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News on the effects of bounded rationality in economics and business, relationships and politics
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This View of Life: On Adaptability vs. Resilience

This View of Life: On Adaptability vs. Resilience | Bounded Rationality and Beyond | Scoop.it

Rafe Sagarin discusses the difference between adaptation and resilience in this answer to an audience question at the January 24, 2012 Signature Lecture for the Centre for International Governance Innovation in Waterloo, Ontario, Canada.

In short, adaptability seems to capture the idea better of changing to deal with new conditions, whereas resilience can imply the ability to return to a previous state. Most resilience scholars are careful to note the difference between the brittleness that comes from returning to a previous state no matter what the cost (e.g., homeowners using flood insurance to rebuild on a flood plain) and the kind of elastic resilience that makes one a better performer in the future, but I still like the easier applicability and lesser degree of confusion with adaptation. 

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Introduzione alle Neuroscienze

Introduzione alle Neuroscienze | Bounded Rationality and Beyond | Scoop.it
Di cosa si occupano le neuroscienze? Quando e come sono nate? Seguendo la traccia della lezione magistrale tenuta dal Prof. Arnaldo Benini (Il Cervello Umano alla Ricerca di Se Stesso. Le Neuroscienze nella Storia delle Idee – 28-05-2005) presso la Libera Università di Neuroscienze Anemos, cerchiamo di comprendere orizzonti e ipotesi di sviluppo di un campo disciplinare che gode attualmente di un grande fervore. Partendo dalla natura essenzialmente riduzionista delle neuroscienze, l'articolo individua il percorso nella storia delle idee che ha portato a porsi antichi problemi filosofici in termini neuroscientifici e illustra come dal continuo dibattito interdisciplinare (con filosofia, biologia, scienze cognitive) nascano interrogativi intorno al libero arbitrio, alla volontà umana e alla concezione dell'uomo di sè stesso.
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Video Player

Video Player | Bounded Rationality and Beyond | Scoop.it
Prize Lecture by Daniel Kahneman(38 minutes)

Daniel Kahneman held his Prize Lecture December 8, 2002, at Aula Magna, Stockholm University. He was presented by Professor Torsten Persson, Chairman of the Prize Committee.

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Is Behavioral Economics the Death of Living Wills?

Is Behavioral Economics the Death of Living Wills? | Bounded Rationality and Beyond | Scoop.it
As a physician who conducts research on decision-making, I have been asked many times: What does behavioral economics teach us about the role of living wills in medical care?
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Economics and Psychology Research: Most cited papers in behavioral economics

Economics and Psychology Research: Most cited papers in behavioral economics | Bounded Rationality and Beyond | Scoop.it

I used Google Scholar and Web of Science to create a list of the most cited papers in behavioural economics. This process drew mostly on my own knowledge and research and required a certain amount of subjective judgment as to what constituted a 'behavioral economic' paper and what did not. I acknowledge that I may have missed some papers and would welcome correction. I'm reasonably confident about the veracity of the top 10, my confidence intervals widen beyond that. Citations are accurate as of today. If you'd like the excel file containing the top 50 let me know.

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Current Progress in QPP-Related Research Quantum Paradigm of Psychopathology Group

The QPP conference in Palermo has marked a definite turning point in the foundational perspective of many of the group’s participants regarding the study of psychopathology, particularly mood disorders.
One reason for this turning point stems from a realization that two of the most common forms of psychopathology, major depression and bipolar disorder, may be recognizable by means of biomolecular markers. Long years of theoretical study by independent investigators have finally
culminated in a convergence of their insights via quantum paradigms that now promise to illuminate, through the empirically tangible route of such new biomolecular markers, pathological phenomena of the conscious brain, thus potentially both confirming in fact and further harmonizing the diverse prior contributions of these conceptually innovative psychiatrists, biochemists, molecular biologists,
philosophers and theologians.

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ImpactofTaxesonEconomicbehavior.pdf

Though economists differ on many issues, there are a few basic concepts onwhich virtually all agree. One of themost important is the concept that peo-ple respond to incentives—people make decisions by comparing the costs andbenefits of a particular action. When either the costs or benefits change, people’sbehavior also changes.Taxes distort the behavior of individuals because the decisions they make based on prices and taxes change the relative prices of goods, services, and inputs. They make some things more expensive and others relatively less expensive.  This article, based on a chapter inthe soon to be released Fraser Institute book on tax reform, reviews some of theresearch on the impact of taxes—particularly, marginal taxes—on our decisions to work more, save, invest, and engage in entrepreneurial activity.
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Debiasing through Law

In many settings, human beings are boundedly rational. A distinctive and insufficiently explored legal response to bounded rationality is to attempt to "debias through law," by steering people in more rational directions. In many important domains, existing legal analyses emphasize the alternative approach of insulating outcomes from the effects of boundedly rational behavior, often through blocking private choices. In fact, however, a large number of actual and imaginable legal strategies are efforts to engage in the very different approach of debiasing through law by reducing or even eliminating people's boundedly rational behavior. In important contexts, these efforts to debias through law can avoid the costs and inefficiencies associated with regulatory approaches that take bounded rationality as a given and respond by attempting to insulate outcomes from its effects. This paper offers a general account of how debiasing through law does or could work to address legal questions across a range of areas, from consumer safety law to corporate law to property law. Discussion is also devoted to the risks of government manipulation and overshooting that are sometimes raised when debiasing through law is employed.

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Heuristics for dodging Swiss customs - Decision Science News

Heuristics for dodging Swiss customs - Decision Science News | Bounded Rationality and Beyond | Scoop.it
When leaving an international airport, you may see a passenger with large suitcases up on the tables. How the customs officers decide which people to stop?

How does expertise impact the selection of decision strategies? We asked airport customs officers and a novice control group to decide which passengers (describedon several cue dimensions) they would submit to a search. Additionally, participants estimated the validities of the different cues. Then we modeled the decisions using compensatory strategies, which integrate many cues, and a noncompensatory heuristic, which relies on one-reason decision making. The majority of the customs officers were best described by the noncompensatory heuristic, whereas the majority of the novices were best described by a compensatory strategy. We also found that the experts’ subjective cue validity estimates showed a higher dispersion across the cues and that differences in cue dispersion partially mediated differences in strategy use between experts and novices. Our results suggest that experts often rely on one-reason decision making and that expert–novice differences in strategy selection may reflect a response to the internal representation of the environment.

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Daniel Kahneman e Amos Tversky: la teoria del prospetto

Daniel Kahneman e Amos Tversky: la teoria del prospetto | Bounded Rationality and Beyond | Scoop.it
La teoria del prospetto, proposta da Kahneman e Tversky in un articolo del 1979, è una nuova teoria descrittiva delle scelte in condizioni d'incertezza, c..
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Beard Psychology: 4 Signals That Serious Facial Hair Sends

Beard Psychology: 4 Signals That Serious Facial Hair Sends | Bounded Rationality and Beyond | Scoop.it
Are bearded men good with babies? Are beards attractive to women? In a fight, do beards help or hinder?
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Cancellare i ricordi? Dibattito acceso a Milano

Cancellare i ricordi? Dibattito acceso a Milano | Bounded Rationality and Beyond | Scoop.it
 "Manipolare la memoria"? O sì o no, ma con coscienza. Questo è quanto è emerso dal dibattito di ieri sera alla storica libreria Feltrinelli di via Manzoni a Milano, in occasione della presentazione del libro di Andrea Lavazza e Silvia Inglese. Moderato da Marco Mozzoni(Università degli Studi di Milano Bicocca), hanno preso parte, oltre agli Autori, anche Edoardo Boncinelli (Università Vita Salute di Milano) eVittorio Sironi (Università di Milano Bicocca
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Don't bother smiling, scientists are now able to tell if we are happy or sad using BRAIN SCANS

Don't bother smiling, scientists are now able to tell if we are happy or sad using BRAIN SCANS | Bounded Rationality and Beyond | Scoop.it
Researchers at the Carnegie Mellon University in Pittsburgh believe the findings could be used to help develop treatments for patients with mental health conditions.
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This View of Life: Toward A Neo-Darwinian Synthesis Of Neoclassical And Behavioral Economics

This View of Life: Toward A Neo-Darwinian Synthesis Of Neoclassical And Behavioral Economics | Bounded Rationality and Beyond | Scoop.it

Economics is in the midst of a quiet crisis having undergone a schism forty years ago, and showing no signs of healing. In the paper, “Towards a neo-Darwinian synthesis of neoclassical and behavioral economics,” I argue that the natural sciences provide the best route to re-unite economics. 

Economics is divided into the neoclassical school that assumes people are rational maximizers and the behavioral school that argues people are, in the words of Richard Thaler, “dumber and nicer” than neoclassical economists assume.

Behavioral economics has become more powerful because it has documented a series of deviations between the behavior of actual living people, and the predicted behavior of Homo economicus.

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A THEORY OF FAIRNESS, COMPETITION, AND COOPERATION - ERNST FEHR AND KLAUS M. SCHMIDT

There is strong evidence that people exploit their bargaining power in
competitive markets but not in bilateral bargaining situations.There is also strong evidence that people exploit free-riding opportunities in voluntary cooperation games. Yet, when they are given the opportunity to punish free riders, stable cooperation is maintained, although punishment is costly for those who punish. This paper asks whether there is a simple common principle that can explain this puzzling evidence. We show that if some people care about equity the puzzles can be resolved. It turns out that the economic environment determines whether the fair types or the selŽsh types dominate equilibrium behavior

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Explorations of the Mind - Intuition: The Marvels and the Flaws with Daniel Kahneman

Explorations of the Mind - Intuition: The Marvels and the Flaws with Daniel Kahneman | Bounded Rationality and Beyond | Scoop.it

University of California Television - Daniel Kahneman is an internationally renowned psychologist whose work spans cognitive psychology, behavioral economics, and the science of well-being. In recognition of his groundbreaking work on human judgment and decision-making, Kahneman received the 2002 Nobel Prize. In this program he explores the idea of intuition. 

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Bad behaviour: Britain won't nudge its way to a better economy

It is known as the Nudge unit; a government behavioural insights team, that draws on theories popularised in a bestselling book from Yale.Following much hype and publicity, the behavioural insights team…...
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Response Time and Decision Making: A “Free” Experimental Study - Ariel Rubinstein

Abstract
Response time is used to interpret choice in decision problems. It is first establishes that there is a correlation between short response time and choices that are clearly a mistake. It is then determines whether a correlation also exists between response time and behavior that is
inconsistent with some standard theories of decision making. The lack of such a correlation is interpreted to imply that such behavior does not reflect a mistake. It is also shown that a typology of slow and fast responders may, in some cases, be more useful than standard typologies.

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The Case For Mixing With Your Eyes Closed » The Recording Revolution

The Case For Mixing With Your Eyes Closed » The Recording Revolution | Bounded Rationality and Beyond | Scoop.it
How To Increase Brain Activity

Just this weekend I was sitting in a workshop at Sweetwater’s GearFest, listening to Grammy award winning engineer Frank Fillipetti talk about recording and mixing in the modern DAW. At one point in the presentation he displayed images of two identical brain scans of a person. Scan #1 showed the brain activity when listening to music with eyes open. Scan #2 showed brain activity when that same person listened to music with eyes closed. And it showed considerable more brain activity happening.

It turns out, the amygdala (or the emotional center of the brain) increases in activity dramatically when presented with aural stimuli and no visual stimuli. Visual stimuli actually impair our ability to listen critically. The point? Looking at your DAW when mixing is a handicap.

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The Problems with Heuristics for Law by Russell B. Korobkin :: SSRN

The Problems with Heuristics for Law by Russell B. Korobkin :: SSRN | Bounded Rationality and Beyond | Scoop.it
Abstract:      
A large body of evidence, now familiar to the legal community,demonstrates that individual judgment and choice is often driven by heuristic-based reasoning as opposed to the pure optimization approach presumed by rational choice theory. The evidence of heuristic-based reasoning presents several challenges for consequentialist legal scholars who wish to make normative public policy recommendations. First, the fact that actors subject to the legal system often rely on heuristics suggests that their behavior will not always maximize their subjective expected utility, undermining the traditional assumptions of law-and-economics scholarship that private contracts are necessarily Pareto efficient and that legal taxes and subsidies can cause actors to behave in a way that maximizes social efficiency. Second, the fact that the decision makers who create law also rely on heuristics suggests that law will not necessarily maximize the desired ends of lawmakers, whether those ends are the collective good or the utility of favored groups, and that law that attempts to create incentives for certain behaviors might not be properly calibrated to its goal. Parts Iand II of this essay describe these two problems that heuristics cause for law, and Part III considers steps that lawmakers can take to mitigate the problems. This essay was prepared for the June 2004 Dahlem Conference on Heuristics and the Law.

 


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Il principio di razionalità nella teoria economica neoclassica

Il principio di razionalità nella teoria economica neoclassica | Bounded Rationality and Beyond | Scoop.it
Una delle assunzioni più forti su cui il paradigma ortodosso in economia fonda i suoi modelli previsionali è quella della razionalità assoluta.
Il sup
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On the Difference between Binary Prediction and True Exposure, with Implications for Forecasting Tournaments and Prediction Markets by Nassim Nicholas Taleb, Philip E. Tetlock

On the Difference between Binary Prediction and True Exposure, with Implications for Forecasting Tournaments and Prediction Markets by Nassim Nicholas Taleb, Philip E. Tetlock | Bounded Rationality and Beyond | Scoop.it
There are serious differences between predictions, bets, and exposures that have a yes/no type of payoff, the "binaries", and those that have varying
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Psychology in Brief: 5 Things We Didn't Know Last Week

Psychology in Brief: 5 Things We Didn't Know Last Week | Bounded Rationality and Beyond | Scoop.it
Coffee shops boost creativity--Quit smoking trick--Alzheimer's drug hope--Weight-loss improves brain function--Save dog or person, you decide.
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The Brain and the Law: How Neuroscience Will Shift Blameworthiness

Insights from neuroscience are challenging long-held assumptions at the core of our criminal justice system. Are all brains really created equal? Is mass incarceration the most fruitful method of dealing with juveniles, the mentally ill, and the drug-addicted? Do emerging technologies such as real-time brain imaging offer new methods of rehabilitation? David Eagleman explains how most behaviors are driven by brain networks that we do not consciously control, and why the legal system will eventually be forced to shift its emphasis from individual blameworthiness to analysis of likely future behavior..
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