The Professor will present the paper: Cognitive Economics

Abstract:
Human choices are often unstable, dependent on normatively irrelevant features of the problem, and variable across people in similar situations.  Standard economics resolves these challenges by constructing exotic preferences.  Behavioral economics deals with them by proliferating biases.  Neither unifies different phenomena effectively.  

An alternative strategy is to start with regularities of human cognition, such as perception, attention, and memory, and to derive how people represent problems, form beliefs, and make choices from those foundations.  This approach unifies theoretically a broad range of puzzling findings, and incorporates new strategies of measurement and prediction.   We illustrate the ideas of cognitive economics with examples of finance, macroeconomics, labor economics, political economy, and risk assessment using both experimental and field data.