IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-0-230-62515-0_4.html
   My bibliography  Save this book chapter

‘Homo Economicus’ as an intuitive statistician (1): Model-free learning

In: Rationality, bounded rationality and microfoundations

Author

Listed:
  • Reza Salehnejad

Abstract

The subjective expected utility theory is a method for solving an already well-defined decision problem. But prediction of behaviour in dynamic situations requires a theory that explains how the agent models his choice situation and defines his decision problem. The subjective expected utility theory, even if true, is inadequate as a theory of economic behaviour. New classical economics have proposed the rational expectations (RE) hypothesis as a way of specifying the agent’s view of the economy. The hypothesis identifies the agent’s subjective expectations with the mathematical expectations implied by the true economic model, suggesting that he maximizes his expected utility with respect to the true model. So, the new classical paradigm defines economics as the enterprise to derive economic phenomena from two hypotheses: (1) people are expected utility maximizers; and (2) they maximize their expected utility with respect to the true economic model.

Suggested Citation

  • Reza Salehnejad, 2007. "‘Homo Economicus’ as an intuitive statistician (1): Model-free learning," Palgrave Macmillan Books, in: Rationality, bounded rationality and microfoundations, chapter 3, pages 70-105, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-62515-0_4
    DOI: 10.1057/9780230625150_4
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-0-230-62515-0_4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.