Estimating Bayesian Decision Problems with Heterogeneous Priors*

Stephen Hansen and Michael McMahon

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: In many areas of economics there is a growing interest in how expertise and preferences drive individual and group decision making under uncertainty. Increasingly, we wish to estimate such models to quantify which of these drive decision making. In this paper we propose a new channel through which we can empirically identify expertise and preference parameters by using variation in decisions over heterogeneous priors. Relative to existing estimation approaches, our Prior Based Identication” extends the possible environments which can be estimated, and also substantially improves the accuracy and precision of estimates in those environments which can be estimated using existing methods.

Keywords: Bayesian decision making; expertise; preferences; estimation (search for similar items in EconPapers)
JEL-codes: C13 D72 D81 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2013-04
New Economics Papers: this item is included in nep-cdm, nep-dcm and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://cama.crawford.anu.edu.au/sites/default/fil ... riors_full_paper.pdf (application/pdf)

Related works:
Working Paper: Estimating Bayesian Decision Problems with Heterogeneous Priors (2015)
Working Paper: Estimating Bayesian Decision Problems with Heterogeneous Priors (2013)
Working Paper: Estimating Bayesian Decision Problems with Heterogeneous Priors (2013)
Working Paper: Estimating Bayesian Decision Problems with Heterogeneous Priors (2013)
Working Paper: Estimating Bayesian decision problems with heterogeneous priors (2013)
Working Paper: Estimating Bayesian decision problems with heterogeneous priors (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2013-18

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