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on Neuroeconomics |
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Issue of 2016‒02‒04
five papers chosen by |
| By: | Florian Gauer (Bielefeld University); Christoph Kuzmics (University of Graz) |
| Abstract: | Two individuals are involved in a conflict situation in which preferences are ex ante uncertain. While they eventually learn their own preferences, they have to pay a small cost if they want to learn their opponent’s preferences. We show that, for sufficiently small positive costs of information acquisition, in any Bayesian Nash equilibrium of the resulting game of incomplete information the probability of getting informed about the opponent’s preferences is bounded away from zero and one. |
| Keywords: | Incomplete Information; Information Acquisition; Theory of Mind; Conflict; Imperfect Empathy |
| JEL: | C72 C73 D03 D74 D82 D83 |
| Date: | 2016–01 |
| URL: | http://d.repec.org/n?u=RePEc:grz:wpaper:2016-02&r=neu |
| By: | Anika K. Josef; David Richter; Gregory R. Samanez-Larkin; Gert G. Wagner; Ralph Hertwig; Rui Mata |
| Abstract: | Can risk-taking propensity be thought of as a trait that captures individual differences across domains, measures, and time? Studying stability in risk-taking propensities across the lifespan can help to answer such questions by uncovering parallel, or divergent, trajectories across domains and measures. We contribute to this effort by using data from respondents aged 18 to 85 in the German Socio-Economic Panel Study (SOEP) and by examining (1) differential stability, (2) mean-level differences, and (3) individual-level changes in self-reported general (N = 44,076) and domain-specific (N =11,903) risk-taking propensities across adulthood. In addition, we investigate (4) the correspondence between cross-sectional trajectories of self-report and behavioral measures of social (trust game; N = 646) and nonsocial (monetary gamble; N = 433) risk taking. The results suggest that risk-taking propensity can be understood as a trait with moderate stability. Results show reliable mean-level differences across the lifespan, with risk-taking propensities typically decreasing with age, although significant variation emerges across domains and individuals. Interestingly, the mean-level trajectory for behavioral measures of social and nonsocial risk taking was similar to those obtained from self-reported risk, despite small correlations between task behavior and self-reports. Individual-level analyses suggest a link between changes in risk-taking propensities both across domains and in relation to changes in some of the Big Five personality traits. Overall, these results raise important questions concerning the role of common processes or events that shape the lifespan development of risk-taking across domains as well as other major personality facets. |
| Keywords: | Risk taking, individual differences, lifespan development, domain specificity, differential stability |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp816&r=neu |
| By: | Shachar Kariv (University of California-Berkeley); Dan Silverman (Arizona State University) |
| Abstract: | After middle age, further aging is associated with lower levels of many cognitive abilities, some of which could influence import economic decisions. Our prior research (Choi et al., 2014) shows a substantial negative relationship between age and the consistency of choices with economic rationality (decisionmaking quality). This paper investigates the sources of that negative correlation using panel data on more than 4,000 members of a panel study in the Netherlands. The analysis finds no evidence that the correlation between age and rationality is, in fact, a just a cohort, not an age effect. Similarly, there is little evidence that the correlation is due to other forms of cognitive or health declines. Rather, the findings indicate that age has an independent and negative effect on economic rationality. |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp335&r=neu |
| By: | Brun Irina (National Research University Higher School of Economics); Ivanova Alina (National Research University Higher School of Economics); Kardanova Elena (National Research University Higher School of Economics); Orel Ekaterina (National Research University Higher School of Economics) |
| Abstract: | It is well known that performance, both cognitive and noncognitive, in primary school is very important for children’s future outcomes. In this study we attempt to classify patterns of cognitive, social, emotional and personal development based on data from first-graders beginning their schooling. We use complex iPIPS (international Performance Indicators in Primary Schools) data – a large-scale assessment of first-year pupils, which includes math and reading tasks along with noncognitive assessment – gathered from 1202 children from the Republic of Tatarstan. We describe 5 clusters of first-year pupils and give background information about family and preschool experience which may influence performance in each cluster. |
| Keywords: | iPIPS; noncognitive development; primary school; first-graders; large-scale assessment, cognitive development |
| JEL: | Z |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:57psy2016&r=neu |
| By: | An, Li (Tsinghua University); Wang, Huijun (University of Delaware); Wang, Jian (Federal Reserve Bank of Dallas); Yu, Jianfeng (Federal Reserve Bank of Dallas) |
| Abstract: | Previous empirical studies find that lottery-like stocks significantly underperform their nonlottery-like counterparts. Using five different measures of the lottery features in the literature, we document that the anomalies associated with these measures are statedependent: the evidence supporting these anomalies is strong and robust among stocks where investors have lost money, while among stocks where investors have gained profits, the evidence is either weak or even reversed. Several potential explanations for such empirical findings are examined and we document support for the explanation based on reference-dependent preferences. Our results provide a united framework to understand the lottery-related anomalies in the literature. |
| JEL: | G02 G12 G14 |
| Date: | 2015–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:feddgw:259&r=neu |