Vinsamlegast notið þetta auðkenni þegar þið vitnið til verksins eða tengið í það: http://hdl.handle.net/1946/41697
The standard economic model of human behavior (SEMHB) has been under review ever since its inception. Its predictions have been compared to real world outcomes and the model has often predicted outcomes which do not correspond with the outcomes which are later realized. It is commonly believed that the models’ tendency for error is largely caused by its assumptions. Most notable are the assumptions that each economic actor possesses unbounded rationality, unbounded willpower, and unbounded selfishness. The essence of this thesis is the development of a model that unites elements, such as information gathering, information processing costs, and dual process theory to the SEMHB. It does so by assuming that each decision is based on two steps, where in the first step, the individual determines which system will be used for the ultimate decision, and in the second step, utilizes the chosen system.
A theoretical analysis of the model shows that it allows for outcomes that seem irrational to an examiner but are not based on irrational behavior, as opposed to the SEMHB, which allows for neither. Additionally, the model predicts that majority of markets can be deemed somewhat inefficient, as consumer behavior is likely characterized either by low consumer interest and/or limited access to unbiased information. Lastly, the model implies that the current market for consumer information, largely supplied by Alphabet, Inc. and Meta Platforms, Inc., suffers from a principal-agent problem - where consumer information suppliers are incentivized to sell market power and consumer welfare to the highest bidder.
|The Cost of Thinking2.pdf