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We take Cumulative Prospect Theory (CPT) seriously by rigorously estimating structural models using the full set of CPT parameters. Much of the literature only estimates a subset of CPT parameters, or more simply assumes CPT parameter values from prior studies. Our data are from laboratory experiments with undergraduate students and MBA students facing substantial real incentives and losses. We also estimate structural models from Expected Utility Theory (EUT), Dual Theory (DT), Rank-Dependent Utility (RDU), and Disappointment Aversion (DA) for comparison. Our major finding is that a majority of individuals in our sample locally asset integrate. That is, they see a loss frame for what it is, a frame, and behave as if they evaluate the net payment rather than the gross loss when one is presented to them. This finding is devastating to the direct application of CPT to these data for those subjects. Support for CPT is greater when losses are covered out of an earned endowment rather than house money, but RDU is still the best single characterization of individual and pooled choices. Defenders of the CPT model claim, correctly, that the CPT model exists “because the data says it should.” In other words, the CPT model was borne from a wide range of stylized facts culled from parts of the cognitive psychology literature. If one is to take the CPT model seriously and rigorously then it needs to do a much better job of explaining the data than we see here.

Behavioral economics poses a challenge for the welfare evaluation of choices, particularly those that involve risk. It demands that we recognize that the descriptive account of behavior toward those choices might not be the ones we were all taught, and still teach, and that subjective risk perceptions might not accord with expert assessments of probabilities. In addition to these challenges, we are faced with the need to jettison naive notions of revealed preferences, according to which every choice by a subject expresses her objective function, as behavioral evidence forces us to confront pervasive inconsistencies and noise in a typical individual’s choice data. A principled account of errant choice must be built into models used for identification and estimation. These challenges demand close attention to the methodological claims often used to justify policy interventions. They also require, we argue, closer attention by economists to relevant contributions from cognitive science. We propose that a quantitative application of the “intentional stance” of Dennett provides a coherent, attractive and general approach to behavioral welfare economics.

The author presents new estimates of the probability weighting functions found in rank-dependent theories of choice under risk. These estimates are unusual in two senses. First, they are free of functional form assumptions about both utility and weighting functions, and they are entirely based on binary discrete choices and not on matching or valuation tasks, though they depend on assumptions concerning the nature of probabilistic choice under risk. Second, estimated weighting functions contradict widely held priors of an inverse-s shape with fixed point well in the interior of the (0,1) interval: Instead the author usually finds populations dominated by “optimists” who uniformly overweight best outcomes in risky options. The choice pairs used here mostly do not provoke similarity-based simplifications. In a third experiment, the author shows that the presence of choice pairs that provoke similarity-based computational shortcuts does indeed flatten estimated probability weighting functions.

This study aims to investigate the psychological process of intertemporal choices between larger-later and smaller-sooner monetary options. Prior research showed consumer impatience – a tendency to prefer a smaller-sooner option over a larger-later option. This research identifies an individual difference that predicts patience and mediators that explain the underlying mechanism.

Two studies are conducted. Study 1 examines whether the implicit theory of intelligence consumers endorse (i.e. entity theory vs incremental theory) constitutes an antecedent of patience and whether their thoughts regarding anticipated purchase with the chosen monetary option (i.e. hedonic versus utilitarian purchase) mediate the relationship. Study 2 analyzes whether psychological reactance toward larger-later options is a mediator in this relationship using a perceived threat to freedom and affect as reactance indicators.

Entity-oriented consumers exhibited less patience than incremental-oriented consumers, especially when anticipating a hedonic purchase. Moreover, entity-oriented consumers perceived a threat to freedom from larger-later options more strongly – this enhanced perception influenced patience through two routes. One route is that the perceived threat to freedom leads to more consideration of a hedonic purchase rather than a utilitarian purchase, thereby decreasing patience. The other route is that the perceived threat to freedom elicits a stronger negative affect, resulting in lower patience.

Findings of this research shed light on the understanding of patience. They demonstrate that consumers’ implicit theory orientation is a crucial individual difference that can explain patience. Also, demonstrating the mediating roles of anticipated purchase using the hedonic/utilitarian classification and psychological reactance expanded literature by showing how they internally interact.

The paper provides a detailed historical account of Douglass C. North's early intellectual contributions and analytical developments in pursuing a Grand Theory for why some countries are rich and others poor.

The author approaches the discussion using a theoretical and historical reconstruction based on published and unpublished materials.

The systematic, continuous and profound attempt to answer the Smithian social coordination problem shaped North's journey from being a young serious Marxist to becoming one of the founders of New Institutional Economics. In the process, he was converted in the early 1950s into a rigid neoclassical economist, being one of the leaders in promoting New Economic History. The success of the cliometric revolution exposed the frailties of the movement itself, namely, the limitations of neoclassical economic theory to explain economic growth and social change. Incorporating transaction costs, the institutional framework in which property rights and contracts are measured, defined and enforced assumes a prominent role in explaining economic performance.

In the early 1970s, North adopted a naive theory of institutions and property rights still grounded in neoclassical assumptions. Institutional and organizational analysis is modeled as a social maximizing efficient equilibrium outcome. However, the increasing tension between the neoclassical theoretical apparatus and its failure to account for contrasting political and institutional structures, diverging economic paths and social change propelled the modification of its assumptions and progressive conceptual innovation. In the later 1970s and early 1980s, North abandoned the efficiency view and gradually became more critical of the objective rationality postulate. In this intellectual movement, North's avant-garde research program contributed significantly to the creation of New Institutional Economics.

The purpose of this study to add to the body of knowledge by examining and discussing school choice trends through the perspective of rational choice theory. This qualitative research explores rationale behind the choice of government schools by middle-class parents in contemporary India. This research will also shed light on the features of the schools that parents consider while making school selection process. Finally, research focuses upon the process and context of decision-making and dynamics involved therein. In other words, the attempt is being made to understand what is the yardstick used by parents to differentiate “good” and “bad” school.

This qualitative research was conducted in two government (central and state) schools in Lucknow, India. The findings of the study are based on 22 qualitative interviews conducted with parents of school-going children, and principal or headmaster of the school. The interviews were unstructured and open-ended and were supported by observations. The observation was not only made of the social setting but also the reaction of the participants. The idea was to develop an emic view of the subject by exploring valid narratives. Pseudonyms were used to report the finding so as to maintain the confidentiality of the research subjects.

This research found that the majority of the parents chose school according to their social class, that is, the lower middle-class parents sent their wards to state government primary school, while the middle-class parents preferred to send their wards to central government school (Kendriya Vidyalaya). This study, therefore, lends credence to the contention that the middle class is a variegated social category and the dynamics of school choice vary across its subcategories. This lends credence to the contention that school choice decision is not solely a utilitarian choice and may be guided by emotion as well.

The originality of the research lies in the fact that the authors are extending the arguments made by the rational choice theory. The theory proposes that individual makes rational decisions motivated by self-interest and people look for the finest product or service and in pursuing them attempt to maximize their overall utility. Derivatively, Indian parents rationally make school choice decisions for their wards, gathering information and weighing various options and subsequently choose the “best” school for their children. This study moves beyond the prevailing perception that public schools offer low-quality education, and nobody attends such schools out of choice.

In spite of the increasing number of Islamic banks offering Islamic investment products, there is, as yet, little academic research on this topic and the consumer acceptance of the products is not yet understood fully. To help in bridging this gap, this study aims to assess the determinants of choice behaviour of Islamic investment products in Malaysia.

Using the Theory of Consumption Value (TCV) as a baseline theory, data are obtained from 460 bank customers who intend to invest in the products.

The results of this study show that emotional value, epistemic value, conditional value, functional value and social value are significantly related to the choice behaviour of Islamic investment products.

Three concerns were found in this study. Firstly, the geographies of this study are narrowed down to bank customers who were resided in specific areas in East Malaysia. Secondly, the authors used the TCV on a particular focus of Islamic banking products. Future studies should address these issues accordingly for improved application and generalisation. Thirdly, some reliability issues were identified in composite reliability values and the related future studies are expected to strengthen the research design to extend the findings at best.

The results are helpful for practitioners to develop new business models of Islamic investment products in Malaysia.

This study provides meaningful insights for theory building of choice behaviour in the context of Islamic investment products, where the TCV comes into play.

The purpose of the study is to conceptualize the model of the predictors of consumer willingness to purchase green products. This study used the underpinning theories related to consumer willingness by integrating the green concept in deriving the consumer willingness to purchase green products. Based on the underpinning theories of marketing strategies, it was found that marketing mix was still fundamental in business. Therefore, green marketing mix was proposed to describe the consumer's green purchase willingness. Furthermore, corporate social responsibility (CSR) plays an important role as the key to organizational strategy. Thus, CSR is also included in the proposed framework. As this is a conceptual paper, further empirical study needs to carry out to verify the proposed hypotheses. This study contributes to the market practitioners or entrepreneurs in terms of re-considering marketing mix and CSR in deriving customer willingness to purchase green products. This study extends the literature of behavioural intention by integrating green marketing strategies with CSR in determining consumer willingness to purchase.

This study aims to investigate the effects of several individual elements vis-a-vis the environment that affects students’ choice of a career. The study assesses the effects of cognitive-person factors on the career decision-making of tertiary students and analyses how chance events moderate these relationships.

The study used the survey research design to gather data from 302 final-year tertiary students from four (4) Faculties and sixteen (16) academic departments of a Technical University in Ghana. Data were collected through self-administered questionnaires and analysed using the partial least square structural equation modelling (PLS-SEM).

The study reveals that students’ self-efficacy and outcome expectations are two cognitive-person factors that positively and significantly influence students’ career choices. However, chance events of tertiary students were found not to moderate the relationship between cognitive-person factors and students’ career choices.

Understanding how several cognitive-person factors influence the career choice of students through the lens of social career-cognitive theory could enable researchers to advance knowledge in the career choice process. Counselors and guidance coordinators need to motivate and encourage career/job exploration and development by identifying sources of psychosocial support available to students.

This study identifies the cognitive person factors that drive career decisions and provides one of the initial attempts to investigate how chance events moderate students’ cognitive-person career choice relationship.

A central question of public administration is how political principals secure the cooperation of administrators within organisational frames and contexts; increasingly, rational influences are being considered alongside bounded rationality and non-rational influences. This paper aims to explore the intent of New Zealand’s Public Service Act 2020 in managing administrative behaviour.

The methodology is primarily ethnographic, combining emic and etic perspectives. A mixed-methods approach comprises participant observer field notes and meeting documentation, substantiated by official documents; documents were analysed thematically and triangulated with other data sources.

The Public Service Act introduces new bounds on administrative behaviour. The stated rationale for these changes reveals an attempt to set limits on the principal–agent relationship between politicians and administrators and causes predictable deviations from rational behaviour by cultivating public service motivation and a unified public service identity.

As the legislation in question was only passed in 2020, it is too early to definitively assess the ultimate impact of legislation on administrative behaviour. This case study demonstrates that behavioural approaches to public administration are being applied intentionally by governments. The choice architecture created in the case study blends rational, bounded, and non-rational influences. Together, this produces a bricolage of semi-relevant theories from other disciplines, especially psychology, to explain administrative behaviour. Further refinement is needed to develop a cohesive and comprehensive theory of administrative behaviour that can account for contemporary practice.

Administrators act as agents of political principals, within ethical and rules-based limitations and influenced by public service motivation and social identity. Shifting from implicit to explicit choice architecture does not negate possible tensions between bounds and can signal them more explicitly. Shared symbols are sometimes intended to influence identity and therefore adherence to behavioural norms.

This paper explores the manipulation of choice architecture as a viable strategy for altering behaviour for the better and, to the best of the authors’ knowledge, is the first known instance of choice architecture being “legislated in” rather than merely “showing through”. This study illustrates the blending of rational, boundedly rational and non-rational factors into a choice architecture for public administrators that help mediate the biases and challenges of principal–agent relationships (which form a cascade in New Zealand’s public administration system).