Fakers becoming believers: how opinion dynamics are shaped by preference falsification,impression management and coherence heuristics

In the vast and rich literature on opinion dynamics, the role of preference falsification has generally been dismissed. Following the lead of Timur Kuran, in this paper we present one of the first multi-agent models that explores how opinion dynamics can be affected by the possible divorce between private and public opinions. It is also the first attempt to explore the role of social hierarchies in opinion dynamics conditioned by preference falsification. Our model formalizes heterogeneous evolving agents guided by a cognitively feasible set of heuristics and embedded in a social-rank-dependent structure of interactions. In social-rank-heterophilic encounters where people experience a high pressure of face-to-face interactions, unanimous support for the high social-rank preferred option emerges, while in any other scenario this option gathers majority but not unanimous support. Preference falsification has a crucial role in the emergence of unanimity, but it also creates the conditions for further private opinion actualizations that end up generating a self-sustained and sincere unanimity. When social-rank-homophilic encounters are the rule, or when group dynamics are irrelevant for opinion expression, agents never find incentives to falsify their opinions, therefore generating a social situation that resembles the general idea behind the ethnographic work of James C. Scott: true opinion expression in daily social-rank-homophilic encounters and a persistent opinion falsification in dissimilar social-rank interactions.     

Productivity and unemployment: an ABM approach

Journal of Economic Interaction and Coordination - We investigate the relationship between productivity and unemployment with an ABM approach. In particular, we use the framework of Riccetti et al....     

Sequential choice behavior: Going on vacation and type of destination

The literature of destination choice has so far studied multi-stage decision making processes that are more representative of the general choice behavior of tourists (e.g. going on vacation, going abroad, and destination country). Alternatively, this study proposes a multi-stage decision process to the choice of tourist destination types (going on vacation, coastal character, and urban character of the destination) as these choice sets are more idiosyncratic to tourists who prefer a specific type of tourist destination (e.g. Spain with clear coastal and inland variations). In order to test this multi-stage choice process as well as the sequential order of both decisions, coastal character and urban character, the current study analyses decision processes vs. different hierarchical multi-stage processes (going on vacation and coastal character preceding urban character; and going on vacation and urban character preceding coastal character). The empirical findings support the existence of a multi-stage choice process where coastal character precedes the urban character destination choice. The main implication of these findings is that, given the limited human analytical capability, a hierarchical choice process can be useful to handle the information overload and the complexity inherent to the destination type choice.     

Envy-Free Solutions to the Problem of Room Assignment and Rent Division

Group Decision and Negotiation - We have 3 students who wish to share the rent of an apartment together. There is a problem. The bedrooms have different characteristics. How does one assign the...     

Social comparisons in wage delegation: experimental evidence

We make two main contributions in this article. We examine whether social comparisons affects workers’ performance when a firm can choose workers’ wages or let them choose their own. Firms can delegate the wage decision to neither, one or both workers in the firm. We vary the information workers receive, finding that social comparisons concerning both wages and decision rights affect workers’ performance. Our second contribution is methodological. We find that our treatment effects are present with both stated effort and a real-effort task, which suggests that both approaches may yield similar results in labor experiments.     

Industrial leadership in science-based industries: A co-evolution model

In this paper, we seek to analyse the role of national university systems in combination with technological and market factors as sources of industrial leadership and industry growth in science-based industries. We propose a model in which national university systems and their respective national firms and industries are considered as co-evolving. National firms compete on a worldwide level and they rely on the progress of science and the availability of scientists to innovate. As the global industry develops, firms try to mold their national university systems, but they achieve different degrees of success. Apart from highlighting the role of institutional responsiveness as a source of competitive advantage, our model points to the access to essential inputs for production, the technological and strategic characteristics of firms, the international diffusion of knowledge, and the initial distribution of market demand as key sources of leadership and industry growth. The international mobility of scientists seems to foster the emergence of industrial leadership shifts.     

Marketing Intelligent Systems for consumer behaviour modelling by a descriptive induction approach based on Genetic Fuzzy Systems

In its introduction this paper discusses why marketing professionals do not make satisfactory use of the marketing models posed by academics in their studies. The main body of this research is characterised by the proposal of a brand new and complete methodology for knowledge discovery in databases (KDD), to be applied in marketing causal modelling and with utilities to be used as a marketing management decision support tool. Such methodology is based on Genetic Fuzzy Systems, a specific hybridization of artificial intelligence methods, highly suited to the research problem we face. The use of KDD methodologies based on intelligent systems like this can be considered as an avant-garde evolution, exponent nowadays of the so-called knowledge-based Marketing Management Support Systems; we name them as Marketing Intelligent Systems. The most important questions to the KDD process-i.e. pre-processing; machine learning and post-processing-are discussed in depth and solved. After its theoretical presentation, we empirically experiment with it, using a consumer behaviour model of reference. In this part of the paper, we try to offer an overall perspective of how it works. The valuation of its performance and utility is very positive.     

Optimal accident compensation schemes

This paper considers the way in which accident compensation is offered as insurance against personal injury due to accidents. We begin by setting up a simple microeconomic model in which accident compensation schemes can be studied. Using this model, the accident compensation scheme that maximizes the expected utility of the insured for a given expected outlay of the scheme (that is, for a budget constraint for the insurer) is characterized. We show that, in order for the optimal schedule of indemnities to be increasing (more severe accidents lead to greater compensation) then, contrary to what has been assumed in the literature, the marginal utility of wealth must be decreasing in health. In particular, if the marginal utility of wealth is non-decreasing in health, then an optimal indemnity schedule cannot provide full compensation, in the sense that utility in each state is a constant. Financial support from Secretaría de Estado de Universidades e Investigación del Ministerio de Educación y Ciencia is gratefully acknowledged by F. J. Vázquez.     

Why Do Resource-Abundant Economies Grow More Slowly?

This article suggests an alternative explanation for why resource-rich economies have lower growth rates: because they are likely to be living beyond their means. It is shown that overshooting the steady state's equilibrium consumption and investment can be optimal in a Ramsey growth model with natural resources. Therefore, the economy will converge to its steady state from above, displaying negative growth rates on the transition. A dynamic general equilibrium model is calibrated to the Venezuelan economy and shown to approximate the economy's performance over the oil boom years adequately.