Satisficing in Portfolio Selection - Theoretical Aspects and Experimental Tests
Werner Güth ()
Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group
The satisficing approach with its three constituent processes, aspiration formation, satisficing, and aspiration adjustment, is formally elaborated for a specific class of portfolio selection tasks. It is partly poorly confirmed by experimental data, indicating that bounded rationality requires teaching or, respectively, consulting, and learning. It is also discussed and tested experimentally whether satisficing is task transcending (are there individual constants in satisficing behavior for related tasks?) and absorbable (do we stick to satisficing behavior when becoming aware of it?).
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp and nep-fin
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