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Heukelom, Floris - Tinbergen Instituut - 2007

This paper provides an overview of the work of Herbert Simon and his ideas about rational decision making. By his own …’s research is how human beings organize themselves in different structures of distributed decision making in order to achieve a … view on rational decision making in economics and other social sciences. …

Persistent link: https://www.econbiz.de/10011256722

Kahneman and Tversky and the Origin of Behavioral Economics

Heukelom, Floris - Tinbergen Instituut - 2007

formulation of the St. Petersburg paradox. Bernoulli’s celebrated solution to use utility instead of money marks the beginning of … expected utility theory (EUT). Bernoulli’s work is taken up by psychophysics which in turn plays an important role in the … utility in monetary terms. Relying on this utility definition and on von Neumann and Morgenstern’s axiomatic constraints of …

Persistent link: https://www.econbiz.de/10011256192

Valuation of Travel Time and TravelIer Information

Rietveld, Piet - Tinbergen Instituut - 2003

The value of travel time plays an important role in cost benefit analysis of infrastructureprojects. However, the issue of uncertainty on travel times and the implications this has forestimations of travel time values has received much less attention in the literature. In thispaper we compare...

Persistent link: https://www.econbiz.de/10011257109

Expected Utility and Catastrophic Risk

Ikefuji, Masako; Laeven, Roger; Magnus, Jan; Muris, Chris - Tinbergen Instituut - 2014

An expected utility based cost-benefit analysis is in general fragile to its distributional assumptions. We derive … necessary and sufficient conditions on the utility function of the expected utility model to avoid this. The conditions ensure … that expected (marginal) utility remains finite also under heavy-tailed distributional assumptions. Our results are context …

Persistent link: https://www.econbiz.de/10011261938

Adding Risks: Some General Results about Time Diversification

Lam, Kin; Zou, Liang - Tinbergen Instituut - 2000

.Specifically, any investor's maximal expected utility directlyincreases with n, as well as the investor's willingness toallocate more …

Persistent link: https://www.econbiz.de/10011255554

Risk Aversion and the Subjective Time Discount Rate: A Joint Approach

Praag, Bernard M.S. van; Booij, Adam S. - Tinbergen Instituut - 2003

This discussion paper led to a publication in the <A HREF="http://www.sciencedirect.com/science/article/pii/S0167268109000109">'Journal of Economic Behavior & Organization'</A>, 2009, 70(1-2), 374-388.<P> In this paper we analyze a large sample of individual responses to six lottery questions. Wederive a simultaneous estimate of risk aversion γ and the time preference discount...</p></a>

Persistent link: https://www.econbiz.de/10011255702

Loss Modification Incentives for Insurers under Expected Utility and Loss Aversion

Soetevent, Adriaan R.; Zhou, Liting - Tinbergen Instituut - 2014

expected profit maximizing loss probability within an expected utility framework. We then use Köszegi and Rabin's (2006, 2007 …

Persistent link: https://www.econbiz.de/10011256470

What is the Value of Entrepreneurship? A Review of Recent Research

Praag, C. Mirjam van; Versloot, Peter H. - Tinbergen Instituut - 2007

group’? A fourth type of contribution studied is the role of entrepreneurship in increasing individuals’ utility levels …

Persistent link: https://www.econbiz.de/10011257287

Expectations in Experiments

Wagener, Florian - Tinbergen Instituut - 2013

The rational expectations hypothesis is one of the cornerstones of current economic theorising. This review discusses a number of experiments that focus on expectation formation by human subjects and analyses the implications for the rational expectations hypothesis. The experiments show that...

Persistent link: https://www.econbiz.de/10011257595

Continuous Beliefs Dynamics

Diks, Cees; Weide, Roy van der - Tinbergen Instituut - 2003

We propose a general framework for studying the evolution ofheterogeneous beliefs in a dynamic feedback setting. Beliefsdistributions are defined on a continuous space representingthe possible strategies agents can choose from. Agents base theirchoices on past performances. As new information...

Persistent link: https://www.econbiz.de/10011249542