Richard H. Thaler
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Economics & Finance 2011
Economics & Finance 2011 press.princeton.edu Contents General Interest 1 Economic Theory & Research 15 Game Theory 18 Finance 19 Econometrics, Mathematical & Applied Economics 24 Innovation & Entrepreneurship 26 Political Economy, Trade & Development 27 Public Policy 30 Economic History & History of Economics 31 Economic Sociology & Related Interest 36 Economics of Education 42 Classic Textbooks 43 Index/Order Form 44 TEXT Professors who wish to consider a book from this catalog for course use may request an examination copy. For more information please visit: press.princeton.edu/class.html New Winner of the 2010 Business Book of the Year Award, Financial Times/Goldman Sachs Fault Lines How Hidden Fractures Still Threaten the World Economy Raghuram G. Rajan “What caused the crisis? . There is an embarrassment of causes— especially embarrassing when you recall how few people saw where they might lead. Raghuram Rajan . was one of the few to sound an alarm before 2007. That gives his novel and sometimes surprising thesis added authority. He argues in his excellent new book that the roots of the calamity go wider and deeper still.” —Clive Crook, Financial Times Raghuram G. Rajan is the Eric J. Gleacher Distinguished Service Profes- “Excellent . deserve[s] to sor of Finance at the University of Chicago Booth School of Business and be widely read.” former chief economist at the International Monetary Fund. —Economist 2010. 272 pages. Cl: 978-0-691-14683-6 $26.95 | £18.95 Not for sale in India ForthcominG Blind Spots Why We Fail to Do What’s Right and What to Do about It Max H. Bazerman & Ann E. -
When Does Behavioural Economics Really Matter?
When does behavioural economics really matter? Ian McAuley, University of Canberra and Centre for Policy Development (www.cpd.org.au) Paper to accompany presentation to Behavioural Economics stream at Australian Economic Forum, August 2010. Summary Behavioural economics integrates the formal study of psychology, including social psychology, into economics. Its empirical base helps policy makers in understanding how economic actors behave in response to incentives in market transactions and in response to policy interventions. This paper commences with a short description of how behavioural economics fits into the general discipline of economics. The next section outlines the development of behavioural economics, including its development from considerations of individual psychology into the fields of neurology, social psychology and anthropology. It covers developments in general terms; there are excellent and by now well-known detailed descriptions of the specific findings of behavioural economics. The final section examines seven contemporary public policy issues with suggestions on how behavioural economics may help develop sound policy. In some cases Australian policy advisers are already using the findings of behavioural economics to advantage. It matters most of the time In public policy there is nothing novel about behavioural economics, but for a long time it has tended to be ignored in formal texts. Like Molière’s Monsieur Jourdain who was surprised to find he had been speaking prose all his life, economists have long been guided by implicit knowledge of behavioural economics, particularly in macroeconomics. Keynes, for example, understood perfectly the “money illusion” – people’s tendency to think of money in nominal rather than real terms – in his solution to unemployment. -
Property in Housing Lee Anne Fennell
University of Chicago Law School Chicago Unbound Kreisman Working Paper Series in Housing Law and Working Papers Policy 2013 Property in Housing Lee Anne Fennell Follow this and additional works at: https://chicagounbound.uchicago.edu/ housing_law_and_policy Part of the Law Commons Chicago Unbound includes both works in progress and final versions of articles. Please be aware that a more recent version of this article may be available on Chicago Unbound, SSRN or elsewhere. Recommended Citation Lee Anne Fennell, "Property in Housing" (Kreisman Working Papers Series in Housing Law and Policy No. 13, 2013). This Working Paper is brought to you for free and open access by the Working Papers at Chicago Unbound. It has been accepted for inclusion in Kreisman Working Paper Series in Housing Law and Policy by an authorized administrator of Chicago Unbound. For more information, please contact [email protected]. CHICAGO PUBLIC LAW AND LEGAL THEORY WORKING PAPER NO. 426 KREISMAN WORKING PAPER ON HOUSING LAW AND POLICY NO. 13 PROPERTY IN HOUSING Lee Anne Fennell THE LAW SCHOOL THE UNIVERSITY OF CHICAGO April 2013 This paper can be downloaded without charge at the Public Law and Legal Theory Working Paper Series: http://www.law.uchicago.edu/academics/publiclaw/index.html and The Social Science Research Network Electronic Paper Collection. Academia Sinica Law Journal No. 12 March 2013 Property in Housing Lee Anne Fennell Suggested citation format: Footnote: Lee Anne Fennell, Property in Housing , 12 ACADEMIA SINICA L.J. 31, 31-78 (2013). Reference : Fennell, Lee Anne. 2013. Property in Housing. Academia Sinica Law Journal 12:31-78. -
Mindful Economics: the Production, Consumption, and Value of Beliefs
Journal of Economic Perspectives—Volume 30, Number 3—Summer 2016—Pages 141–164 Mindful Economics: The Production, Consumption, and Value of Beliefs Roland Bénabou and Jean Tirole n the economic models of old, agents had backward-looking expectations, arising from simple extrapolation or error-correction rules. Then came the I rational-expectations revolution in macroeconomics, and in microeconomics the spread and increasing refinements of modern game theory. Agents were now highly sophisticated information processors, who could not be systematically fooled. This approach reigned for several decades until the pendulum swung back with the rise of behavioral economics and its emphasis on “heuristics and biases” (as in Tversky and Kahneman 1974). Overconfidence, confirmation bias, distorted prob- ability weights, and a host of other “wired-in” cognitive mistakes are now common assumptions in many areas of economics. Over the last decade or so, the pendulum has started to swing again toward some form of adaptiveness, or at least implicit purposefulness, in human cognition. In this paper, we provide a perspective into the main ideas and findings emerging from the growing literature on motivated beliefs and reasoning. This perspec- tive emphasizes that beliefs often fulfill important psychological and functional needs of the individual. Economically relevant examples include confidence in ones’ abilities, moral self-esteem, hope and anxiety reduction, social identity, polit- ical ideology and religious faith. People thus hold certain beliefs in part because ■ Roland Bénabou is Theodore A. Wells ‘29 Professor of Economics and Public Affairs, Princ- eton University, Princeton, New Jersey and a Senior Fellow, Canadian Institute for Advanced Research, Toronto, Canada. -
Price Competition with Satisficing Consumers
View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Aberdeen University Research Archive Price Competition with Satisficing Consumers∗ Mauro Papiy Abstract The ‘satisficing’ heuristic by Simon (1955) has recently attracted attention both theoretically and experimentally. In this paper I study a price-competition model in which the consumer is satisficing and firms can influence his aspiration price via marketing. Unlike existing models, whether a price comparison is made depends on both pricing and marketing strategies. I fully characterize the unique symmetric equilibrium by investigating the implications of satisficing on various aspects of market competition. The proposed model can help explain well-documented economic phenomena, such as the positive correla- tion between marketing and prices observed in some markets. JEL codes: C79, D03, D43. Keywords: Aspiration Price, Bounded Rationality, Price Competition, Satisficing, Search. ∗This version: August 2017. I would like to thank the Editor of this journal, two anonymous referees, Ed Hopkins, Hans Hvide, Kohei Kawamura, Ran Spiegler, the semi- nar audience at universities of Aberdeen, East Anglia, and Trento, and the participants to the 2015 OLIGO workshop (Madrid) and the 2015 Econometric Society World Congress (Montreal) for their comments. Financial support from the Aberdeen Principal's Excel- lence Fund and the Scottish Institute for Research in Economics is gratefully acknowledged. Any error is my own responsibility. yBusiness School, University of Aberdeen - Edward Wright Building, Dunbar Street, AB24 3QY, Old Aberdeen, Scotland, UK. E-mail address: [email protected]. 1 1 Introduction According to Herbert Simon (1955), in most global models of rational choice, all alternatives are eval- uated before a choice is made. -
The Business Cycle and the Stock Market
-1- THE BUSINESS CYCLE AND THE STOCK MARKET by Andrei S leifer A.B., Harv d University (1982) SUBMITTED TO THE DEPARTMENT OF ECONOMICS IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY at the MASSACHUSETTS INSTITUTE OF TECHNOLOGY May 1986 Andrei Shleifer 1986 The author hereby grants to M.I.T. permission to reproduce and to distribute copies of this thesis document in whole or in part. Signature of author__ Department of Economics May 12, 1986 Certified by Peter A. Diamond / Thesis Supervisor Certified by Franklin M. Fisher / Thesis Supervisor Accepted by Richard S. Eckaus Chairman, Departmental Graduate Committee ARCHIVES MASSACHUSETT SIN!TiTUTE OF TCHNN N1'' JUN 1 3 198E LIBRA";. - - 2 ABSTRACT The three essays of this thesis concern the role of expectations in determining the allocation of resources, particularly in the macroecono- mic context. Specifically, all three papers are motivated by the propo- sition that private agents' beliefs are aggregated into stock market prices, which can therefore influence the allocation of investment. The first essay does not deal with financial markets explicitly, although it explores the role of animal spirits in determining invest- ment. The essay describes an artificial economy, in which firms in dif- ferent sectors make inventions at different times, but innovate simultaneously to take advantage of high aggregate demand. In turn, high demand results from simultaneous innovation in many sectors. The economy exhibits multiple cyclical equilibria, with entrepreneurs' expectations determining which equilibrium obtains. These equilibria are Pareto ranked, and the most profitable equilibrium need not be the most effi- cient. -
ECON 1820: Behavioral Economics Spring 2015 Brown University Course Description Within Economics, the Standard Model of Be
ECON 1820: Behavioral Economics Spring 2015 Brown University Course Description Within economics, the standard model of behavior is that of a perfectly rational, self interested utility maximizer with unlimited cognitive resources. In many cases, this provides a good approximation to the types of behavior that economists are interested in. However, over the past 30 years, experimental and behavioral economists have documented ways in which the standard model is not just wrong, but is wrong in ways that are important for economic outcomes. Understanding these behaviors, and their implications, is one of the most exciting areas of current economic inquiry. The aim of this course is to provide a grounding in the main areas of study within behavioral economics, including temptation and self control, fairness and reciprocity, reference dependence, bounded rationality and choice under risk and uncertainty. For each area we will study three things: 1. The evidence that indicates that the standard economic model is missing some important behavior 2. The models that have been developed to capture these behaviors 3. Applications of these models to (for example) finance, labor and development economics As well as the standard lectures, homework assignments, exams and so on, you will be asked to participate in economic experiments, the data from which will be used to illustrate some of the principals in the course. There will also be a certain small degree of classroom ‘flipping’, with a portion of many lectures given over to group problem solving. Finally, an integral part of the course will be a research proposal that you must complete by the end of the course, outlining a novel piece of research that you would be interested in doing. -
Featured Topic Social & Behavioral Science Interventions at the Federal Level in This Issue Nudging People to Get Flu Vaccinations
a publication of the behavioral science & policy association volume 2 issue 2 2016 featured topic social & behavioral science interventions at the federal level in this issue Nudging people to get flu vaccinations behavioralpolicy.org founding co-editors disciplinary editors Craig R. Fox (UCLA) Behavioral Economics Sim B Sitkin (Duke University) Senior Disciplinary Editor Dean S. Karlan (Yale University) bspa executive director Associate Disciplinary Editors Oren Bar-Gill (Harvard University) Colin F. Camerer (California Institute ofTechnology) Kate B.B. Wessels M. Keith Chen (UCLA) advisory board Julian Jamison (World Bank) Paul Brest (Stanford University) Russell B. Korobkin (UCLA) David Brooks (New York Times) Devin G. Pope (University of Chicago) John Seely Brown (Deloitte) Jonathan Zinman (Dartmouth College) Robert B. Cialdini (Arizona State University) Adam M. Grant (University of Pennsylvania) Cognitive & Brain Science Daniel Kahneman (Princeton University) Senior Disciplinary Editor Henry L. Roediger III (Washington University) James G. March (Stanford University) Associate Disciplinary Editors Yadin Dudai (Weizmann Institute & NYU) Jeffrey Pfeffer (Stanford University) Roberta L. Klatzky (Carnegie Mellon University) Denise M. Rousseau (Carnegie Mellon University) Hal Pashler (UC San Diego) Paul Slovic (University of Oregon) Steven E. Petersen (Washington University) Cass R. Sunstein (Harvard University) Jeremy M. Wolfe (Harvard University) Richard H. Thaler (University of Chicago) Decision, Marketing, & Management Sciences executive committee Senior Disciplinary Editor Eric J. Johnson (Columbia University) Associate Disciplinary Editors Linda C. Babcock (Carnegie Mellon University) Morela Hernandez (University of Virginia) Max H. Bazerman (Harvard University) Katherine L. Milkman (University of Pennsylvania) Baruch Fischhoff (Carnegie Mellon University) Daniel Oppenheimer (UCLA) John G. Lynch (University of Colorado) Todd Rogers (Harvard University) John W. -
Behavioral Economics and Marketing in Aid of Decision Making Among the Poor
Behavioral Economics and Marketing in Aid of Decision Making Among the Poor The Harvard community has made this article openly available. Please share how this access benefits you. Your story matters Citation Bertrand, Marianne, Sendhil Mullainathan, and Eldar Shafir. 2006. Behavioral economics and marketing in aid of decision making among the poor. Journal of Public Policy and Marketing 25(1): 8-23. Published Version http://dx.doi.org/10.1509/jppm.25.1.8 Citable link http://nrs.harvard.edu/urn-3:HUL.InstRepos:2962609 Terms of Use This article was downloaded from Harvard University’s DASH repository, and is made available under the terms and conditions applicable to Other Posted Material, as set forth at http:// nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-of- use#LAA Behavioral Economics and Marketing in Aid of Decision Making Among the Poor Marianne Bertrand, Sendhil Mullainathan, and Eldar Shafir This article considers several aspects of the economic decision making of the poor from the perspective of behavioral economics, and it focuses on potential contributions from marketing. Among other things, the authors consider some relevant facets of the social and institutional environments in which the poor interact, and they review some behavioral patterns that are likely to arise in these contexts. A behaviorally more informed perspective can help make sense of what might otherwise be considered “puzzles” in the economic comportment of the poor. A behavioral analysis suggests that substantial welfare changes could result from relatively minor policy interventions, and insightful marketing may provide much needed help in the design of such interventions. -
Esther Duflo Wins Clark Medal
Esther Duflo wins Clark medal http://web.mit.edu/newsoffice/2010/duflo-clark-0423.html?tmpl=compon... MIT’s influential poverty researcher heralded as best economist under age 40. Peter Dizikes, MIT News Office April 23, 2010 MIT economist Esther Duflo PhD ‘99, whose influential research has prompted new ways of fighting poverty around the globe, was named winner today of the John Bates Clark medal. Duflo is the second woman to receive the award, which ranks below only the Nobel Prize in prestige within the economics profession and is considered a reliable indicator of future Nobel consideration (about 40 percent of past recipients have won a Nobel). Duflo, a 37-year-old native of France, is the Abdul Esther Duflo, the Abdul Latif Jameel Professor of Poverty Alleviation Latif Jameel Professor of Poverty Alleviation and and Development Economics at MIT, was named the winner of the Development Economics at MIT and a director of 2010 John Bates Clark medal. MIT’s Abdul Latif Jameel Poverty Action Lab Photo - Photo: L. Barry Hetherington (J-PAL). Her work uses randomized field experiments to identify highly specific programs that can alleviate poverty, ranging from low-cost medical treatments to innovative education programs. Duflo, who officially found out about the medal via a phone call earlier today, says she regards the medal as “one for the team,” meaning the many researchers who have contributed to the renewal of development economics. “This is a great honor,” Duflo told MIT News. “Not only for me, but my colleagues and MIT. Development economics has changed radically over the last 10 years, and this is recognition of the work many people are doing.” The American Economic Association, which gives the Clark medal to the top economist under age 40, said Duflo had distinguished herself through “definitive contributions” in the field of development economics. -
Memory, Attention, and Choice
Memory, Attention, and Choice Pedro Bordalo, Nicola Gennaioli, Andrei Shleifer1 Revised May 7, 2019 (original version 2015) Abstract. Building on the textbook description of associative memory (Kahana 2012), we present a model of choice in which options cue recall of similar past experiences. Recall shapes valuation and choice in two ways. First, recalled experiences form a norm, which serves as an initial anchor for valuation. Second, salient quality and price surprises relative to the norm lead to large adjustments in valuation. The model provides a unified account of many well documented choice puzzles including experience effects, projection and attribution biases, background contrast effects, and context- dependent willingness to pay. The results suggest that well-established psychological processes – memory-based norms and attention to surprising features – are key to understanding decision-making. 1 The authors are from University of Oxford, Universita Bocconi, and Harvard University, respectively. We are grateful to Dan Benjamin, Paulo Costa, Ben Enke, Matt Gentzkow, Sam Gershman, Thomas Graeber, Michael Kahana, Spencer Kwon, George Loewenstein, Sendhil Mullainathan, Josh Schwartzstein, Jesse Shapiro, Jann Spiess, Linh To, and Pierre- Luc Vautrey for valuable comments. Shleifer thanks the Sloan Foundation and the Pershing Square Venture Fund for Research on the Foundations of Human Behavior for financial support. 1 1. Introduction Memory appears to play a central role in even the simplest choices. Consider a thirsty traveler thinking of whether to look for a shop to buy a bottle of water at the airport. He automatically retrieves from memory similar past experiences, including the pleasure of quenching his thirst and the prices he paid before, and decides based on these recollections. -
Who Are the Behavioral Economists and What Do They Say?
A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Heukelom, Floris Working Paper Who are the Behavioral Economists and what do they say? Tinbergen Institute Discussion Paper, No. 07-020/1 Provided in Cooperation with: Tinbergen Institute, Amsterdam and Rotterdam Suggested Citation: Heukelom, Floris (2007) : Who are the Behavioral Economists and what do they say?, Tinbergen Institute Discussion Paper, No. 07-020/1, Tinbergen Institute, Amsterdam and Rotterdam This Version is available at: http://hdl.handle.net/10419/86489 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu TI 2007-020/1 Tinbergen Institute Discussion Paper Who are the Behavioral Economists and what do they say? Floris Heukelom University of Amsterdam, and Tinbergen Institute.