IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/36697.html
   My bibliography  Save this paper

A dynamic model of interactions between conscious and unconscious

Author

Listed:
  • Lotz, Aileen
  • Gosselin, Pierre

Abstract

This paper advocates that some limits of the rational agent hypothesis result from the improper assumption that one individual should be modeled as a single rational agent. We model an individual composed of two autonomous and interacting structures, conscious and unconscious. Each agent utility form depends both on external signals and other structures' actions. The perception of the signal depends on its recipient and its grid of interpretation. We study both the static and dynamic version of this interaction mechanism. We show that the dynamics may display instability, depending on the structures interactions'strength. However, if unconscious has a strategic advantage, greater stability is reached. By manipulating other structures�goals, the strategic agent can lead the whole system to an equilibrium closer to its own optimum. This result shows that some switch in the conscious�objective can appear. Behaviors that can't be explained with a single utility can thus be rational if we add a rational unconscious agent. Our results justify our hypothesis of a rational interacting unconscious. It supports the widening of the notion of rationality to multi-rationnality in interaction.

Suggested Citation

  • Lotz, Aileen & Gosselin, Pierre, 2012. "A dynamic model of interactions between conscious and unconscious," MPRA Paper 36697, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:36697
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/36697/1/MPRA_paper_36697.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rabin, Matthew, 2002. "A perspective on psychology and economics," European Economic Review, Elsevier, vol. 46(4-5), pages 657-685, May.
    2. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    3. Lotz, Aïleen, 2011. "An Economic Approach to the Self : the Dual Agent," MPRA Paper 30043, University Library of Munich, Germany.
    4. J. Doyne Farmer & John Geanakoplos, 2008. "The Virtues and Vices of Equilibrium and the Future of Financial Economics," Levine's Working Paper Archive 122247000000002067, David K. Levine.
    5. Hayek, F. A., 2012. "The Trend of Economic Thinking," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226321363 edited by Bartley, III, W. W. & Kresge, Stephen, January.
    6. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    7. Pierre Gosselin & Aileen Lotz & Charles Wyplosz, 2006. "How Much Information should Interest Rate-Setting Central Banks Reveal?," IHEID Working Papers 08-2006, Economics Section, The Graduate Institute of International Studies.
    8. Berg, Nathan, 2010. "Behavioral Economics," MPRA Paper 26587, University Library of Munich, Germany.
    9. Stephen E.G Lea & Paul Webley & Brian M. Young, 1992. "New Directions in Economic Psychology," Books, Edward Elgar Publishing, number 277.
    10. Pierre Gosselin & A. Lotz & C. Wyplosz, 2008. "When Central Banks Reveal Future Interest Rates: Alignment of Expectations Vs. Creative Opacity," Post-Print hal-00383304, HAL.
    11. repec:ucp:bkecon:9780226320670 is not listed on IDEAS
    12. Jon Elster, 1998. "Emotions and Economic Theory," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 47-74, March.
    13. repec:dau:papers:123456789/13502 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gosselin, Pierre & Lotz, Aileen & Wambst, Marc, 2013. "On apparent irrational behaviors : interacting structures and the mind," MPRA Paper 44421, University Library of Munich, Germany.
    2. Pierre Gosselin & Aïleen Lotz & Marc Wambst, 2015. "From Rationality to Irrationality : Dynamic Interacting Structures," Working Papers hal-01122078, HAL.
    3. Pierre Gosselin & Aïleen Lotz & Marc Wambst, 2017. "A Path Integral Approach to Interacting Economic Systems with Multiple Heterogeneous Agents," Working Papers hal-01549586, HAL.
    4. Pierre Gosselin & Aïleen Lotz & Marc Wambst, 2020. "A path integral approach to business cycle models with large number of agents," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 15(4), pages 899-942, October.
    5. Pierre Gosselin & Aïleen Lotz & Marc Wambst, 2018. "A Path Integral Approach to Business Cycle Models with Large Number of Agents," Working Papers hal-01893556, HAL.
    6. Lotz, Aïleen, 2011. "An Economic Approach to the Self : the Dual Agent," MPRA Paper 50771, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lotz, Aïleen, 2011. "An Economic Approach to the Self : the Dual Agent," MPRA Paper 30043, University Library of Munich, Germany.
    2. Jimena Hurtado, 2005. "The Utilitarian Foundations Of The Economic Approach To Human Behavior," Documentos CEDE 3633, Universidad de los Andes, Facultad de Economía, CEDE.
    3. Matteo Rizzolli & Luca Stanca, 2012. "Judicial Errors and Crime Deterrence: Theory and Experimental Evidence," Journal of Law and Economics, University of Chicago Press, vol. 55(2), pages 311-338.
    4. Kavous Ardalan, 2018. "Behavioral attitudes toward current economic events: a lesson from neuroeconomics," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 53(4), pages 202-208, October.
    5. Bruno S. Frey & Matthias Benz, 2004. "From Imperialism to Inspiration: A Survey of Economics and Psychology," Chapters, in: John B. Davis & Alain Marciano & Jochen Runde (ed.), The Elgar Companion To Economics and Philosophy, chapter 4, Edward Elgar Publishing.
    6. Andreas Roider & Patrick W. Schmitz, 2012. "Auctions with Anticipated Emotions: Overbidding, Underbidding, and Optimal Reserve Prices," Scandinavian Journal of Economics, Wiley Blackwell, vol. 114(3), pages 808-830, September.
    7. Ardalan, Kavous, 2018. "Neurofinance versus the efficient markets hypothesis," Global Finance Journal, Elsevier, vol. 35(C), pages 170-176.
    8. Kerri Brick & Martine Visser & Justine Burns, 2012. "Risk Aversion: Experimental Evidence from South African Fishing Communities," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(1), pages 133-152.
    9. Mattos, Enlinson & Rocha, Fabiana & Toporcov, Patricia, 2013. "Programas de incentivos fiscais são eficazes? Evidência a partir da avaliação do impacto do programa nota fiscal paulista sobre a arrecadação de ICMS," Revista Brasileira de Economia - RBE, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil), vol. 67(1), April.
    10. Tomas Bonavia & Josué Brox-Ponce, 2018. "Shame in decision making under risk conditions: Understanding the effect of transparency," PLOS ONE, Public Library of Science, vol. 13(2), pages 1-16, February.
    11. Matthias Kasper & James Alm, 2022. "Does the Bomb-crater Effect Really Exist? Evidence from the Laboratory," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 78(1-2), pages 87-111.
    12. Stefano DellaVigna, 2009. "Psychology and Economics: Evidence from the Field," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 315-372, June.
    13. repec:fgv:epgrbe:v:67:n:1:a:5 is not listed on IDEAS
    14. Stephan Schulmeister, 2000. "Technical Analysis and Exchange Rate Dynamics," WIFO Studies, WIFO, number 25857.
    15. Jacquemet, Nicolas & Rullière, Jean-Louis & Vialle, Isabelle, 2008. "Monitoring optimistic agents," Journal of Economic Psychology, Elsevier, vol. 29(5), pages 698-714, November.
    16. Carrillo, Paul & Emran, M. Shahe, 2018. "Loss Aversion, Transaction Costs, or Audit Trigger? Learning about Corporate Tax Compliance from a Policy Experiment with Withholding Regime," MPRA Paper 87445, University Library of Munich, Germany.
    17. Stephanie Rosenkranz & Patrick W. Schmitz, 2007. "Reserve Prices in Auctions as Reference Points," Economic Journal, Royal Economic Society, vol. 117(520), pages 637-653, April.
    18. James Alm & Antoine Malézieux, 2021. "40 years of tax evasion games: a meta-analysis," Experimental Economics, Springer;Economic Science Association, vol. 24(3), pages 699-750, September.
    19. Dmitri V. Vinogradov & Elena V. Shadrina, 2018. "Discouragement through incentives," Working Papers 2018-05, Business School - Economics, University of Glasgow.
    20. Messer, Kent D., 2010. "Protecting endangered species: When are shoot-on-sight policies the only viable option to stop poaching?," Ecological Economics, Elsevier, vol. 69(12), pages 2334-2340, October.
    21. Ajzenman, Nicolas & López Bóo, Florencia, 2019. "Lessons from Behavioral Economics to Improve Treatment Adherence in Parenting Programs: An Application to SMS," IZA Discussion Papers 12808, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    dual agent; conscious and unconscious; rationality; multi-rationality; emotions; choices and preferences; multi-agent model; consistency;
    All these keywords.

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:pra:mprapa:36697. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    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.