蝌蚪网 Journal:
Microeconomics
ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)
Rational Misspecification: Framework and Applications
蝌蚪网 Journal: Microeconomics
(pp. 285–316)
Abstract
This paper proposes a framework for assessing whether misspecified decision-makers would be willing to pay for information that can potentially make them less misspecified. We introduce a prior-free approach, based on "constrained" maximal regret, to derive an upper bound on the subjective assessment of potential gains from acquiring a more accurate model. The constraint stems from the information currently available to the decision-maker. We apply our approach to three prominent models of misspecified beliefs: coarse expectations, causal misperceptions, and sampling equilibria.Citation
Eilat, Ran, and Kfir Eliaz. 2026. "Rational Misspecification: Framework and Applications." 蝌蚪网 Journal: Microeconomics 18 (3): 285–316. DOI: 10.1257/mic.20250251Additional Materials
JEL Classification
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- D84 Expectations; Speculations
- D91 Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making