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On the identification of changing tastes

On the identification of changing tastes
On the identification of changing tastes
In a dynamic choice environment, an agent’s tastes may change over time (e.g., due to present bias, habit formation, or reference dependence). These changes are often systematic with important welfare and policy implications. In this paper, we propose a framework to identify an agent’s anticipation about how her preferences change over time and provide a heuristic measure that can inform the design of economic policies. In particular, our method resolves identification issues arising in the previous literature by using the intuitive idea that, while tastes can change, rankings are often monotone with respect to a suitable dominance relation.
0899-8256
203-216
Mihm, Max
3123d6b8-55e0-4cd4-ada5-542cd1f1f58f
Ozbek, Kemal
e7edfcf5-cb17-4e64-bfa4-30fb527d2e46
Mihm, Max
3123d6b8-55e0-4cd4-ada5-542cd1f1f58f
Ozbek, Kemal
e7edfcf5-cb17-4e64-bfa4-30fb527d2e46

Mihm, Max and Ozbek, Kemal (2019) On the identification of changing tastes. Games and Economic Behavior, 116, 203-216. (doi:10.1016/j.geb.2019.04.014).

Record type: Article

Abstract

In a dynamic choice environment, an agent’s tastes may change over time (e.g., due to present bias, habit formation, or reference dependence). These changes are often systematic with important welfare and policy implications. In this paper, we propose a framework to identify an agent’s anticipation about how her preferences change over time and provide a heuristic measure that can inform the design of economic policies. In particular, our method resolves identification issues arising in the previous literature by using the intuitive idea that, while tastes can change, rankings are often monotone with respect to a suitable dominance relation.

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Accepted/In Press date: 1 April 2016
e-pub ahead of print date: 27 May 2019

Identifiers

Local EPrints ID: 435834
URI: http://eprints.soton.ac.uk/id/eprint/435834
ISSN: 0899-8256
PURE UUID: 93704d07-ea06-41b6-9f6c-0364c1d73069

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Date deposited: 21 Nov 2019 17:30
Last modified: 12 Feb 2020 17:35

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