Game and decision theory start from rather strong premises. Preferences, represented by utilities, beliefs represented by probabilities, common knowledge and symmetric rationality as background assumptions are treated as “given.” A richer language enabling us to capture the process leading...

During the last three decades the ascent of behavioral economics clearly helped to bring down artificial disciplinary boundaries between psychology and economics. Noting that behavioral economics seems still under the spell of the rational choice tradition - and, indirectly, of behaviorism - we...

Game and decision theory start from rather strong premises. Preferences, represented by utilities, beliefs represented by probabilities, common knowledge and symmetric rationality as background assumptions are treated as 'given.' A richer language enabling us to capture the process leading to...

Game and decision theory start from rather strong premises. Preferences, represented by utilities, beliefs represented by probabilities, common knowledge and symmetric rationality as background assumptions are treated as “given.” A richer language enabling us to capture the process leading...

On a heterogeneous experimental oligopoly market, sellers choose a price, specify a set-valued prior-free conjecture about the others' behavior, and form their own profit-aspiration for each element of their conjecture. We formally define the concepts of satisficing and prior-free optimality and...

The satisficing approach is generalized and applied to finite n-person games. Based on direct elicitation of aspirations, we formally define the concept of satisficing, which does not exclude (prior-free) optimality but includes it as a border case. We also review some experiments on strategic...

Restricting attention to economic environments, we study implementation under perturbed better-response dynamics (BRD). A social choice function (SCF) is implementable in stochastically stable strategies of perturbed BRD whenever the only outcome supported by the stochastically stable strategies...

We study the classic implementation problem under the behavioral assumption that agents myopically adjust their actions in the direction of better-responses within a given institution. We offer results both under complete and incomplete information. First, we show that a necessary condition for...

In a stochastic duopoly market, sellers must form state-specific aspirations expressing how much they want to earn given their expectations about the other's behavior. We define individually and mutually satisficing sales behavior for given individual beliefs and aspiration profiles. In a first...

This paper is concerned with the realism of mechanisms that implement social choice functions in the traditional sense. Will agents actually play the equilibrium assumed by the analysis? As an example, we study the convergence and stability properties of Sj\"ostr\"om's (1994) mechanism, on the...