In this paper, the author separates the economic from the psychological aspects of labor market behavior and argues that the psychological ones deserve careful study.

Stimulated by Frank Knight's work, "Risk, Uncertainty and Profit," I present a theory of innovation based on what I term Knightian decision theory. This theory includes a concept of uncertainty aversion, a behavioral property that makes people reluctant to undertake new unevaluatable risks. This...

A theory of choice under uncertainty is proposed which removes the completeness assumption from the Anscombe-Aumann formulation of Savage's theory and introduces an inertia assumption. The inertia assumption is that there is such a thing as the status quo and an alternative is accepted only if...

This paper contains a review of work on wage rigidity. The work includes field studies, and economic experiments, and psychological surveys. Economists have done the field studies and experiments, and management scientists and experimental psychologists have done the surveys.