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Title:Prior-free optimality and satisficing: a common framework and its experimental implementation PDF Logo
Authors:Güth, Werner
Issue Date:2008
Series/Report no.:Jena economic research papers 2008,055
Abstract:Similar to welfare economics where with(out) interpersonal comparisons one defines unique (set-valued) welfare (Pareto) optima, we present a framework for one-person decision making where with(out) a prior probability distribution individual optimality prescribes usually a unique (set of) choice(s). Satisfiable aspirations in the sense that there exists some choice guaranteeing them define a much larger choice set whose intersection with the set of prior-free optimal choices is never empty. We also review experimental procedures and results which incentivize aspiration formation and reject even prior-free optimality experimentally.
Subjects:Satisficing
bounded rationality
optimality
JEL:B4
D81
D10
Document Type:Working Paper
Appears in Collections:Jena Economic Research Papers, MPI für Ökonomik

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