We investigate whether a higher level of complexity leads to increased reliance on expert knowledge when voting. We find that when more referenda are held on the same day, constituents are more likely to refer to parliamentary recommendations in making their decisions.
Here is a link to a short YouTube presentation http://www.youtube.com/watch?v=RH2vmbAiwrQ on our research. I would be glad if you could give me your comments.
We investigated whether are smokers more rational than non-smokers (ex-smokers). In order to determine rationality of smokers, we used the following table:
Please choose one of the alternatives (question in the questionnaire)
Alternative 1
Reward : 100 000, Winning probability: 100%, Time delay: Now.
Alternative 2:
Reward: 150 000, Winning probability: 90%, Time delay:The month.
Alternative 3
Reward: 200 000, Winning probability: 80%, Time delay: Six months.
Alternative 4
Reward: 250 000, Winning probability: 60%, Time delay: The year.
Alternative 5
Reward: 300 000, Winning probab ility: 40%, Time delay: 5 years.
The sum of the probability of all possible outcomes (profit and loss) equals one, so the risk aversion coefficient equals total probability minus the losing probability (the risk). This means that the risk aversion coefficient equals winning probability.
Time delay is used to determine the time preference rate . if the time delay is longer, the actors are more impatient and expect a higher reward in the future. For examples if the reward of 100 000 that the individual will get for year, worths 250 000 (Alternative 4), the time preference rate, in this case, is 150%.
In the general case, let the utility of alternative i be Vi. In the rational choice model, the utility of alternative is calculated based on the equation of discounted and expected utility:
Discounted utility: exp(–TIME*timedelayi)*utility(rewardi), (1)
where parameter TIME denotes the rate of time preference.
Expected utility: probabilityi*utility(rewardi). (2)
Accordingly, rewriting Vi, we obtain:
Vi(rewardi, probabilityi, timedelayi) = exp(–TIME*timedelayi)*probabilityi*utility(rewardi). (3)
At this point, we simply specify the functional form of utility as the RISK-th power of reward. Such a utility function is called the constant relatively risk-averse form, where the coefficient of the relative risk aversion is denoted by 1-RISK. Taking logarithms of both sides, we obtain:
lnVi (rewardi, probabilityi, timedelayi)=–TIME*timedelayi+ ln probabilityi+RISK*ln rewardi (4)
Formula (4) was used (in the survey) to measure the net utility (rationality) of current and former smokers.
According to formula (4), value of alternative 1 is 0, alternative 2 1.065, alternative 3 1.96, alternative 4 3.71 and alternative 5 4.65.
We found that, from 487 respondents, 364 of them (75% of current and former smokers) prefered safe profit (or the alternative 1). This means that hypothesis: “Ex-smokers are more rational than the current smokers”, was not confirmed.
In this article we test concepts linked to bounded rationality: "Bounded Rationality and Voting Decisions over 160 Years: Voter Behavior and Increasing Complexity in Decision-Making", PLOS ONE, 2013.
Article Bounded Rationality and Voting Decisions over 160 Years: Vot...
Hi, You who gave me negative vote, please introduce yourself and explain your opinion.
Marry Christmas to all who celebtate this holiday today.
In Organizational psychology is there any ,measure of bounded rationality available ?
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