In Simultaneous Games: Reviewing The Past For The Future, Mohsen Ahmadian, Ehsan Elahi, Roger Blake

Mohsen Ahmadian

Behavioral Economics And Poverty [En Español] Behavioral Economics Y Pobreza, Daniel A. Monroy

Daniel A Monroy C

No abstract provided.

Behavioral Economics Y Políticas Públicas: Algunos Problemas Y Sus Soluciones / Behavioral Economics And Public Policies: Some Problems And Their Solutions [En Español], Daniel A. Monroy

Daniel A Monroy C

Abstract

The main target of this paper is to show a behavioral economics approach to –some– public policies from a descriptive and a normative point of view. To meet the target, (i) the paper summarizes two cognitive biases: the status quo bias and the endowment effect, and then shows how these biases could affect the effectiveness of public policies in some relevant contexts: the availability of human organs for transplantation; people's bad eating habits; and environmental resources management. In addition, (ii) the paper suggests some strategies (nudges) about how behavioral economics could inform policy maker to design or to improve …

No Endowment Effect When People Transact Secondhand Goods Over The Internet, Sergio Da Silva, Raul Matsushita, Eliza Silveira

Sergio Da Silva

We set up a field experiment of the endowment effect by considering thrift shops in Facebook chat rooms and college chat rooms dedicated to secondhand goods transactions. Owners of goods held for use are generally expected to show the endowment effect, but here we show these very owners (most of them females) switch to a trader-like behavior when conducting transactions in the thrift shops and, as a result, the endowment effect vanishes.

Handedness And Digit Ratio Predict Overconfidence In Cognitive And Motor Skill Tasks In A Sample Of Preschoolers, Sergio Da Silva, Bruno Moreira, Newton Da Costa Jr

Sergio Da Silva

In a sample of 141 preschoolers, ages 4 to 6, we find children display overconfidence in cognitive and motor skill tasks, a result that replicates that of adults. Both set of findings suggest the bias may not be learned behavior. Moreover, we find right-handed children to display more overconfidence in the cognitive task, whereas low digit-ratio children show more overconfidence in fine and gross motor skill tasks. Handedness polymorphism has been linked to neurological differences, and in literature low digit ratios are commonly associated with high fetal testosterone.

Anchoring Heuristic Messes With Inflation Targeting, Evelin Da Silva, Sergio Da Silva

Sergio Da Silva

The Homo [Not So] Economicus And The Law: A Critique Of Positive Theory Of Rational Choice In The Law [En Español], Daniel A. Monroy

Daniel A Monroy C

From the Behavioral Economics point of view, this paper presents a critic to one dimension of rational choice theory that is widely accepted by Law and Economics scholars. Our hypothesis is that (i) individuals deviate anomalously but predictably of normative assumption of rational choice. We suggests that, (ii) more than –unbounded– rational self interested individuals, in certain contexts, people tend to deviate from this normative behavior and also, tend to judge the behavior of other people, according to the consistency of these behaviors with a hypothetical situation commonly referred to as the "reference transaction".

Desde la perspectiva del Behavioral Economics, …

Preschoolers And The Endowment Effect, Sergio Da Silva, Bruno Moreira, Newton Da Costa Jr

Sergio Da Silva

We show that preschoolers exhibit the endowment effect as evidenced by experiments where children generally chose to keep their own toys rather than trading them for similar ones. Furthermore, we relate the emergence of this effect to children’s innate psychobiological traits—emotional state, gender, handedness, and digit ratio. The trials were conducted with 141 children across 6 kindergartens. We also found support that children, like adults, exhibit a preference for physical possession as opposed to ownership. As with adults, emotions also seem to matter, as children who were described as quiet and calm were more likely to present the endowment effect. …

Risk Seekers May Be Antisocial After All, Sergio Da Silva, Raul Matsushita, Luiza Ugarte, Mateus De Carvalho

Sergio Da Silva

Undergraduates were given a battery of psychological tests to gauge their degree of antisocial personality traits (psychopathy, Machiavellianism and nihilism). The students also responded to questionnaires to assess their attitudes toward risk and intertemporal choice. Biological attributes of the respondents were also collected. We found a correlation between psychopathic, Machiavellian and nihilistic traits in the sample, and also that risk seekers were antisocial. Additionally, we found, on average, that younger subjects presented higher levels of psychopathy; atheists were more Machiavellian; and atheists who were anxious tend to be nihilists. Moreover, boys born from younger mothers were more risk seeking than …

2d:4d Digit Ratio Predicts Delay Of Gratification In Preschoolers, Sergio Da Silva, Bruno Moreira, Newton Da Costa Jr

Sergio Da Silva

We replicate the Stanford marshmallow experiment with a sample of 141 preschoolers and find a correlation between lack of self-control and 2D:4D digit ratio. Children with low 2D:4D digit ratio are less likely to delay gratification. Low 2D:4D digit ratio may indicate high fetal testosterone. If this hypothesis is true, our finding means high fetal testosterone children are less likely to delay gratification.

Behavioral Economics: Origins, Methodology And “Work Tools”, Daniel A. Monroy

Daniel A Monroy C

This paper has two main objectives: (i) The main objective is to propose a theoretical and methodological delimitation of the Behavioral Economics approach. In this point, the paper argues that such delimitation involves a permanent tension with the hypotheses of rational choice theory of human behavior. (ii) The secondary objective of the paper focuses on the methodology submitted, for this, we present a couple of case studies in order to explain and test such methodology. Furthermore, the case studies will allow us to determinate some work tools of the Behavioral Economics approach.

Modelling Biased Judgement With Weighted Updating, Jesse A. Zinn

Jesse A Zinn

The weighted updating model is a generalization of Bayesian updating that allows for biased beliefs by weighting the functions that constitute Bayes’ rule with real exponents. This paper shows that weighting a distribution affects the information entropy of the resulting distribution, suggesting that weighted updating can model biases in which individuals mistake the information content of data. The paper augments the base model in two ways, allowing it to account for additional biases. The first expansion involves discrimination between data. The second allows the weights to vary over time. The paper also presents a set of sufficient conditions for the …

Inequality, Communication And The Avoidance Of Disastrous Climate Change In A Public Goods Game, Alessandro Tavoni, Astrid Dannenberg, Giorgos Kallis, Andreas Loeschel

Alessandro Tavoni

International efforts to provide global public goods often face the challenges of coordinating national contributions and distributing costs equitably in the face of uncertainty, inequality, and free-riding incentives. In an experimental setting, we distribute endowments unequally among a group of people who can reach a fixed target sum through successive money contributions, knowing that if they fail they will lose all their remaining money with 50% probability. In some treatments we give players the option to communicate intended contributions. We find that inequality reduces the prospects of reaching the target, but that communication increases success dramatically. Successful groups tend to …

Teoría Prospectiva, Efecto Marco Y Los Mensajes De Disuasión De Consumo De Tabaco En Colombia, Daniel Monroy

Daniel A Monroy C

The main target of this reflex paper is to explain some ideas about behavioral economics, such as the Prospect Theory and the framing effect, as well as its possible implications for the law, especially in the context of tobacco control law in Colombia and the current package warning labels. The paper concludes that these warnings have the potential to reduce the tobacco consumption. However the effectiveness of these messages could be increased if the information is reframed in an alternative way.

This paper is based in other one called: "ANÁLISIS ECONÓMICO-CONDUCTUAL DE LA REGULACIÓN ANTITABACO EN COLOMBIA: El efecto marco …

Más Vale Malo Conocido Que…: El Efecto Dotación Y Los Pronósticos Teóricos Del Teorema De Coase, Daniel Monroy

Daniel A Monroy C

Some studies of the "endowment effect" in behavioral economics have criticized the theoretical prediction of the Coase Theorem even in its most basic formulation. This document describes the evidence of the existence of this "anomaly" in individual decision-making in various contexts in order to determine the possible general implications of this effect in the economic analysis itself especially as an explanation for the sometimes, insuperable gap between the willingness to accept for giving a right and the correlative willingness to pay to get it, also the paper describes a contradiction with the assumption of reversibility of preferences at any dot …

Regulaciones Que Nos Hacen Más Inteligentes, Daniel Monroy

Daniel A Monroy C

En presente artículo es una síntesis de algunas ideas puntuales relacionadas con las posibles consecuencias y retos que puede tener para el derecho la asunción de algunas ideas propias de la economía conductual, tal como la aceptación relativa a que los individuos muestran en su toma de decisiones, en ocasiones, una fuerza de voluntad limitada.

Incorporating Fairness Motives Into The Impulse Balance Equilibrium And Quantal Response Equilibrium Concepts: An Application To 2x2 Games, Alessandro Tavoni

Alessandro Tavoni

Substantial evidence has accumulated in recent empirical works on the limited ability of the Nash equilibrium to rationalize observed behavior in many classes of games played by experimental subjects. This realization has led to several attempts aimed at finding tractable equilibrium concepts which perform better empirically; one such example is the impulse balance equilibrium (Selten, Chmura, 2008), which introduces a psychological reference point to which players compare the available payoff allocations. This paper is concerned with advancing two new, empirically sound, concepts: equity-driven impulse balance equilibrium (EIBE) and equity-driven quantal response equilibrium (EQRE): both introduce a distributive reference point to …

Behavioral Economic Issues In American & Islamic Marriage & Divorce Law, Ryan M. Riegg

Ryan M. Riegg