Rational Deterrence Theory: I Think, Therefore I Deter

1989 ◽  
Vol 41 (2) ◽  
pp. 208-224 ◽  
Author(s):  
Richard Ned Lebow ◽  
Janice Gross Stein
Keyword(s):  
Rational Choice ◽  
Strategic Behavior ◽  
Empirical Studies ◽  
Decision Makers ◽  
Deterrence Theory ◽  
Domestic Constraints ◽  
Rational Calculation ◽  
Rational Choice Theories

Deterrence theories purport to supply the auxiliary assumptions rational choice theories need to predict rational strategic behavior. They generally assume that would-be initiators are (i) instrumentally rational; (2) risk-prone gain-maximizers; (3) free of domestic constraints; and (4) able to identify themselves correctly as defenders or challengers. These assumptions are contradicted by empirical studies that indicate that risk-prone, gain-maximizing initiators are relatively uncommon; that leaders at times calculate as deterrence theories expect, but behave contrary to their predictions; and that the calculus of initiators generally depends on factors other than those identified by deterrence theories. Deductive theories of deterrence are also inadequate because they do not define their scope conditions. Nor can they accommodate deviation by initiators from processes of rational calculation. Rational deterrence theories are poorly specified theories about nonexistent decision makers operating in nonexistent environments.

scholarly journals Polarization and extremism emerge from rational choice

2020 ◽  
Author(s):  
Peter D. Kvam ◽  
Matthew Baldwin
Keyword(s):  
Rational Choice ◽  
Information Search ◽  
Empirical Studies ◽  
Motivated Reasoning ◽  
Decision Makers ◽  
Irrational Thinking ◽  
Preferential Choice ◽  
New Information ◽  
Decision Efficiency ◽  
Biased Information

{Polarization is often thought to be the product of biased information search, motivated reasoning, or other psychological biases. However, polarization and extremism can still occur in the absence of any bias or irrational thinking. In this paper, we show that polarization occurs among groups of decision makers who are implementing rational choice strategies that maximize decision efficiency. This occurs because extreme information enables decision makers to make up their minds and stop considering new information, whereas moderate information is unlikely to trigger a decision. Furthermore, groups of decision makers will generate extremists -- individuals who hold strong views despite being uninformed and impulsive. In re-analyses of seven previous empirical studies on both perceptual and preferential choice, we show that both polarization and extremism manifest across a wide variety of choice paradigms. We conclude by offering theoretically-motivated interventions that could reduce polarization and extremism by altering the incentives people have when gathering information.

scholarly journals Polarization and extremism emerge from rational choice: Estimation as a solution to biased sampling

2021 ◽  
Author(s):  
Peter D. Kvam ◽  
Abhay Alaukik ◽  
Callie E. Mims ◽  
Arina Martemyanova ◽  
Matthew Baldwin
Keyword(s):  
Rational Choice ◽  
Information Search ◽  
Empirical Studies ◽  
Decision Makers ◽  
Degree Of Polarization ◽  
Biased Sampling ◽  
Preferential Choice ◽  
New Information ◽  
The Difference ◽  
Decision Efficiency

Polarization is often described as the product of biased information search, motivated reasoning, or other psychological biases. However, polarization and extremism can still occur in the absence of any bias or irrational thinking. In this paper, we show that polarization occurs among groups of decision makers who are implementing rational choice strategies that maximize decision efficiency. This occurs because extreme information enables decision makers to make up their minds and stop considering new information, whereas moderate information is unlikely to trigger a decision and is thus under-represented in the information decision-makers collect. Furthermore, groups of decision makers will generate extremists -- individuals who hold strong views despite being uninformed and impulsive. In re-analyses of seven empirical studies spanning perceptual and preferential choice and a new study examining politically and affectively charged decisions, we show that both polarization and extremism manifest when decision makers gather information to make a choice. Polarization did not occur, however, when participants made an inference about the difference between two quantities as opposed to deciding which one is superior. Estimation therefore offers a theoretically-motivated intervention that can increase the amount of information people consider and reduce the degree of polarization and extremism among groups of individuals.

scholarly journals Keeping a cool head at all times. What determines choice consistency?

2020 ◽  
Author(s):  
Felix Jan Nitsch ◽  
Tobias Kalenscher
Keyword(s):  
Empirical Work ◽  
Neurological Status ◽  
Decision Makers ◽  
Expected Returns ◽  
Current State ◽  
Subjective Value ◽  
Choice Consistency ◽  
Blood Alcohol Levels ◽  
Rational Choice Theories ◽  
Trait Factors

Many rational choice theories posit that rational decision makers assign subjective values to all available choice options and choose the option with highest subjective value. Choice options are usually composed of multiple attributes, e.g. healthiness and taste in dietary choice or risk and expected returns in financial choice. These attributes have to be integrated into a single subjective value. Subjective value maximizing choice requires choice consistency, i.e. consistent weighing of the choice attributes across choices. However, empirical work suggests that perfect choice consistency is often violated, for example when decision makers weigh choice attributes differently across multiple decisions. Some researchers propose to extend certain bounds of rationality or to abandon the concept of rationality as adherence to consistency principles altogether. A more conservative stance assumes that perfect consistency can be violated by decision makers in practice, but that consistency principles still can explain large parts of behavior. In a review of the recent literature, we identify factors for compromised consistency relative to baseline conditions. Broadly, we distinguish between undynamic trait factors and fluid state factors. We find evidence for an influence of age, education, intelligence, and neurological status. In contrast, choice consistency appears to be relatively robust to the influence of sex, personality traits, cognitive load, sleepiness and blood alcohol levels. We conclude, that, according to the current state of the literature, only fundamental differences in decision makers, that is, trait differences, have a significant impact on choice consistency.

…… and How Much for Your Grandmother?

1974 ◽  
Vol 6 (6) ◽  
pp. 619-626 ◽  
Author(s):  
J G U Adams
Keyword(s):  
Recent Progress ◽  
Social Problems ◽  
Human Life ◽  
Decision Makers ◽  
Rational Calculation

Environmental planners frequently make decisions about projects which cost lives. The rational calculation of the optimal sacrifice of human life requires that such lives be made commensurate with all other factors relevant to the project under consideration. The measure most favoured by decision makers in charge of complex social problems is cash. This paper discusses the significance of recent progress toward the discovery of the correct cash value of human life.

Conclusion, 11 Concluding Remarks on the Theoretical, Legal, and Practical Challenges of European Antitrust Criminalization

2014 ◽  
Author(s):  
Whelan Peter
Keyword(s):  
Risk Aversion ◽  
Empirical Evidence ◽  
Cultural Sensitivity ◽  
Information Exchange ◽  
Quantitative Research ◽  
Empirical Studies ◽  
Deterrence Theory ◽  
Eu Member States ◽  
Research Questions ◽  
Rationality Assumption

This concluding chapter provides final remarks on the theoretical, legal, and practical challenges of European antitrust criminalization. It also determines five different research questions that should be addressed by future researchers. First, more detailed, reliable empirical evidence on the motivations of cartelists and whether or not they act in accordance with the rationality assumption of deterrence theory is required. Second, detailed qualitative and quantitative research concerning the usefulness of information exchange within the European Competition Network (ECN) would also be useful. Third, empirical evidence should be generated concerning whether consumers actually assume that their suppliers are not engaged in cartel activity with their competitors. Fourth, empirical studies on the extent to which risk aversion is a characteristic of corporate entities need to be pursued. Finally, empirical evidence on the cultural sensitivity of perceptions of cartel activity among the citizens of the different EU Member States would be welcome.

scholarly journals Dynamic Incentive-Aware Learning: Robust Pricing in Contextual Auctions

2020 ◽  
Author(s):  
Negin Golrezaei ◽  
Adel Javanmard ◽  
Vahab Mirrokni
Keyword(s):  
Decision Maker ◽  
Strategic Behavior ◽  
Learning Algorithm ◽  
Online Advertising ◽  
Ground Truth ◽  
Decision Makers ◽  
Effective Learning ◽  
Reserve Prices ◽  
Feedback Data ◽  
Over Time

In many practical settings, the decision makers have to learn their best actions by experimenting with possible options and collecting feedback (data) over time. It is often assumed that the collected data can be trusted as they reflect the ground truth. But this assumption is violated when the data are generated by strategic players. Consider online advertising market in which the ad exchange (decision maker) aims at learning the best reserve prices in the repeated auctions. In this setting, the data are advertisers’ submitted bids. Such data can be strategically corrupted by advertisers to trick the learning algorithm of the ad exchange to offer them lower reserve prices in the future auctions. In “Dynamic Incentive-Aware Learning: Robust Pricing in Contextual Auctions,” N. Golrezaei, A. Javanmard, and V. Mirrokni design effective learning algorithms with sublinear regret in such environments that are robust to the strategic behavior of the players.

scholarly journals “Economic Correctness” and Agricultural Economics

1993 ◽  
Vol 25 (1) ◽  
pp. 1-13 ◽  
Author(s):  
Ralph D. Christy
Keyword(s):  
Private Sector ◽  
Policy Analysis ◽  
Strategic Behavior ◽  
Agricultural Economics ◽  
Decision Makers ◽  
Competitive Markets ◽  
Imperfectly Competitive ◽  
Private And Public ◽  
Public Decision

AbstractThis address is directed toward applied economists as they provide information to private and public decision makers. Central to this discussion is the role of markets as institutions in achieving society's desired ends. Current “economic correctness”–the view that unfettered markets are superior in achieving efficiency, growth, and welfare-has attempted to return a larger role to the private sector, but the relative roles of market-oriented versus government-oriented solutions to problems are often not well appraised. Views presented herein calls for agricultural economists to move simultaneously toward an understanding of the strategic behavior of firms in imperfectly competitive markets and toward an adoption of policy analysis consistent with a socially complex and globally integrated economy.

Tariff structures for water and sanitation urban households: a primer

Water Policy ◽  
2015 ◽  
Vol 17 (6) ◽  
pp. 1108-1126 ◽  
Author(s):  
F. Silva Pinto ◽  
R. Cunha Marques
Keyword(s):  
Empirical Studies ◽  
Literature Survey ◽  
Decision Makers ◽  
Management Tool ◽  
Demand And Supply ◽  
Urban Households ◽  
Trade Offs ◽  
Setting Process ◽  
Conflicting Objectives ◽  
Tariff Structures

Water tariffs are a powerful management tool. Indeed, they can be seen as a conceptually simple way to promote multiple, possibly conflicting, objectives. Those trade-offs cause discrepancies between stakeholders and may produce undesirable results. The residential urban domain is particularly sensible to those predicaments. To shed some light on the matter, this paper carries out a literature survey on empirical studies, with emphasis on different tariff structures. In total, 185 publications were identified concerning the importance of tariff structures in achieving specific local objectives, or perspectives, of those who demand and supply water. These studies examine, occasionally comparing: (1) the degree to which specific objectives are achieved; (2) how the desired outcomes of a particular structure depend on the customers' sensitivity when receiving a price signal; and (3) the drivers of the decision-makers in the tariff-setting process. A major result is the empirical evidence that the way prices are used matters almost as much as whether they are used or not.

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