Economics at your fingertips  

On Second Thoughts, Selective Memory, and Resulting Behavioral Biases

Philippe Jehiel () and Jakub Steiner ()

No 12546, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: A proposed model of information processing generates a prediction about the constrained-optimal stochastic choice that is robust to details of the feasible information structures. A decision-maker processes payoff-relevant information until she reaches her cognitive constraint, at which point she either terminates the decision-making and chooses an action, or restarts the process. By conditioning the probability of termination on the information collected, she controls the correlation between the payoff state and her terminal action. The constrained-optimal choice rule exhibits (i) confirmation bias, (ii) speed-accuracy complementarity, (iii) overweighting of rare events, and (iv) salience effect.

New Economics Papers: this item is included in nep-mic, nep-neu and nep-upt
Date: 2017-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link) (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at

Related works:
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:

Ordering information: This working paper can be ordered from ... rs/dp.php?dpno=12546

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().

Page updated 2019-12-15
Handle: RePEc:cpr:ceprdp:12546