Both economists and psychologists are interested in understanding decision making under uncertainty. Yet, they rely on different concepts to analyse human behaviour: economists use economic preference parameters rooted in utility theory, while psychologists use personality traits to describe responses to uncertain situations. Using a large sample of university students, this study examines and contrasts five economic preference parameters and six psychological personality traits that are commonly used to study individuals’ attitudes towards uncertainty. A novelty of this paper is including both (...) the economic concept of ambiguity aversion as well as the personality trait of ambiguity intolerance. We find that standard economic preference measures based on incentivized choice tasks seem to capture rather different characteristics than psychological personality traits. In contrast, economic preference measures obtained from self-assessment questions appear more related to personality traits, especially ambiguity intolerance. (shrink)

Canonical economic agents act so as to maximize a single, representative, utility function. However, there is accumulating evidence that heterogeneity in thought processes may be an important determinant of individual behavior. This paper investigates the implications of a vector-valued generalization of the Expected Utility paradigm, which permits agents either to deliberate as per Homo economics, or to act impulsively. This generalized decision theory is applied to explain the crowding-out effect, irrational educational investment decisions, persistent social inequalities, the pervasive influence (...) of non-cognitive ability on socio-economic outcomes, and the dynamic relationships between non-cognitive ability, cognitive ability, and behavioral biases. These results suggest that the generalized decision theory warrants further investigation. (shrink)

In this paper, we provide a detailed review of previous classifications of 2 × 2 games and suggest a mathematically simple way to classify the symmetric 2 × 2 games based on a decomposition of the payoff matrix into a cooperative and a zero-sum part. We argue that differences in the interaction between the parts is what makes games interesting in different ways. Our claim is supported by evolutionary computer experiments and findings in previous literature. In addition, we provide a (...) method for using a stereographic projection to create a compact 2-d representation of the game space. (shrink)

This study analyses the sensitivity of public goods contributions through the lens of psychological motives. We report the results of a public goods experiment in which subjects were induced with the motives of care and anger through autobiographical recall. Subjects’ preferences, beliefs, and perceptions under each motive are compared with those of subjects experiencing a neutral autobiographical recall control condition. We find, but only for those subjects with the highest comprehension of the game, that care elicits significantly higher contributions (...) than anger, with the control treatment in between. This positive influence of the care motive on unconditional giving is accounted for partly by preferences for giving and partly by beliefs concerning greater contributions by others. Anger also affects attention to own and other’s payoffs and perceptions of the game’s incentive structure. (shrink)

We generalize the concept of a cooperative non-transferable utility game by introducing a socially structured game. In a socially structured game every coalition of players can organize themselves according to one or more internal organizations to generate payoffs. Each admissible internal organization on a coalition yields a set of payoffs attainable by the members of this coalition. The strengths of the players within an internal organization depend on the structure of the internal organization and are represented by (...) an exogenously given power vector. More powerful players have the power to take away payoffs of the less powerful players as long as those latter players are not able to guarantee their payoffs by forming a different internal organization within some coalition in which they have more power.We introduce the socially stable core as a solution concept that contains those payoffs that are both stable in an economic sense, i.e., belong to the core of the underlying cooperative game, and stable in a social sense, i.e., payoffs are sustained by a collection of internal organizations of coalitions for which power is distributed over all players in a balanced way. The socially stable core is a subset and therefore a refinement of the core. We show by means of examples that in many cases the socially stable core is a very small subset of the core.We will state conditions for which the socially stable core is non-empty. In order to derive this result, we formulate a new intersection theorem that generalizes the KKMS intersection theorem. We also discuss the relationship between social stability and the wellknown concept of balancedness for NTU-games, a sufficient condition for non-emptiness of the core. In particular we give an example of a socially structured game that satisfies social stability and therefore has a non-empty core, but whose induced NTU-game does not satisfy balancedness in the general sense of Billera. (shrink)

In experimental economics one can confront a “don’t!”, as in “do not deceive your participants!”, as well as a “do!”, as in “incentivize choice making!”. Neither exists in experimental psychology. Further controversies exist in data collection methods, e.g., play strategy (vector) method in game experiments, and how to guarantee external and internal validity by describing experimental scenarios by field-related vignettes or by abstract, often formal, rules as it is used in decision and game theory. We emphasize that differences (...) between the experimental methodology of the two disciplines are minor rather than substantial and suggest that such differences should be resolved, as much as possible, through empirical research. Rather than focusing on familiar debates, we suggest to substitute the revealed-motive approach in experimental economics by designs whose data not only inform about choice, but also about the reasoning dynamics. (shrink)

Psychological observations are by now well integrated into economics, especially in the theory of finance, as can also be seen in the Nobel Prize awarded to Thaler. On the contrary, Simon’s attempt to reforge economic theory on the paradigm of bounded rationality failed. Starting from the birth of the neoclassical paradigm, we’ll describe the attempt to give it psychological foundations with a direct measurement of utility, then the axiomatic turn of the paradigm and its first anomalies. We’ll then sum up (...) the debate on rationality, taking place in the group of economists led by Simon, which brought to the rational expectations hypothesis. Finally, we’ll discuss the development of behavioral economics and its progressive acceptance in economic theory. This historical reconstruction allows us to understand the actual hard core of the neoclassical paradigm and the growing need of the paradigm for practical flexibility that determines how to choose arguments, methods and evidence that can be useful to its development, including psychological ones. (shrink)

While game theory has been transformative for decision making, the assumptions made can be overly restrictive in certain instances. In this work, we investigate some of the underlying assumptions of rationality, such as mutual consistency and best response, and consider ways to relax these assumptions using concepts from level-k reasoning and quantal response equilibrium (QRE) respectively. Specifically, we propose an information-theoretic two-parameter model called the quantal hierarchy model, which can relax both mutual consistency and best response while still approximating (...) level-k, QRE, or typical Nash equilibrium behavior in the limiting cases. The model is based on a recursive form of the variational free energy principle, representing higher-order reasoning as (pseudo) sequential decision-making in extensive-form game tree. This representation enables us to treat simultaneous games in a similar manner to sequential games, where reasoning resources deplete throughout the game-tree. Bounds in player processing abilities are captured as information costs, where future branches of reasoning are discounted, implying a hierarchy of players where lower-level players have fewer processing resources. We demonstrate the effectiveness of the quantal hierarchy model in several canonical economic games, both simultaneous and sequential, using out-of-sample modelling. (shrink)

Value-sensitive design theorists propose that a range of values that should inform how future social robots are engineered. This article explores a new value: digital well-being, and proposes that the next generation of social robots should be designed to facilitate this value in those who use or come into contact with these machines. To do this, I explore how the morphology of social robots is closely connected to digital well-being. I argue that a key decision is whether (...) social robots are designed as embodied or disembodied. After exploring the merits of both approaches, I conclude that, on balance, there are persuasive reasons why disembodied social robots may well fare better with respect to the value of digital well-being. (shrink)

Accountability is present in many types of social relations; for example, the accountability of elected representatives to voters is the key characteristic of representative democracy. We distinguish between two institutional mechanisms of accountability, i.e., opportunity to punish and requirement of a justification, and examine the separate and combined effects of these mechanisms on individual behavior. For this purpose, we designed a decision-making experiment where subjects engage in a three-player trust game with two senders and one responder. We ask (...) whether holding the responder accountable increases senders’ and responders’ contributions in a trust game. When restricting the analysis to the first round, the requirement of justification seems to have a positive impact on senders’ contributions. When the game is played repeatedly, the experience of previous rounds dominates the results and significant treatment effects are no longer seen. We also find that responders tend to justify their choices in terms of reciprocity, which is in line with observed behavior. Moreover, the treatment combining punishment and justification hinders justifications that appeal to pure self-interest. (shrink)

This article contributes to the debate around the abilities of large language models such as GPT-3, dealing with: firstly, evaluating how well GPT does in the Turing Test, secondly the limits of such models, especially their tendency to generate falsehoods, and thirdly the social consequences of the problems these models have with truth-telling. We start by formalising the recently proposed notion of reversible questions, which Floridi & Chiriatti propose allow one to ‘identify the nature of the source of their (...) answers’, as a probabilistic measure based on Item Response Theory from psychometrics. Following a critical assessment of the methodology which led previous scholars to dismiss GPT’s abilities, we argue against claims that GPT-3 completely lacks semantic ability. Using ideas of compression, priming, distributional semantics and semantic webs we offer our own theory of the limits of large language models like GPT-3, and argue that GPT can competently engage in various semantic tasks. The real reason GPT’s answers seem senseless being that truth-telling is not amongst them. We claim that these kinds of models cannot be forced into producing only true continuation, but rather to maximise their objective function they strategize to be plausible instead of truthful. This, we moreover claim, can hijack our intuitive capacity to evaluate the accuracy of its outputs. Finally, we show how this analysis predicts that a widespread adoption of language generators as tools for writing could result in permanent pollution of our informational ecosystem with massive amounts of very plausible but often untrue texts. (shrink)

This paper has a twofold scope. The first one is to clarify and put in evidence the isomorphic character of two theories developed in quite different fields: on one side, threshold logic, on the other side, simple games. One of the main purposes in both theories is to determine when a simple game is representable as a weighted game, which allows a very compact and easily comprehensible representation. Deep results were found in threshold logic in the sixties and (...) seventies for this problem. However, game theory has taken the lead and some new results have been obtained for the problem in the past two decades. The second and main goal of this paper is to provide some new results on this problem and propose several open questions and conjectures for future research. The results we obtain depend on two significant parameters of the game: the number of types of equivalent players and the number of types of shift-minimal winning coalitions. (shrink)

We examine collective decision-making in a jury voting game under the unanimity rule when voters have ambiguous beliefs. Unlike in existing studies (Ellis in Theoretical Economics 11:865–895, 2016; Fabrizi et al., in: AUT Economics Working Paper, 2021; Ryan in Theory and Decision 90:543–577, 2021), the locus of ambiguity is the likelihood function (signal precision) rather than the prior. This significantly alters the properties of symmetric equilibria. While prior ambiguity may induce multiple equilibria (Fabrizi et al., in: AUT Economics Working (...) Paper, 2021; Ryan in Theory and Decision 90:543–577, 2021) we show that, under likelihood ambiguity, there exists a unique non-trivial symmetric responsive equilibrium that takes the same form as in the absence of ambiguity (Feddersen and Pesendorfer in The American Political Science Review 92:23–35, 1998). Moreover, likelihood ambiguity partially offsets the pernicious effects of pivotality on decision quality: the frequency of Type I error (convicting the innocent) is typically lower than in the absence of ambiguity. (shrink)

Several philosophers have expressed concerns with some recent uses of the term ‘cognition’. Underlying a number of these concerns are claims that cognition is only located in the brain and that no compelling case has been made to use ‘cognition’ in any way other than as a cause of behavior that is representational in nature. These concerns center on two primary misapprehensions: First, that some adherents of dynamical cognitive science think DCS implies the thesis of extended cognition and the rejection (...) of representation, and second, that cognition is mistakenly equated with behavior. We make three points in response to these claims: First, there is no thoroughly entrenched conception of cognition as distinct from behavior that is being illegitimately disregarded. Second, we present Shapiro’s exposition of dynamical systems theory as revealing a misunderstanding of the way that dynamical models are used in explanations of cognition and related phenomena. Accordingly, a proper conception of DCS’s methods facilitates an appreciation of extended cognition as a legitimate phenomenon of scientific investigation. Finally, we demonstrate that practicing cognitive scientists and psychologists are far more pluralistic in the phenomena they apply ‘cognition’ to than is suggested by some. At the heart of our disagreement with these concerned folks is that although we think it likely that some cognitive phenomena are representational, non-extended, and only in-between the ears, we also think there are good conceptual and empirical reasons to believe that many cognitive phenomena are non-representational, extended, and not confined to the brain. (shrink)

This paper examines preferences among uncertain prospects when the decision maker is uneasy about his assignment of subjective probabilities. It proposes a two-stage lottery framework for the analysis of such prospects, where the first stage represents an assessment of the vagueness (ambiguity) in defining the problem's randomness and the second stage represents an assessment of the problem for each hypothesized randomness condition. Standard axioms of rationality are prescribed for each stage, including weak ordering, continuity, and strong independence. The ‘Reduction of (...) Compound Lotteries' axiom is weakened, however, so that the two lottery stages have consistent, but not collapsible, preference structures. The paper derives a representation theorem from the primitive preference axioms, and the theorem asserts that preference-consistent decisions are made as if the decision maker is maximizing a modified expected utility functional. This representation and its implications are compared to alternative decision models. Criteria for assigning the relative empirical power of the alternative models are suggested. (shrink)

This paper presents a very simple model in which situational cues associated with a particular consumption good compel an agent—who may have otherwise been “thinking about” something else—to consider the decision to consume that good. Within this framework, it is shown how an endowment effect and a present bias can arise through a common mechanism. The analysis points to a novel, contributing role for inattention in understanding both of these behavioral anomalies while also speaking to evidence that they are often (...) cue-induced. (shrink)

A situation, in which a finite set of players can obtain certain payoffs by cooperation can be described by a cooperative game with transferable utility, or simply a TU-game. A (point-valued) solution for TU-games assigns a payoff distribution to every TU-game. In this article we discuss a class of equal surplus sharing solutions consisting of all convex combinations of the CIS-value, the ENSC-value and the equal division solution. We provide several characterizations of this class of solutions on (...) variable and fixed player set. Specifications of several properties characterize specific solutions in this class. (shrink)

In this paper, we study solution concepts for cooperative games with stochastic payoffs. we define four kinds of solution concepts, namely the most coalitional (marginal) stable solution and the fairest coalitional (marginal) solution, by minimizing the total variance of excesses of coalitions (individual players). All these four concepts are optimal solutions of corresponding optimal problem under the least square criterion. It turns out that the fairest coalitional (marginal) solution belongs to the set of the most coalitional (marginal) stable solutions. Inspired (...) by the definition of nucleolus, we propose various extended nucleolus based on lexicographic criterion. Furthermore, axiomatizations of the proposed solutions are exhibited through the linkage between the stochastic and deterministic models. (shrink)

Schematic conflict occurs when evidence is interpreted in different ways (for example, by different people, who have learned to approach the given evidence with different schemata). Such conflicts are resolved either by weighting some schemata more heavily than others, or by finding common-ground inferences for several schemata, or by a combination of these two processes. Belief functions, interpreted as representations of evidence strength, provide a natural model for weighting schemata, and can be utilized in several distinct ways to compute common-ground (...) inferences. In two examples, different computations seem to be required for reasonable common-ground inference. In the first, competing scientific theories produce distinct, logically independent inferences based on the same data. In this example, the simple product of the competing belief functions is a plausible evaluation of common ground. In the second example (sensitivity analysis), the conflict is among alternative statistical assumptions. Here, a product of belief functions will not do, but the upper envelope of normalized likelihood functions provides a reasonable definition of common ground. Different inference contexts thus seem to require different methods of conflict resolution. A class of such methods is described, and one characteristic property of this class is proved. (shrink)

Third generation prospect theory is a theory of choices and of judgments of highest buying and lowest selling prices of risky prospects, i.e., of willingness to pay and willingness to accept. The gap between WTP and WTA is sometimes called the “endowment effect” and was previously called the “point of view” effect. Third generation prospect theory combines cumulative prospect theory for risky prospects with the theory that judged values are based on the integration of price paid or price received with (...) the consequences of gambles. In TGPT, the discrepancy between WTP and WTA is due to loss aversion-losses have greater absolute utility than gains of the same value. TGPT was developed independently of similar developments by Birnbaum and Zimmermann :145–187, 1998) and Luce. This paper reviews theoretical and empirical findings, to show that TGPT fails as a descriptive model of both choices and judgments. Evidence refutes three implications of TGPT, but they are consistent with configural weight models in which loss aversion is not needed to describe the results. In the configural weight models, buyers place greater weight on lower consequences, attributes or estimates of value compared to sellers, who place greater configural weight on higher aspects of an object or prospect. (shrink)

The article aims to demonstrate that the nudge theory suffers from three main weaknesses stemming from its theoretical dependence on behavioural economics. The first two weaknesses endanger the paternalistic goal, whereas the third does not justify the libertarian attribute. The first weakness lies in the incomplete realistic characterisation of behavioural economics theory that is the central theoretical pillar of Nudge theory. The second weakness is even more relevant. The normative model of behavioural economics is neoclassical rationality. It can be applied (...) to choices in conditions of risk, when it is possible to forecast the probability of the outcomes of one’s choices. On the contrary the real life problems are inside a complex and uncertain environment. In an uncertain environment the neoclassical algorithms are no longer valid, in that they postulate the knowledge of the probability of the outputs. Thus errors and bias, as observed in behavioural economics, are not such in many instances, but they are instead adaptive and therefore rational responses to the context of decision-making. Therefore nudge theory that pursues the normative paternalistic objective of neutralising the bias and judgement errors discovered by behavioural economics and putting paternalistically the citizen on the right track, is in fact proceeding in the wrong direction. The last weakness concerns an assumption of Nudge theory about the duality of mind. System 1 represents the intuitive mind, while System 2 corresponds to the analytical one. System 1 tends to make decisions quickly and unconsciously, while System 2 follows a slow and conscious process. Biases and judgement errors are mainly generated by System 1. However, System 2 may later intervene to correct them. From this premise, the Nudge theory affirms its libertarian character. In this paper I will argue that the dualism of the mind would not entail the reversibility of some nudges, particularly of default states. In this way the fundamental pillar is weakened to justify the libertarian character of the nudge theory. (shrink)

The paper first summarizes the author's decision-theoretical model of moral behavior, in order to compare the moral implications of the act-utilitarian and of the rule-utilitarian versions of utilitarian theory. This model is then applied to three voting examples. It is argued that the moral behavior of act-utilitarian individuals will have the nature of a noncooperative game, played in the extensive mode, and involving action-by-action maximization of social utility by each player. In contrast, the moral behavior of rule-utilitarian individuals (...) will have the nature of a cooperative game, played in the normal mode, and involving a firm commitment by each player to a specific moral strategy (viz. to the strategy selected by the rule-utilitarian choice criterion) — even if some individual actions prescribed by this strategy, when considered in isolation, should fail to maximize social utility. The most important advantage that rule utilitarianism as an ethical theory has over act utilitarianism lies in its ability to give full recognition to the moral and social importance of individual rights and personal obligations. It is easy to verify that action-by-action maximization of social utility, as required by act utilitarianism, would destroy these rights and obligations. In contrast, rule utilitarianism can fully recognize the moral validity of these rights and obligations precisely because of its commitment to an overall moral strategy, independent of action-by-action social-utility maximization. The paper ends with a discussion of the voter's paradox problem. The conventional theory of rational behavior cannot avoid the paradoxical conclusion that, in any large electorate, voting is always an irrational activity because one's own individual vote is extremely unlikely to make any difference to the outcome of any election. But it can be shown that, by using the principles of rule-utilitarian theory, this paradox can easily be resolved and that, in actual fact, voting, even in large electorates, may be perfectly rational action. More generally, the example of rule utilitarianism shows what an important role the concept of a rational commitment can play in the analysis of rational behavior. (shrink)

We propose a method to associate a coalitional interval game with each strategic game. The method is based on the lower and upper values of finite two-person zero-sum games. Associating with a strategic game a coalitional interval game we avoid having to take either a pessimistic or an optimistic approach to the problem. The paper makes two contributions to the literature: It provides a theoretical foundation for the study of coalitional interval games and it also provides, (...) studies, and characterizes a natural method of associating coalitional interval games with strategic games. (shrink)

This volume reflects the ‘philosophy of science in practice’ approach and takes a fresh look at traditional philosophical problems in the context of natural, social, and health research. Inspired by the work of Nancy Cartwright that shows how the practices and apparatuses of science help us to understand science and to build theories in the philosophy of science, this volume critically examines the philosophical concepts of evidence, laws, causation, and models and their roles in the process of scientific reasoning. (...) Each chapter is an important one in the philosophy of science, while the volume as a whole deals with these philosophical concepts in a unified way in the context of actual scientific practice. This volume thus aims to contribute to this new direction in the philosophy of science.​. (shrink)

Statistical learning theory is often associated with the principle of Occam’s razor, which recommends a simplicity preference in inductive inference. This paper distills the core argument for simplicity obtainable from statistical learning theory, built on the theory’s central learning guarantee for the method of empirical risk minimization. This core “means-ends” argument is that a simpler hypothesis class or inductive model is better because it has better learning guarantees; however, these guarantees are model-relative and so the theoretical push towards simplicity is (...) checked by our prior knowledge. (shrink)

The principle of differential marginality (Casajus in Theory and Decis 71(2):163-–174) for cooperative games is a very appealing property that requires equal productivity differentials to translate into equal payoff differentials. In this paper we apply this property to axiomatic characterizations of values. We show that differential marginality implies additivity and symmetry under certain conditions. Based on this result, we propose new characterizations of the equal division and the equal surplus division values. Finally, we characterize two classes of convex combinations of (...) values, i.e., α\documentclass[12pt]{minimal} \usepackage{amsmath} \usepackage{wasysym} \usepackage{amsfonts} \usepackage{amssymb} \usepackage{amsbsy} \usepackage{mathrsfs} \usepackage{upgreek} \setlength{\oddsidemargin}{-69pt} \begin{document}$$\alpha$$\end{document}-egalitarian Shapley values and α\documentclass[12pt]{minimal} \usepackage{amsmath} \usepackage{wasysym} \usepackage{amsfonts} \usepackage{amssymb} \usepackage{amsbsy} \usepackage{mathrsfs} \usepackage{upgreek} \setlength{\oddsidemargin}{-69pt} \begin{document}$$\alpha$$\end{document}-equal surplus division values, by employing differential marginality and establishing the uniqueness of these values on inessential games. (shrink)

Necessity and sufficiency are the building blocks of all successful explanations. Yet despite their importance, these notions have been conceptually underdeveloped and inconsistently applied in explainable artificial intelligence, a fast-growing research area that is so far lacking in firm theoretical foundations. In this article, an expanded version of a paper originally presented at the 37th Conference on Uncertainty in Artificial Intelligence, we attempt to fill this gap. Building on work in logic, probability, and causality, we establish the central role of (...) necessity and sufficiency in XAI, unifying seemingly disparate methods in a single formal framework. We propose a novel formulation of these concepts, and demonstrate its advantages over leading alternatives. We present a sound and complete algorithm for computing explanatory factors with respect to a given context and set of agentive preferences, allowing users to identify necessary and sufficient conditions for desired outcomes at minimal cost. Experiments on real and simulated data confirm our method’s competitive performance against state of the art XAI tools on a diverse array of tasks. (shrink)

Scientificity is essentially methodology. The use of information technology as methodological instruments in science has been increasing for decades, this raises the question: Does this transform science? This question is the subject of the Special Issue in Minds and Machines “The epistemological significance of methods in computer simulation and machine learning”. We show that there is a technological change in this area that has three methodological and epistemic consequences: methodological opacity, reproducibility issues, and altered forms of justification.

This paper experimentally studies the relationship between happiness, attention and time perception. The experimental results challenge the prevailing results in the economic and psychological literature. A Go/No-Go test reveals a clear negative correlation between happiness and attention: the subject who is happier is also more inattentive, probably because of his or her state of lightheartedness, a state of mind that seems to negatively affect performance. Furthermore, the fact that happier subjects evaluate the passage of time with different objective and subjective (...) measures opens up paths of further research in assessing a new feature of happiness. (shrink)

This paper constructs a simple model of decision-making that accounts for the paradoxes of Ellsberg and Machina. It does so by representing decision makers’ beliefs on the vector space $${\mathbb{R}}\times {\mathbb{R}}$$ R × R and by providing a reasonable decision rule with axiomatic foundations. Moreover, the model allows for a characterization that clearly distinguishes between the two paradoxes. The interesting feature of the paper is that the ‘resolution’ of the paradoxes is along the lines suggested by the eponymous authors themselves. (...) This is to say, the decision rule derived from the axioms corresponds to Ellsberg’s own rule in the narrow set of circumstances that he explored, and the decision rule embodies Machina’s injunction that we treat choice under uncertainty in a similar manner to the way we treat standard consumer theory. That the paper cleaves to the advice of both authors is a little surprising given that it utilizes a two-dimensional vector space that neither author deployed. (shrink)

The theoretical literature on vertical relationships usually assumes that beliefs about secret contracts take specific forms. In a recent paper, Eguia et al. (Games Econ Behav 109:465–483,2018) propose a new selection criterion that does not impose any restriction on beliefs. In this article, we extend their criterion by generalizing it to risk-averse retailers, and we show that risk aversion modifies the size of the belief subsets that support each equilibrium. We conduct an experiment which revisits that of Eguia et al. (...) (Games Econ Behav 109:465–483,2018). We design a new treatment effect on equilibrium selection depending on the retailers’ risk sensitivity. Experimental results confirm the treatment effect: the more sensitivity there is towards risk, the more the equilibrium played is consistent with passive beliefs. In addition, extending Eguia et al.’s (Games Econ Behav 109:465–483,2018) criterion to risk-averse retailers improves its predictive power on the equilibria played, especially for a population of retailers with moderate to extreme risk aversion. (shrink)

The article discusses the process of “conceptual borrowing”, according to which, when a new discipline emerges, it develops its technical vocabulary also by appropriating terms from other neighbouring disciplines. The phenomenon is likened to Carl Schmitt’s observation that modern political concepts have theological roots. The authors argue that, through extensive conceptual borrowing, AI has ended up describing computers anthropomorphically, as computational brains with psychological properties, while brain and cognitive sciences have ended up describing brains and minds computationally and informationally, (...) as biological computers. The crosswiring between the technical languages of these disciplines is not merely metaphorical but can lead to confusion, and damaging assumptions and consequences. The article ends on an optimistic note about the self-adjusting nature of technical meanings in language and the ability to leave misleading conceptual baggage behind when confronted with advancement in understanding and factual knowledge. (shrink)

Scientific theories of consciousness identify its contents with the spatiotemporal structure of neural population activity. We follow up on this approach by stating and motivating Dynamical Emergence Theory, which defines the amount and structure of experience in terms of the intrinsic topology and geometry of a physical system’s collective dynamics. Specifically, we posit that distinct perceptual states correspond to coarse-grained macrostates reflecting an optimal partitioning of the system’s state space—a notion that aligns with several ideas and results from computational neuroscience (...) and cognitive psychology. We relate DET to existing work, offer predictions for empirical studies, and outline future research directions. (shrink)

Machine learning-based AI algorithms lack transparency. In this article, I offer an interpretation of AI’s explainability problem and highlight its ethical saliency. I try to make the case for the legal enforcement of a strong explainability requirement: human organizations which decide to automate decision-making should be legally obliged to demonstrate the capacity to explain and justify the algorithmic decisions that have an impact on the wellbeing, rights, and opportunities of those affected by the decisions. This legal duty can be derived (...) from the demands of Rawlsian public reason. In the second part of the paper, I try to show that the argument from the limitations of human cognition fails to get AI off the hook of public reason. Against a growing trend in AI ethics, my main argument is that the analogy between human minds and artificial neural networks fails because it suffers from an atomistic bias which makes it blind to the social and institutional dimension of human reasoning processes. I suggest that developing interpretive AI algorithms is not the only possible answer to the explainability problem; social and institutional answers are also available and in many cases more trustworthy than techno-scientific ones. (shrink)

This paper explores aspects of GPT-3 that have been discussed as harbingers of artificial general intelligence and, in particular, linguistic intelligence. After introducing key features of GPT-3 and assessing its performance in the light of the conversational standards set by Alan Turing in his seminal paper from 1950, the paper elucidates the difference between clever automation and genuine linguistic intelligence. A central theme of this discussion on genuine conversational intelligence is that members of a linguistic community never merely respond “algorithmically” (...) to queries through a selective kind of pattern recognition, because they must also jointly attend and act with other speakers in order to count as genuinely intelligent and trustworthy. This presents a challenge for systems like GPT-3, because representing the world in a way that makes conversational common ground salient is an essentially collective task that we can only achieve jointly with other speakers. Thus, the main difficulty for any artificially intelligent model of conversation is to account for the communicational intentions and motivations of a speaker through joint attention. These joint motivations and intentions seem to be completely absent from the standard way in which systems like GPT-3 and other artificial intelligent systems work. This is not merely a theoretical issue. Since GPT-3 and future iterations of similar systems will likely be available for commercial use through application programming interfaces, caution is needed regarding the risks created by these systems, which pass for “intelligent” but have no genuine communicational intentions, and can thereby produce fake and unreliable linguistic exchanges. (shrink)

This paper provides evidence for the following novel insights: (1) People’s economic decisions depend on their psychological motives, which are shaped predictably by the social context. (2) In particular, the social context influences people’s other-regarding preferences, their beliefs and their perceptions. (3) The influence of the social context on psychological motives can be measured experimentally by priming two antagonistic motives—care and anger—in one player towards another by means of an observance or a violation of a fairness norm. (...) Using a mediation approach, we find that the care motive leads to higher levels of cooperation which are driven by more optimistic beliefs, a different perception of the game as well as by a shift towards more pro-social preferences. (shrink)

This paper develops a model of individual decision-making under bounded rationality in which discretionary cognitive adjustment creates a durable stock that complements choice of action. While it increases utility, adjustment also entails a cost, because focusing attention optimally is effortful and mental resources are scarce. Associated behavioral phenomena are categorized based on whether the operative motivation in adjusting is forward-looking utility maximization or justification of prior action. The theory is in line with prior conceptions of cognitive dissonance, but also offers (...) a more empirically consistent explanation of the endowment effect, persuasive advertising, and sunk-cost effects than existing accounts. (shrink)

Economics bases the choice theory on the mental experiment that introduces the choice correspondence, which associates to every set of possible actions the subset of preferred actions. If some conditions are satisfied, then the choice correspondence implies a binary preference ordering on actions and an ordinal utility function. This approach applies both to decisions under certainty and decisions under uncertainty. The preference ordering depends on the consequence of actions. Under certainty, there is only one consequence to every action, while, under (...) uncertainty, many consequences are possible, associated with the states of the world. These consequences are represented by the action itself, the states of the world, and the corresponding outcomes. Current theories consider only outcomes, but some theories include state dependent preference. Preference for the action itself is not considered, but it might be relevant. The rationality of the theory is a different question from the rationality of the decision-maker. Moreover, the rationality of the theory may imply the rationality of a preference ordering, but this does not require the rationality of the decision-maker. It is only assumed that he/she behaves according to the calculation made by the theorist. The rationality of the preference ordering requires the rationality of the preference on outcomes, of the expectations on the events, and of their connection with the preference ordering on actions. The normative relevance of rational preferences is removed by the introduction of many alternative rational theories, which justify contrasting behaviors in identical situations. (shrink)

We situate the debate on intentionality within the rise of cognitive neuroscience and argue that cognitive neuroscience can explain intentionality. We discuss the explanatory significance of ascribing intentionality to representations. At first, we focus on views that attempt to render such ascriptions naturalistic by construing them in a deflationary or merely pragmatic way. We then contrast these views with staunchly realist views that attempt to naturalize intentionality by developing theories of content for representations in terms of information and biological function. (...) We echo several other philosophers by arguing that these theories over-generalize unless they are constrained by a theory of the functional role of representational vehicles. This leads to a discussion of the functional roles of representations, and how representations might be realized in the brain. We argue that there’s work to be done to identify a distinctively mental kind of representation. We close by sketching a way forward for the project of naturalizing intentionality. This will not be achieved simply by ascribing the content of mental states to generic neural representations, but by identifying specific neural representations that explain the puzzling intentional properties of mental states. (shrink)

This volume reflects the ‘philosophy of science in practice’ approach and takes a fresh look at traditional philosophical problems in the context of natural, social, and health research. Inspired by the work of Nancy Cartwright that shows how the practices and apparatuses of science help us to understand science and to build theories in the philosophy of science, this volume critically examines the philosophical concepts of evidence, laws, causation, and models and their roles in the process of scientific reasoning. (...) Each chapter is an important one in the philosophy of science, while the volume as a whole deals with these philosophical concepts in a unified way in the context of actual scientific practice. This volume thus aims to contribute to this new direction in the philosophy of science.​. (shrink)

Brams’ paradox of new members and Shenoy’s paradox of smaller coalitions are, in a sense, equivalent. They are both implied by the monotonicity of a power index: while the first is exhibited on every simple game that is not strong, the latter can be observed on every simple game in which players are not almost symmetric. For the Shapley–Shubik index, this symmetry condition is not only necessary but also sufficient to avoid the paradox of smaller coalitions.

This paper experimentally investigates the altruistic behavior of physicians and whether this behavior is affected by payment system and uncertainty in health outcome. Subjects in the experiment take on the role of physicians and decide on the provision of medical care for different types of patients, who are identical in all respects other than the degree to which a given level of medical treatment affects their health. We investigate physician altruism from the perspective of ethical principles, by categorizing physicians according (...) to how well their treatment decisions align with different principles for priority setting. The experiment shows that many physicians are altruistic toward their patients but also that the degree of altruism varies across patients with different medical needs. We find a strong effect of payment system that is overall unaffected by the introduction of risk and ambiguity in patients health outcomes. There is, however, substantial heterogeneity across individuals, in particular under the capitation payment system where physicians responses to the introduction of uncertainty in patient health are modulated by their own generic risk and ambiguity preferences. (shrink)

The Battle of the Sexes game, which captures both coordination and conflict problems, has been applied to a wide range of situations. We show that, by reducing distributional conflict and enhancing coordination, turn taking supported by a “turn taking with independent randomizations” strategy allows players to engage in intertemporal sharing of the gain from cooperation. Using this insight, we decompose the benefit from turn taking into conflict-mitigating and coordination-enhancing components. Our analysis suggests that an equilibrium measure of the “degree (...) of intertemporal conflict” provides an intuitive way to understand the sources of welfare gain from turn taking in the repeated Battle of the Sexes game. We find that when this equilibrium measure is lower, players behave less aggressively and the welfare gain from turn taking is higher. (shrink)

A widespread need to explain the behavior and outcomes of AI-based systems has emerged, due to their ubiquitous presence. Thus, providing renewed momentum to the relatively new research area of eXplainable AI (XAI). Nowadays, the importance of XAI lies in the fact that the increasing control transference to this kind of system for decision making -or, at least, its use for assisting executive stakeholders- already affects many sensitive realms (as in Politics, Social Sciences, or Law). The decision-making power (...) handover to opaque AI systems makes mandatory explaining those, primarily in application scenarios where the stakeholders are unaware of both the high technology applied and the basic principles governing the technological solutions. The issue should not be reduced to a merely technical problem; the explainer would be compelled to transmit richer knowledge about the system (including its role within the informational ecosystem where he/she works). To achieve such an aim, the explainer could exploit, if necessary, practices from other scientific and humanistic areas. The first aim of the paper is to emphasize and justify the need for a multidisciplinary approach that is beneficiated from part of the scientific and philosophical corpus on Explaining, underscoring the particular nuances of the issue within the field of Data Science. The second objective is to develop some arguments justifying the authors’ bet by a more relevant role of ideas inspired by, on the one hand, formal techniques from Knowledge Representation and Reasoning, and on the other hand, the modeling of human reasoning when facing the explanation. This way, explaining modeling practices would seek a sound balance between the pure technical justification and the explainer-explainee agreement. (shrink)

This article discusses the set of Harsanyi payoff vectors of a cooperative TU-game, also known as the Selectope. We reconsider some results on Harsanyi payoff vectors within a more general framework. First, an intuitive approach is used, showing that the set of Harsanyi payoff vectors is the core of an associated convex game. Next, the set of individual rational Harsanyi payoff vectors, the Harsanyi imputations in short, is considered. Existence conditions are provided, and if non-empty, we provide a (...) description as the core of a well-defined convex game, and show that it is an externally stable set. (shrink)

The goal of this research is to understand the interaction of implicit and explicit psychological processes in dealing with emotional distractions and meta-cognitive control of such distractions. The questions are how emotional and meta-cognitive processes can be separated into implicit and explicit components, and how such a separation can be utilized to improve self-regulation of emotion, which can have significant theoretical and practical implications.

This paper presents four theorems that connect continuity postulates in mathematical economics to solvability axioms in mathematical psychology, and ranks them under alternative supplementary assumptions. Theorem 1 connects notions of continuity (full, separate, Wold, weak Wold, Archimedean, mixture) with those of solvability (restricted, unrestricted) under the completeness and transitivity of a binary relation. Theorem 2 uses the primitive notion of a separately continuous function to answer the question when an analogous property on a relation is fully continuous. Theorem 3 provides (...) a portmanteau theorem on the equivalence between restricted solvability and various notions of continuity under weak monotonicity. Finally, Theorem 4 presents a variant of Theorem 3 that follows Theorem 1 in dispensing with the dimensionality requirement and in providing partial equivalences between solvability and continuity notions. These theorems are motivated for their potential use in representation theorems. (shrink)

In his short life, Alan Turing (1912-1954) made foundational contributions to philosophy, mathematics, biology, artificial intelligence, and computer science. He, as much as anyone, invented and showed how to program the digital electronic computer. From September, 1939, his work on computation was war-driven and brutally practical. He developed high speed computing devices needed to decipher German Enigma Machine messages to and from U-boats, countering the most serious threat by far to Britain..