The present paper outlines a theoretical model of agent-based learning. An agent ‘anchors’ his subjective expectations (or forecasts) to another agent’s subjective expectations. The former believes the latter has a better information set and, therefore, able to make better subjective...

A unified approach to the problems of bargaining with a reference point and of bargaining with claims is addressed. Then, two solutions are reexamined from this perspective: the lexicographic egalitarian and the lexicographic claim-egalitarian. New characterization results are also provided.

We consider second-price and first-price auctions in the symmetric independent private values framework. We modify the standard model by the assumption that the bidders have reference-based utility, where the reserve price (minimum bid) plays the role of the reference point. In contrast to the...

Based on measurements among 332 owner-managers, we investigate how the global shape of the utility function (i.e., S-shaped versus concave or convex over the total range of outcomes) relates to choice behavior. We find that the global shape of the utility function differs across decision makers...