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A Testable Theory of Imperfect Perception

Author

Listed:
  • Andrew Caplin

    (NYU - New York University [New York] - NYU - NYU System)

  • Daniel Martin

    (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

We provide a characterisation of choice behaviour generated by a Bayesian expected utility maximiser. The observable signature of this standard model is the impossibility of raising utility by switching wholesale from one action to another. We provide applications to robustness, to the recovery of utility from choice data and to model classification.

Suggested Citation

  • Andrew Caplin & Daniel Martin, 2015. "A Testable Theory of Imperfect Perception," Post-Print halshs-01155313, HAL.
  • Handle: RePEc:hal:journl:halshs-01155313
    DOI: 10.1111/ecoj.12130
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-01155313
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Bayesian;

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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