Dynamic decision making: what do people do?

John Hey and Luca Panaccione

Chapter 10 in Experiments in Economics:Decision Making and Markets, 2018, pp 235-273 from World Scientific Publishing Co. Pte. Ltd.

Abstract: Potentially dynamically-inconsistent individuals create particular problems for economics, as their behaviour depends upon whether and how they attempt to resolve their potential inconsistency. This paper reports on the results of a new experiment designed to help us distinguish between the different types that may exist. We classify people into four types: myopic, naïve, resolute and sophisticated. We implement a new and simple experimental design in which subjects are asked to take two sequential decisions (interspersed by a random move by Nature) concerning the allocation of a given sum of money. The resulting data enables us to classify the subjects. We find that the majority are resolute, a significant few are sophisticated, rather few are naïve and similarly few are myopic.

Keywords: Experimental Economics; Risk; Ambiguity; Markets; Auctions; Bargaining; Econometrics; Methodology (search for similar items in EconPapers)
JEL-codes: C90 (search for similar items in EconPapers)
Date: 2018
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.worldscientific.com/doi/pdf/10.1142/9789813235816_0010 (application/pdf)
https://www.worldscientific.com/doi/abs/10.1142/9789813235816_0010 (text/html)
Ebook Access is available upon purchase.

Related works:
Journal Article: Dynamic decision making: what do people do? (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:wschap:9789813235816_0010

Ordering information: This item can be ordered from

Access Statistics for this chapter

More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().