Abstract
This paper makes a modest contribution to investigating whether people, when tackling dynamic decision problems, formulate plans and then implement them. Assumed behaviour of this form is central to many theories of economic decision-making, yet much direct empirical evidence (from economists and particularly from psychologists) suggests that it has rather dubious empirical support. The paper begins by discussing the importance and centrality of planning to economic theories of dynamic decision-making, and then examines the difficulty of empirically investigating whether planning occurs. It then describes a simple experiment that sheds some light on this phenomenon. The findings from the experiment, although only directly relevant to the context of the experiment, do suggest that people do (want to) plan when the circumstances are appropriate. The paper concludes by discussing alternative designs.
| Original language | English |
|---|---|
| Pages (from-to) | 122-138 |
| Number of pages | 17 |
| Journal | Scottish Journal of Political Economy |
| Volume | 52 |
| Issue number | 1 |
| Publication status | Published - Feb 2005 |
Keywords
- EXPECTED UTILITY
- DYNAMIC CHOICE
- INDUCED PREFERENCES
- UNCERTAINTY