When and how to satisfice: an experimental investigation

This paper is about satisficing behaviour. Rather tautologically, this is when decision-makers are satisfied with achieving some objective, rather than in obtaining the best outcome. The term was coined by Simon (Q J Econ 69:99–118, 1955), and has stimulated many discussions and theories. Prominent amongst these theories are models of incomplete preferences, models of behaviour under ambiguity, theories of rational inattention, and search theories. Most of these, however, seem to lack an answer to at least one of two key questions: when should the decision-maker (DM) satisfice; and how should the DM satisfice. In a sense, search models answer the latter question (in that the theory tells the DM when to stop searching), but not the former; moreover, usually the question as to whether any search at all is justified is left to a footnote. A recent paper by Manski (Theory Decis. doi: 10.1007/s11238-017-9592-1, 2017) fills the gaps in the literature and answers the questions: when and how to satisfice? He achieves this by setting the decision problem in an ambiguous situation (so that probabilities do not exist, and many preference functionals can therefore not be applied) and by using the Minimax Regret criterion as the preference functional. The results are simple and intuitive. This paper reports on an experimental test of his theory. The results show that some of his propositions (those relating to the ‘how’) appear to be empirically valid while others (those relating to the ‘when’) are less so.     

A multiattribute decision time theory

In this study, we analyze choice in the presence of some conflict that affects the decision time (response time), a subject that has been documented in the literature. We axiomatize a multiattribute decision time (MDT) representation, which is a dynamic extension of the classic multiattribute expected utility theory that allows potentially incomplete preferences. Under this framework, one alternative is preferred to another in a certain period if and only if the weighted sum of the attribute-dependent expected utility induced by the former alternative is larger than that induced by the latter for all attribute weights in a closed and convex set. MDT uniquely determines the decision time as the earliest period at which the ranking between alternatives becomes decisive. The comparative statics result indicates that the decision time provides useful information to locate indifference curves in a specific setting. MDT also explains various empirical findings in economics and other relevant fields.     

A note on the Condorcet jury theorem for couples

A jury and two valid options are given. Each agent of the jury picks exactly one of these options. The option with the most votes will be chosen by the jury. In the N-couple model of Althöfer and Thiele (Theory and Decision 81:1–15, 2016), the jury consisted of 2N agents. These agents form N independent couples, with dependencies within the couples. The authors assumed that the agents who form a couple have the same competence level. In this note, we relax this assumption by allowing different competence levels within the couples. We show that the theoretical results of Althöfer and Thiele remain valid under this relaxation.     

On the characterization of weighted simple games

This paper has a twofold scope. The first one is to clarify and put in evidence the isomorphic character of two theories developed in quite different fields: on one side, threshold logic, on the other side, simple games. One of the main purposes in both theories is to determine when a simple game is representable as a weighted game, which allows a very compact and easily comprehensible representation. Deep results were found in threshold logic in the sixties and seventies for this problem. However, game theory has taken the lead and some new results have been obtained for the problem in the past two decades. The second and main goal of this paper is to provide some new results on this problem and propose several open questions and conjectures for future research. The results we obtain depend on two significant parameters of the game: the number of types of equivalent players and the number of types of shift-minimal winning coalitions.     

Asymmetric Choquet random walks and ambiguity aversion or seeking

Asymmetric Choquet random walks are defined, in the form of dynamically consistent random walks allowing for asymmetric conditional capacities. By revisiting Kast and Lapied (Dynamically consistent Choquet random walk and real investments. Document de Travail n. 2010-33, GREQAM, HAL id: halhs-00533826, 2010b) and Kast et al. (Econ Model, 38:495–503, 2014) we show that some findings regarding the effects of ambiguity aversion are preserved in the more general framework, which is of interest in several applications to policy making, risk management, corporate decisions, real option valuation of investment/ disinvestment projects, etc. The effect of ambiguity on the higher moments is investigated, as well, as they have an interpretation in terms of the psychological attitude of a decision-maker towards ambiguity. Finally, some financial applications are provided as an illustration.     

The Moderating Effect of Living with a Child Before Incarceration on Postrelease Outcomes Related to a Prison-Based Parent Management Training Program

ABSTRACT

With the rapid growth in incarceration in the United States over the past few decades came dramatic growth in the number of the incarcerated parents with at least one minor child. Parental incarceration places extra stresses and strains on families and children. Almost all of those incarcerated will eventually be released. However, the majority of those released from prison will be rearrested within a year. Finding interventions that can decrease the likelihood of returning to crime and to incarceration are of utmost importance. Using a social bond theory framework, the authors examine the moderating effect of living with a child before incarceration on program outcomes related to a prison-based parent management training program. A significant effect was found. Implications for these findings are discussed for future research and practice.     

Meaningful learning in weighted voting games: an experiment

In April 2013, all of the major academic publishing houses moved thousands of journal titles to an original hybrid model, under which authors of accepted papers can choose between an expensive open access (OA) track and the traditional track available only to subscribers. This paper argues that authors might now use a publication strategy as a quality signaling device. The imperfect information game between authors and readers presents several types of Perfect Bayesian Equilibria, including a separating equilibrium in which only authors of high-quality papers are driven toward the open access track. The publishing house should choose an open-access publication fee that supports the emergence of the highest return equilibrium. Journal structures will evolve over time according to the journals’ accessibility and quality profiles.     

Resolute majority rules

We investigate resolute voting rules that always rank two alternatives strictly and avoid social indecision. Resolute majority rules differ from the standard majority rule in that whenever both alternatives win the same number of votes, a tie-breaking function is used to determine the outcome. We provide axiomatic characterizations of resolute majority rules or resolute majority rules with a quorum. Resoluteness axiom is used in all these results. The other axioms are weaker than those considered in the characterization of the majority rule by May (1952 Econometrica, 20:680–684). In particular, instead of May’s positive responsiveness, we consider a much weaker monotonicity axiom.     

A simple framework for the axiomatization of exponential and quasi-hyperbolic discounting

The main goal of this paper is to investigate which normative requirements, or axioms, lead to exponential and quasi-hyperbolic forms of discounting. Exponential discounting has a well-established axiomatic foundation originally developed by Koopmans (Econometrica 28(2):287–309, 1960, 1972) and Koopmans et al. (Econometrica 32(1/2):82–100, 1964) with subsequent contributions by several other authors, including Bleichrodt et al. (J Math Psychol 52(6):341–347, 2008). The papers by Hayashi (J Econ Theory 112(2):343–352, 2003) and Olea and Strzalecki (Q J Econ 129(3):1449–1499, 2014) axiomatize quasi-hyperbolic discounting. The main contribution of this paper is to provide an alternative foundation for exponential and quasi-hyperbolic discounting, with simple, transparent axioms and relatively straightforward proofs. Using techniques by Fishburn (The foundations of expected utility. Reidel Publishing Co, Dordrecht, 1982) and Harvey (Manag Sci 32(9):1123–1139, 1986), we show that Anscombe and Aumann’s (Ann Math Stat 34(1):199–205, 1963) version of Subjective Expected Utility theory can be readily adapted to axiomatize the aforementioned types of discounting, in both finite and infinite horizon settings.     

Piecewise linear rank-dependent utility

Choice under risk is modelled using a piecewise linear version of rank-dependent utility. This model can be considered a continuous version of NEO-expected utility (Chateauneuf et al., J Econ Theory 137:538–567, 2007). In a framework of objective probabilities, a preference foundation is given, without requiring a rich structure on the outcome set. The key axiom is called complementary additivity.