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Should Social Scientists Care about Choice Anomalies?

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  • BRUNO S. FREY

    (University of Zurich)

  • REINER EICHENBERGER

    (University of Zurich)

Abstract

The behavioral anomalies found by experimental psychologists (Tversky, Kahneman, and others) relate to the individual level. They are often considered to be irrelevant by economists because competitive markets are assumed to eliminate them at the aggregate level. However, markets are only able to perform this role under very limited conditions that often do not obtain even in the near-perfect stock market. Moreover, democratic, bureaucratic, and bargaining processes may under different identifiable conditions weaken or strengthen the anomalies. At the aggregate level, institutions such as conventions and laws may arise to counteract anomalies.

Suggested Citation

  • Bruno S. Frey & Reiner Eichenberger, 1989. "Should Social Scientists Care about Choice Anomalies?," Rationality and Society, , vol. 1(1), pages 101-122, July.
    • Handle: RePEc:sae:ratsoc:v:1:y:1989:i:1:p:101-122
    DOI: 10.1177/1043463189001001007
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    2. Scharpf, Fritz W., 1991. "Koordination durch Verhandlungssysteme: Analytische Konzepte und institutionelle Lösungen am Beispiel der Zusammenarbeit zwischen zwei Bundesländern," MPIfG Discussion Paper 91/4, Max Planck Institute for the Study of Societies.
    3. Bruno S Frey, 2023. "Camouflage: A dominant reaction to worsening conditions," Rationality and Society, , vol. 35(3), pages 366-384, August.
    4. Bruno S. Frey, 1991. "Demand for, and Supply of, Institutions," Rationality and Society, , vol. 3(2), pages 258-260, April.
    5. Christian Lüdemann, 1998. "Framing And Choice Of Transportation Mode:," Rationality and Society, , vol. 10(2), pages 253-270, May.
    6. Ashworth, John & Heyndels, Bruno & Smolders, Carine, 2003. "Psychological taxing in Flemish municipalities," Journal of Economic Psychology, Elsevier, vol. 24(6), pages 741-762, December.
    7. Thomas Wagner, 1998. "Reciprocity And Efficiency," Rationality and Society, , vol. 10(3), pages 347-375, August.
    8. Bruno S. Frey & Reiner Eichenberger, 1996. "Marriage Paradoxes," Rationality and Society, , vol. 8(2), pages 187-206, May.
    9. Randall Collins, 1993. "Emotional Energy as the Common Denominator of Rational Action," Rationality and Society, , vol. 5(2), pages 203-230, April.
    10. Frey Bruno S., 1990. "L’Effet De Transfert De Motivation," Journal des Economistes et des Etudes Humaines, De Gruyter, vol. 1(3), pages 225-252, October.
    11. Bruno S. Frey & Stephan Meier, "undated". "Two Concerns about Rational Choice: Indoctrination and Imperialism," IEW - Working Papers 104, Institute for Empirical Research in Economics - University of Zurich.
    12. Pommerehne, Werner W. & Frey, Bruno S., 1992. "The effects of tax administration on tax morale," Discussion Papers, Series II 191, University of Konstanz, Collaborative Research Centre (SFB) 178 "Internationalization of the Economy".
    13. Karl-Dieter Opp, 1999. "Contending Conceptions of the Theory of Rational Action," Journal of Theoretical Politics, , vol. 11(2), pages 171-202, April.
    14. Peregrine Schwartz-Shea & Randy T. Simmons, 1991. "Egoism, Parochialism, and Universalism," Rationality and Society, , vol. 3(1), pages 106-132, January.
    15. Scharpf, Fritz W., 1990. "Games Real Actors Could Play: The Problem of Connectedness," MPIfG Discussion Paper 90/8, Max Planck Institute for the Study of Societies.

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