scholarly journals Regimes of Expectations: An Active Inference Model of Social Conformity and Human Decision Making

2019 ◽  
Vol 10 ◽  
Author(s):  
Axel Constant ◽  
Maxwell J. D. Ramstead ◽  
Samuel P. L. Veissière ◽  
Karl Friston
2019 ◽  
Vol 30 (4) ◽  
pp. 411-421
Author(s):  
Mehmet Bayram ◽  
Muzaffer Akat

Financial pricing and prediction of stock markets is a specific and relatively narrow field, which have been mainly explored by mathematicians, economists and financial engineers. Prediction with the purpose of making profits in a martingale domain is a hard task. Pairs trading, a market neutral arbitrage strategy, attempts to resolve the drawback of unpredictability and yield market independent returns using relative pricing idea. If two securities have similar characteristics, so should their prices. Deviation from the acceptable similarity range in prices is considered an anomaly, and whenever noticed, trading is executed assuming the anomaly will correct itself.This work proposes a fuzzy inference model for the market-neutral pairs trading strategy. Fuzzy logic lets mimicking human decision-making in a complex trading environment and taking advantage of arbitrage opportunities that the crisp models may miss to acquire for the trade decision-making. Spread between two co-integrated stocks and volatility of the spread is used as decision-making inputs. Spread is a measure of the distance between two stocks and volatility is an indicator of how soon the spread would disappear. We conclude that fuzzy engine contributes to the profitability and efficiency of pairs trading type of strategies.


2020 ◽  
Author(s):  
Natalie Rens ◽  
Philipp Schwartenbeck ◽  
Ross Cunnington ◽  
Giovanni Pezzulo

The freedom to choose between options is strongly linked to notions of free will. Accordingly, several studies have shown that individuals demonstrate a preference for choice, or the availability of multiple options, over and above utilitarian value. Yet we lack a decision-making framework that integrates preference for choice with traditional utility maximisation in free choice behaviour. Here we test the predictions of an active inference model of decision-making in which an agent actively seeks states yielding entropy (availability of options) in addition to utility (economic reward). We designed a study in which participants freely navigated a virtual environment consisting of two consecutive choices leading to reward locations in separate rooms. Critically, the choice of one room always led to two final doors while, in the second room, only one door was permissible to choose. This design allowed us to separately determine the influence of utility and entropy on participants' choice behaviour and their self-evaluation of free will. We found that choice behaviour was better predicted by an inference-based model than by expected utility alone, and that both the availability of options and the value of the context positively influenced participants' perceived freedom of choice. Moreover, this consideration of options was apparent in the ongoing motion dynamics as individuals navigated the environment. These results show that free choice behaviour is well explained by an inference-based framework in which both utility and entropy are optimised.


2013 ◽  
Author(s):  
Scott D. Brown ◽  
Pete Cassey ◽  
Andrew Heathcote ◽  
Roger Ratcliff

2019 ◽  
Vol 63 (1) ◽  
pp. 105-116
Author(s):  
Mark W. Hamilton

Abstract The dual endings of Hosea promoted reflection on Israel’s history as the movement from destruction to restoration based on Yhwh’s gracious decision for Israel. It thus clarifies the endings of the prior sections of the book (chs. 3 and 11) by locating Israel’s future in the realm of Yhwh’s activities. The final ending (14:10) balances the theme of divine agency in 14:2–9 with the recognition of human decision-making and moral formation as aspects of history as well. The endings of Hosea thus offer a good example of metahistoriography, a text that uses non-historiographic techniques to speak of the movements of history.


2012 ◽  
Author(s):  
Paolo Grigolini ◽  
Bruce J. West

Author(s):  
Nelson Mauro Maldonato ◽  
Alessandro Chiodi ◽  
Donatella di Corrado ◽  
Antonietta M. Esposito ◽  
Salvatore de Lucia ◽  
...  

Author(s):  
Asuka Kaneko ◽  
Yui Asaoka ◽  
Young-A Lee ◽  
Yukiori Goto

Abstract Background Decision-making and judgments in our social activities often erroneous and irrational, known as social biases. However, cognitive and affective processes that produce such biases remain largely unknown. In this study, we investigated associations between social schemas, such as social judgment and conformity, entailing social biases and psychological measurements relevant to cognitive and affective functions. Method Forty-two healthy adult subjects were recruited in this study. A psychological test and a questionnaire were administered to assess biased social judgements by superficial attributes and social conformity by adherence to social norms, respectively, along with additional questionnaires and psychological tests for cognitive and affective measurements, including negative affects, autistic traits, and Theory of Mind (ToM). Associations of social judgment and conformity with cognitive and affective functions were examined multiple regression analysis and structural equation modeling. Results Anxiety and the cognitive realm of ToM were mutually associated with both social judgments and conformity, although social judgements and conformity were still independent processes with each other. Social judgements were also associated with autistic traits and the affective realm of ToM, whereas social conformity was associated with negative affects other than anxiety and intuitive decision-making style. Conclusions These results suggest that ToM and negative affects may play important roles in social judgements and conformity, and social biases connoted in these social schemas.


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