Behavioral Decisions and Policy
AbstractWe study the public policy implications of a model in which agents do not fully internalize all the conscequences of their actions. Such a model uni es seemingly disconected models with behavioral agents. We evaluate the scope of paternalistic and libertarian-parternalistic policies in the light of our model, and propose an alternative type of approach, called soft-libertarian, which guides the decision makers in the internalization of all the conscequences of their ac- tions. Psychotherapy is one example of a soft-libertarian policy. Moreover, we show that in our behavioral framework, policies that increase the set of oppor- tunities or provide more information to the agent may not longer be individual welfare improving.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2010-125.
Date of creation: 2010
Date of revision:
Contact details of provider:
Web page: http://center.uvt.nl
Behavioral Decisions; Revealed Preferences; Normative Preferences; Paternalism; Soft-Libertarian; Autonomy; Psychotherapy;
Other versions of this item:
- D03 - Microeconomics - - General - - - Behavioral Microeconomics; Underlying Principles
- D60 - Microeconomics - - Welfare Economics - - - General
- I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Matthew Rabin, 2006.
"A Model of Reference-Dependent Preferences,"
The Quarterly Journal of Economics,
MIT Press, vol. 121(4), pages 1133-1165, November.
- Koszegi, Botond & Rabin, Matthew, 2004. "A Model of Reference-Dependent Preferences," Department of Economics, Working Paper Series qt0w82b6nm, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Botond Koszegi & Matthew Rabin, 2004. "A Model of Reference-Dependent Preferences," Method and Hist of Econ Thought 0407001, EconWPA.
- Botond Koszegi & Matthew Rabin, 2005. "A Model of Reference-Dependent Preferences," Levine's Bibliography 784828000000000341, UCLA Department of Economics.
- Klaus Wertenbroch, 1998. "Consumption Self-Control by Rationing Purchase Quantities of Virtue and Vice," Marketing Science, INFORMS, vol. 17(4), pages 317-337.
- B. Douglas Bernheim & Antonio Rangel, 2009. "Beyond Revealed Preference: Choice-Theoretic Foundations for Behavioral Welfare Economics-super-," The Quarterly Journal of Economics, MIT Press, vol. 124(1), pages 51-104, February.
- Carrillo, Juan D & Mariotti, Thomas, 2000. "Strategic Ignorance as a Self-Disciplining Device," Review of Economic Studies, Wiley Blackwell, vol. 67(3), pages 529-44, July.
- Richard H. Thaler & Cass R. Sunstein, 2003. "Libertarian Paternalism," American Economic Review, American Economic Association, vol. 93(2), pages 175-179, May.
- Dalton, P.S. & Ghosal, S. & Mani, A., 2011.
"Poverty and Aspirations Failure,"
2011-124, Tilburg University, Center for Economic Research.
- Akerlof, George A & Dickens, William T, 1982. "The Economic Consequences of Cognitive Dissonance," American Economic Review, American Economic Association, vol. 72(3), pages 307-19, June.
- SHALEV, Jonathan, 1997.
"Loss aversion equilibrium,"
CORE Discussion Papers
1997023, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- von Weizsacker, Carl Christian, 1971. "Notes on endogenous change of tastes," Journal of Economic Theory, Elsevier, vol. 3(4), pages 345-372, December.
- John Beshears & James J. Choi & David Laibson & Brigitte C. Madrian, 2008.
"How are Preferences Revealed?,"
NBER Working Papers
13976, National Bureau of Economic Research, Inc.
- John Beshears & James Choi & David Laibson & Brigitte Madrian, 2008. "How are Preferences Revealed?," Yale School of Management Working Papers amz2466, Yale School of Management.
- John Beshears & James Choi & David Laibson & Brigitte Madrian, 2007. "How Are Preferences Revealed?," Levine's Bibliography 122247000000001760, UCLA Department of Economics.
- George Loewenstein & Ted O'Donoghue & Matthew Rabin, 2001.
"Projection Bias in Predicting Future Utility,"
General Economics and Teaching
- George Loewenstein, Ted O'Donoghue and Matthew Rabin., 2000. "Projection Bias in Predicting Future Utility," Economics Working Papers E00-284, University of California at Berkeley.
- Loewenstein, George & O'Donoghue, Ted & Rabin, Matthew, 2000. "Projection Bias in Predicting Future Utility," Department of Economics, Working Paper Series qt5qh6142m, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Loewenstein, George & O'Donoghue, Ted & Rabin, Matthew, 2002. "Projection Bias in Predicting Future Utility," Working Papers 02-11, Cornell University, Center for Analytic Economics.
- Dalton, Patricio & Ghosal, Sayantan, 2008.
"Behavioural Decisions and Welfare,"
The Warwick Economics Research Paper Series (TWERPS)
834, University of Warwick, Department of Economics.
- Sunstein, Cass R. & Thaler, Richard H., 2003.
"Libertarian Paternalism Is Not An Oxymoron,"
- Loewenstein, George & Ubel, Peter A., 2008. "Hedonic adaptation and the role of decision and experience utility in public policy," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1795-1810, August.
- Sen, Amartya K, 1971. "Choice Functions and Revealed Preference," Review of Economic Studies, Wiley Blackwell, vol. 38(115), pages 307-17, July.
- Tversky, Amos & Kahneman, Daniel, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, MIT Press, vol. 106(4), pages 1039-61, November.
- Geanakoplos, John & Pearce, David & Stacchetti, Ennio, 1989. "Psychological games and sequential rationality," Games and Economic Behavior, Elsevier, vol. 1(1), pages 60-79, March.
- Hammond, Peter J., 1976. "Endogenous tastes and stable long-run choice," Journal of Economic Theory, Elsevier, vol. 13(2), pages 329-340, October.
- Schnellenbach, Jan & Schubert, Christian, 2014. "Behavioral public choice: A survey," Freiburg Discussion Papers on Constitutional Economics 14/03, Walter Eucken Institut e.V..
- Christian Schubert & Martin Binder, 2014. "Reconciling Normative and Behavioral Economics: An Application of the “Naturalistic Approach” to the Adaptation Problem," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 234(2-3), pages 350-365, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Richard Broekman).
If references are entirely missing, you can add them using this form.