Efficient methods for empirical tests of behavioral economics theories in laboratory and field experiments

In the quest for a descriptive theory of decision-making, the rational actor model in economics imposes rather unrealistic expectations and abilities on human decision makers. The further we move from idealized scenarios, such as perfectly competitive markets, and ambitiously extend the reach of the theory to describe everyday decision making situations, the less sense these assumptions make. Behavioural economics has instead proposed models based on assumptions that are more psychologically realistic, with the aim of gaining more precision and descriptive power. Increased psychological realism, however, comes at the cost of a greater number of parameters and model complexity. Now there are a plethora of models, based on different assumptions, applicable in differing contextual settings, and selecting the right model to use tends to be an ad-hoc process. In this thesis, we develop optimal experimental design methods and evaluate different behavioral theories against evidence from lab and field experiments.

We look at evidence from controlled laboratory experiments. Subjects are presented with choices between monetary gambles or lotteries. Different decision-making theories evaluate the choices differently and would make distinct predictions about the subjects' choices. Theories whose predictions are inconsistent with the actual choices can be systematically eliminated. Behavioural theories can have multiple parameters requiring complex experimental designs with a very large number of possible choice tests. This imposes computational and economic constraints on using classical experimental design methods. We develop a methodology of adaptive tests: Bayesian Rapid Optimal Adaptive Designs (BROAD) that sequentially chooses the "most informative" test at each stage, and based on the response updates its posterior beliefs over the theories, which informs the next most informative test to run. BROAD utilizes the Equivalent Class Edge Cutting (EC²) criteria to select tests. We prove that the EC² criteria is adaptively submodular, which allows us to prove theoretical guarantees against the Bayes-optimal testing sequence even in the presence of noisy responses. In simulated ground-truth experiments, we find that the EC² criteria recovers the true hypotheses with significantly fewer tests than more widely used criteria such as Information Gain and Generalized Binary Search. We show, theoretically as well as experimentally, that surprisingly these popular criteria can perform poorly in the presence of noise, or subject errors. Furthermore, we use the adaptive submodular property of EC² to implement an accelerated greedy version of BROAD which leads to orders of magnitude speedup over other methods.

We use BROAD to perform two experiments. First, we compare the main classes of theories for decision-making under risk, namely: expected value, prospect theory, constant relative risk aversion (CRRA) and moments models. Subjects are given an initial endowment, and sequentially presented choices between two lotteries, with the possibility of losses. The lotteries are selected using BROAD, and 57 subjects from Caltech and UCLA are incentivized by randomly realizing one of the lotteries chosen. Aggregate posterior probabilities over the theories show limited evidence in favour of CRRA and moments' models. Classifying the subjects into types showed that most subjects are described by prospect theory, followed by expected value. Adaptive experimental design raises the possibility that subjects could engage in strategic manipulation, i.e. subjects could mask their true preferences and choose differently in order to obtain more favourable tests in later rounds thereby increasing their payoffs. We pay close attention to this problem; strategic manipulation is ruled out since it is infeasible in practice, and also since we do not find any signatures of it in our data.

In the second experiment, we compare the main theories of time preference: exponential discounting, hyperbolic discounting, "present bias" models: quasi-hyperbolic (α, β) discounting and fixed cost discounting, and generalized-hyperbolic discounting. 40 subjects from UCLA were given choices between 2 options: a smaller but more immediate payoff versus a larger but later payoff. We found very limited evidence for present bias models and hyperbolic discounting, and most subjects were classified as generalized hyperbolic discounting types, followed by exponential discounting.

In these models the passage of time is linear. We instead consider a psychological model where the perception of time is subjective. We prove that when the biological (subjective) time is positively dependent, it gives rise to hyperbolic discounting and temporal choice inconsistency.

We also test the predictions of behavioral theories in the "wild". We pay attention to prospect theory, which emerged as the dominant theory in our lab experiments of risky choice. Loss aversion and reference dependence predicts that consumers will behave in a uniquely distinct way than the standard rational model predicts. Specifically, loss aversion predicts that when an item is being offered at a discount, the demand for it will be greater than that explained by its price elasticity. Even more importantly, when the item is no longer discounted, demand for its close substitute would increase excessively. We tested this prediction using a discrete choice model with loss-averse utility function on data from a large eCommerce retailer. Not only did we identify loss aversion, but we also found that the effect decreased with consumers' experience. We outline the policy implications that consumer loss aversion entails, and strategies for competitive pricing.

In future work, BROAD can be widely applicable for testing different behavioural models, e.g. in social preference and game theory, and in different contextual settings. Additional measurements beyond choice data, including biological measurements such as skin conductance, can be used to more rapidly eliminate hypothesis and speed up model comparison. Discrete choice models also provide a framework for testing behavioural models with field data, and encourage combined lab-field experiments.

Variation in bacterial populations in time and space

Obtaining a reliable estimate of the bacterial population is one of the main problems facing the bacterial ecologist. The author discusses the various methods available and concludes that the observed variability in bacterial populations depends on the sampling interval used.

An algorithm of analysis tools on points distribution in high dimension space: The distance of a point and an infinite sub-space

This paper discusses the algorithm on the distance from a point and an infinite sub-space in high dimensional space With the development of Information Geometry([1]), the analysis tools of points distribution in high dimension space, as a measure of calculability, draw more attention of experts of pattern recognition. By the assistance of these tools, Geometrical properties of sets of samples in high-dimensional structures are studied, under guidance of the established properties and theorems in high-dimensional geometry.

The resonance spectrum of the cusp map in the space of analytic functions

We prove that the Frobenius-Perron operator $U$ of the cusp map $F:[-1,1]\to [-1,1]$, $F(x)=1-2 x^{1/2}$ (which is an approximation of the Poincare section of the Lorenz attractor) has no analytic eigenfunctions corresponding to eigenvalues different from 0 and 1. We also prove that for any $q\in (0,1)$ the spectrum of $U$ in the Hardy space in the disk $\{z\in C:|z-q|

Crossing borders: Space and identity in the essay by Angelina Muñiz

In this study, we establish a relation between the representation of space in Muñiz’s essays and the construction of the essayist’s complex identity which combines Spanish, Jewish and Mexican traits. We concentrate on Angelina Muñiz’s essays Las raíces y las ramas (1993) and El canto del peregrino (1999). Methodologically, we rely on Maingueneau’s concept of ‘scenography’, according to which the text stages its own situation of enunciation. Our starting point is the triple Spanish-Jewish-Mexican identity of the essayist. Our research question is about how the essayist deals with the space corresponding to respectively the Spanish and Mexican part of her identity. Secondly, we analyse the representation in the essays of a space corresponding to her Jewish roots. We find that Muñiz’s vision of space is not static; the essayist’s vision on space is dynamic, open, free and characterized by a constant free movement across national borders. Similar to the concept of space of the ‘diaspora’, her vision is constructed without the limitations imposed by national borderlines or geographical distances.

The circle in the relationship between space and body. Photo-essay based on Isidro Blasco and the BAPNE method

This article demonstrates a visual study on the educational space in which the teaching of body percussion is carried out in universities. The methodological framework is chosen by the Visual Arts Based Educational Research, using the work of an artist as a conceptual and methodological model. The research remains notable (1) due to the theoretical reference to the BAPNE method, (2) due to the visual reference to the work of Isidro Blasco – especially with the piece “Shanghai Planet 2009” - ;(3) due to the parallelisms established between the object of study in this investigation -the spatial analysis- and the focuses of interest revealed by the art critics in relation to the work of this artist. By means of a visual speech formed with 7 photo-collages the relationship between body and educational space is visualized in the basic disposition of circular learning. The visual constructions by way of photo-collage and their aesthetic charge brings us closer to the intimacy of the educational space, in the style in which it is distributed to the students in the music classroom, the materialization of interpersonal relationships, the occupied and empty volumes.

Changing Paradigms in Space Theories:Recapturing 20th Century Architectural History

The concept of space entered architectural history as late as 1893. Studies in art opened up the discussion, and it has been studied in various ways in architecture ever since. This article aims to instigate an additional reading to architectural history, one that is not supported by "isms" but based on space theories in the 20th century. Objectives of the article are to bring the concept of space and its changing paradigms to the attention of architectural researchers, to introduce a conceptual framework to classify and clarify theories of space, and to enrich the discussions on the 20th century architecture through theories that are beyond styles. The introduction of space in architecture will revolve around subject-object relationships, three-dimensionality and senses. Modern space will be discussed through concepts such as empathy, perception, abstraction, and geometry. A scientific approach will follow to study the concept of place through environment, event, behavior, and design methods. Finally, the research will look at contemporary approaches related to digitally supported space via concepts like reality-virtuality, mediated experience, and relationship with machines.

Bringing down the walls: Is the notion of ‘promoting shared space’ commensurate with effective transformation of contested places in Belfast?

This article is a reflexive and critical examination of recent empirical research on effective practice in the management and ‘transformation’ of contested urban space at sectarian interfaces in Belfast. By considering the development of interfaces, the areas around them and policy responses to their persistence, the reality of contested space in the context of ‘peace building’ is apparent; with implications for local government as central to the statutory response. Belfast has developed an inbuilt absence of connectivity; where freedom of movement is particularly restricted and separation of contested space is the policy default position. Empirical research findings focus attention on the significance of social and economic regeneration and fall into three specific areas that reflect both long-term concerns within neighbourhoods and the need for adequate policy responses and action ‘on the ground’. Drawing on Elden and Sassen we reconfigure the analytical framework by which interfaces are defined, with implications for policy and practice in post-conflict Belfast. Past and current policy for peace-building in Northern Ireland, and transforming the most contested space, at interfaces in Belfast, is deliberately ambiguous and offers little substance having failed to advance from funding-led linguistic compliance to a sustainable peace-building methodology.

Relationship Building with Aboriginal Elders in the Publicly Funded Secondary School Classroom: A Study of Ethical Space from an Aboriginal Persepective

This is a current story of ethical space in education that is often neglected in the design of educational experiences for Aboriginal students. This story is told through an Aboriginal lens rooted in the structured Two Row Wampum Belt relational agreement between Aboriginal peoples and Settlers. Through ethnographic narrative based on an extensive literature review, individual in-depth interviews, and a personal journal, this study documents the processes of acceptance, silence, complications, and then rejection to position Aboriginal Elders as inclusive bodies of knowledge in publicly funded secondary school classrooms. Aboriginal Elders are valued as Knowledge Holders, as Aboriginal teachers, guides, and mentors. Yet, the complexities of colonial rights, politics, and policies continue to intrude deeply into the lives of Aboriginal peoples to cause silence, confusion, and struggle rather than an evolution of new knowledge amongst two co-existing solitudes under the original terms of the Two Row Wampum Belt. The study was delayed and then came to an end when the school boards and local schools scrutinized its operating policies and unresolved funding issues. This study demonstrated that despite the Two Row Wampum Belt agreement that promised a co- existent relationship between Aboriginal peoples and Settlers, the strategy of inviting Aboriginal Elders to work alongside teachers in the classroom was viewed as being in conflict with the Settler’s institutional/educational objectivities, and, as such, was denied to Aboriginal students.

Full label space reduction in MPLS networks: asymmetric merged tunneling

Traffic Engineering objective is to optimize network resource utilization. Although several works have been published about minimizing network resource utilization in MPLS networks, few of them have been focused in LSR label space reduction. This letter studies Asymmetric Merged Tunneling (AMT) as a new method for reducing the label space in MPLS network. The proposed method may be regarded as a combination of label merging (proposed in the MPLS architecture) and asymmetric tunneling (proposed recently in our previous works). Finally, simulation results are performed by comparing AMT with both ancestors. They show a great improvement in the label space reduction factor