Central to many theoretical accounts of the process by which (rational) people tackle dynamic decision problems is the concept of a plan: a set of conditional decisions as to what would be decided under certain conditions (imposed by Nature). The notion of a plan is clearly central to theories...

Learning with bounded memory in stochastic frameworks is incomplete in the sense that the learning dynamics cannot converge to an rational expectations equilibrium (REE). The properties of the dynamics arising from such rules are studied for models with steady states. If in standard linear...

In 2004 the income of female GPs was 70%, and their wages (income per hour) were 91%, of those of male GPs. We compare estimates of gender discrimination from Oaxaca decompositions using models of wages (income/hours), OLS and 2SLS models of income, and propensity score matching. We propose a...

Often neither the exact density nor the exact cumulative distribution function (CDF) of a statistic of interest are available in the statistics and econometrics literature (for example the maximum likelihood estimator of the autocorrelation coefficient in a simple Gaussian AR(1) model with zero...

This paper reports on an experimental test of the Principle of Optimality in dynamic decision problems. This Principle, which states that the decision-maker should always choose the optimal decision at each stage of the decision problem, conditional on behaving optimally thereafter, underlies...