Making predictions based on data: Holistic and atomistic procedures

Jacob Glazer and Ariel Rubinstein

Journal of Economic Theory, 2024, vol. 216, issue C

Abstract: Subjects were asked to predict the choice made by a hypothetical individual, based on a small sample of his past choices in identical situations. Each of the alternatives facing the individual has a number of components. When the data is presented explicitly as a distribution of past choices, most subjects use the holistic procedure according to which the prediction is the most common choice made in the past. Nevertheless, a significant minority of subjects use atomistic procedures, which relate to the various components individually. When the distribution is not explicitly presented but can be derived from the data, subjects apply both atomistic procedures and holistic rules of thumb.

Keywords: Experimental economics; Non-Bayesian beliefs; Data-based predictions (search for similar items in EconPapers)
JEL-codes: D01 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:216:y:2024:i:c:s0022053123001874

DOI: 10.1016/j.jet.2023.105791

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