Semi-Parametric Approach to Behavioral Biases

No 2401, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: This paper shows how to recover behavioral biases from revealed preference ranking implied by choices. The approach formalizes and unifies well-known behavioral models, including salience thinking, inattention, and logarithmic perception, thereby accounting for many well-documented choice puzzles. I show that this approach provides a way to filter out choice data from behavioral biases explaining rationality breaches before fitting parametric utility models. The approach is applied to workhorse data sets of the literature on choice under risk and scanner consumer choices.

Keywords: Decision Theory; revealed preference; Behavioral Economics (search for similar items in EconPapers)
JEL-codes: D11 D81 D91 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2024-02
New Economics Papers: this item is included in nep-dcm, nep-evo and nep-upt
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Working Paper: Semi-Parametric Approach to Behavioral Biases (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:2401

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