Ariel Rubinstein
Tel Aviv University, Economics, Emeritus
- New York University, Economics, Faculty Memberadd
We propose a new abstract definition of equilibrium in the spirit of competitive equilibrium: a profile of alternatives and a public ordering (expressing prestige, price, or a social norm) such that each agent prefers his assigned... more
We propose a new abstract definition of equilibrium in the spirit of competitive equilibrium: a profile of alternatives and a public ordering (expressing prestige, price, or a social norm) such that each agent prefers his assigned alternative to all lower-ranked ones. The equilibrium operates in an abstract setting built upon a concept of convexity borrowed from convex geometry. We apply the concept to a variety of convex economies and relate it to Pareto optimality. The “magic” of linear equilibrium prices is put into perspective by establishing an analogy between linear functions in the standard convexity and “primitive orderings” in the abstract convexity. (JEL I11, I18, J44, K13)
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Eye tracking is used to investigate decision makers' motivations and procedures in choice problems. Patterns of eye movements in problems where the deliberation process is easily discernable are used to understand the deliberation in... more
Eye tracking is used to investigate decision makers' motivations and procedures in choice problems. Patterns of eye movements in problems where the deliberation process is easily discernable are used to understand the deliberation in other problems. We find that in problems which involve the distribution of income between the participant and another individual, participants who behave selfishly nevertheless take into consideration the size of the payment to the other person. In problems that involve choice between two simple lotteries, eye movements indicate that many participants based their decision on a comparison of prizes and probabilities rather than making an expected utility calculation.
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Eye tracking is used to investigate the procedures that participants employ in choosing between two lotteries. Eye movement patterns in problems where the deliberation process is clearly identified are used to substantiate an... more
Eye tracking is used to investigate the procedures that participants employ in choosing between two lotteries. Eye movement patterns in problems where the deliberation process is clearly identified are used to substantiate an interpretation of the results. The data provide little support for the hypothesis that decision makers rely exclusively upon an expected utility type of calculation. Instead eye patterns indicate that decision makers often compare prizes and probabilities separately. This is particularly true when the multiplication of sums and probabilities is laborious to compute. (JEL D81, D87)
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I heard about Rabin's calibration result from Daniel Kahneman and, like him, I was impressed. Part of the reason is that it does not rely on experiments. It relies instead on a mental experiment and rings true without the need to be... more
I heard about Rabin's calibration result from Daniel Kahneman and, like him, I was impressed. Part of the reason is that it does not rely on experiments. It relies instead on a mental experiment and rings true without the need to be verified. I rushed to add the material to the lecture notes for my graduate micro-economics course. My comments there were in the spirit of Rabin's criticism of expected utility theory:“What conclusion should we derive from this observation? Do we economists take our own findings seriously?” However, ...
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ABSTRACT