Becker Friedman Institute

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Selfconfirming long run biases

We consider a myopic decision maker facing a recurrent decision problem. We study selfconfirming strategies. We show that a long run bias emerges that favors “tested” actions, that is, actions on which information has been collected over time. In so doing we provide, inter alia, a learning foundation for the selfconfirming equilibrium with model uncertainty of Battigalli et al. (2011).

Simone Cerreia Vioglio, Bocconi University
Pierpaolo Battigalli, Università Bocconi
Fabio Maccheroni, Università Bocconi
Massimo Marinacci, Bocconi University
Publication Date: 
February, 2013
BFI Initiative: 
Publication Status: