Advances in Behavioral Economics

Published by Princeton University Press 2004

Advances in Behavioral Economics

Edited by: Colin F. Camerer , George Loewenstein and Matthew Rabin

In the series The Roundtable Series in Behavioral Economics

https://doi.org/10.1515/9781400829118

Overview
Contents

About this book

Twenty years ago, behavioral economics did not exist as a field. Most economists were deeply skeptical--even antagonistic--toward the idea of importing insights from psychology into their field. Today, behavioral economics has become virtually mainstream. It is well represented in prominent journals and top economics departments, and behavioral economists, including several contributors to this volume, have garnered some of the most prestigious awards in the profession.

This book assembles the most important papers on behavioral economics published since around 1990. Among the 25 articles are many that update and extend earlier foundational contributions, as well as cutting-edge papers that break new theoretical and empirical ground.

Advances in Behavioral Economics will serve as the definitive one-volume resource for those who want to familiarize themselves with the new field or keep up-to-date with the latest developments. It will not only be a core text for students, but will be consulted widely by professional economists, as well as psychologists and social scientists with an interest in how behavioral insights are being applied in economics.

The articles, which follow Colin Camerer and George Loewenstein's introduction, are by the editors, George A. Akerlof, Linda Babcock, Shlomo Benartzi, Vincent P. Crawford, Peter Diamond, Ernst Fehr, Robert H. Frank, Shane Frederick, Simon Gächter, David Genesove, Itzhak Gilboa, Uri Gneezy, Robert M. Hutchens, Daniel Kahneman, Jack L. Knetsch, David Laibson, Christopher Mayer, Terrance Odean, Ted O'Donoghue, Aldo Rustichini, David Schmeidler, Klaus M. Schmidt, Eldar Shafir, Hersh M. Shefrin, Chris Starmer, Richard H. Thaler, Amos Tversky, and Janet L. Yellen.

Author / Editor information

Colin F. Camerer is Rea A. and Lela G. Axline Professor of Business Economics at the California Institute of Technology. He is the author of Behavioral Game Theory (Princeton). George Loewenstein is Professor of Economics and Psychology at Carnegie Mellon University. Matthew Rabin, Professor of Economics at the University of California, Berkeley, received the John Bates Clark Medal of the American Economics Association for 2001.

Topics

Frontmatter Publicly Available Download PDF	i
CONTENTS Publicly Available Download PDF	vii
LIST OF CONTRIBUTORS Publicly Available Download PDF	xi
PREFACE Publicly Available Download PDF	xxi
ACKNOWLEDGMENTS Publicly Available Download PDF	xxv
PART I: Introduction
CHAPTER ONE. Behavioral Economics: Past, Present, Future Colin F. Camerer and George Loewenstein Requires Authentication Unlicensed Licensed Download PDF	3
PART II: Basic Topics
REFERENCE-DEPENDENCE AND LOSS-AVERSION
CHAPTER TWO. Experimental Tests of the Endowment Effect and the Coase Theorem Daniel Kahneman, Jack L. Knetsch and Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	55
CHAPTER THREE. Mental Accounting Matters Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	75
PREFERENCES OVER RISKY AND UNCERTAIN OUTCOMES
CHAPTER FOUR. Developments in Nonexpected-Utility Theory: The Hunt for a Descriptive Theory of Choice under Risk Chris Starmer Requires Authentication Unlicensed Licensed Download PDF	104
CHAPTER FIVE. Prospect Theory in the Wild: Evidence from the Field Colin F. Camerer Requires Authentication Unlicensed Licensed Download PDF	148
INTERTEMPORAL CHOICE
CHAPTER SIX. Time Discounting and Time Preference: A Critical Review Shane Frederick, George Loewenstein and Ted O’Donoghue Requires Authentication Unlicensed Licensed Download PDF	162
CHAPTER SEVEN. Doing It Now or Later Ted O’Donoghue and Matthew Rabin Requires Authentication Unlicensed Licensed Download PDF	223
FAIRNESS AND SOCIAL PREFERENCES
CHAPTER EIGHT. Fairness as a Constraint on Profit Seeking: Entitlements in the Market Daniel Kahneman, Jack L. Knetsch and Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	252
CHAPTER NINE. A Theory of Fairness, Competition, and Cooperation Ernst Fehr and Klaus M. Schmidt Requires Authentication Unlicensed Licensed Download PDF	271
CHAPTER TEN. Incorporating Fairness into Game Theory and Economics Matthew Rabin Requires Authentication Unlicensed Licensed Download PDF	297
CHAPTER ELEVEN. Explaining Bargaining Impasse: The Role of Self-Serving Biases Linda Babcock and George Loewenstein Requires Authentication Unlicensed Licensed Download PDF	326
GAME THEORY
CHAPTER TWELVE. Theory and Experiment in the Analysis of Strategic Interaction Vincent P. Crawford Requires Authentication Unlicensed Licensed Download PDF	344
CHAPTER THIRTEEN. Behavioral Game Theory: Predicting Human Behavior in Strategic Situations Colin F. Camerer Requires Authentication Unlicensed Licensed Download PDF	374
PART III: Applications
MACROECONOMICS AND SAVINGS
CHAPTER FOURTEEN. Mental Accounting, Saving, and Self-Control Hersh M. Shefrin and Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	395
CHAPTER FIFTEEN. Golden Eggs and Hyperbolic Discounting David Laibson Requires Authentication Unlicensed Licensed Download PDF	429
CHAPTER SIXTEEN. The Fair Wage-Effort Hypothesis and Unemployment George A. Akerlof and Janet L. Yellen Requires Authentication Unlicensed Licensed Download PDF	458
CHAPTER SEVENTEEN. Money Illusion Eldar Shafir, Peter Diamond and Amos Tversky Requires Authentication Unlicensed Licensed Download PDF	483
LABOR ECONOMICS
CHAPTER EIGHTEEN. Fairness and Retaliation: The Economics of Reciprocity Ernst Fehr and Simon Gächter Requires Authentication Unlicensed Licensed Download PDF	510
CHAPTER NINETEEN. Labor Supply of New York City Cab Drivers: One Day at a Time Colin F. Camerer, Linda Babcock, George Loewenstein and Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	533
CHAPTER TWENTY. Wages, Seniority, and the Demand for Rising Consumption Profiles Robert H. Frank and Robert M. Hutchens Requires Authentication Unlicensed Licensed Download PDF	548
CHAPTER TWENTY-ONE. Incentives, Punishment, and Behavior Uri Gneezy and Aldo Rustichini Requires Authentication Unlicensed Licensed Download PDF	572
FINANCE
CHAPTER TWENTY-TWO. Myopic Loss-Aversion and the Equity Premium Puzzle Shlomo Benartzi and Richard H. Thaler Requires Authentication Unlicensed Licensed Download PDF	590
CHAPTER TWENTY-THREE. Do Investors Trade Too Much? Terrance Odean Requires Authentication Unlicensed Licensed Download PDF	606
CHAPTER TWENTY-FOUR. Loss-Aversion and Seller Behavior: Evidence from the Housing Market David Genesove and Christopher Mayer Requires Authentication Unlicensed Licensed Download PDF	633
PART FOUR: NEW FOUNDATIONS
CHAPTER TWENTY-FIVE. Case-Based Decision Theory Itzhak Gilboa and David Schmeidler Requires Authentication Unlicensed Licensed Download PDF	659
CHAPTER TWENTY-SIX. Out of Control: Visceral Influences on Behavior George Loewenstein Requires Authentication Unlicensed Licensed Download PDF	689
INDEX Requires Authentication Unlicensed Licensed Download PDF	725