Imperfect Perception and Stochastic Choice in Experiments

The branch of psychology that studies how physical objects are perceived by subjects is known as psychophysics. A feature of the experimental design is that the experimenter presents objectively measurable objects that are imperfectly perceived by subjects. The responses are stochastic in that a subject might respond differently in otherwise identical situations. These stochastic choices can be compared to the objectively measurable properties. This Element offers a brief introduction to the topic, explains how psychophysics insights are already present in economics, and describes experimental techniques with the goal that they are useful in the design of economics experiments. Noise is a ubiquitous feature of experimental economics and there is a large strand of economics literature that carefully considers the noise. However, the authors view the psychophysics experimental techniques as uniquely suited to helping experimental economists uncover what is hiding in the noise.

List of contents

1. The apparently random coffee purchases of a colleague; 2. A brief introduction to the psychophysics literature; 3. Psychophysics insights already in the economics literature; 4. Models that are difficult to test without psychophysics experimental techniques; 5. Incentivized perceptual decision-making literature; 6. Possible directions for experimental economics; References.

Summary

This Element offers a brief introduction to the topic, describes how psychophysics insights are already present in economics, and describes experimental techniques with the goal that they are useful in the design of economics experiments.

Foreword

While insights from classical psychophysics appear in economic theory, experimental techniques have an unrealized promise for economics.

Product details

• Authors: Pablo (Universidad Loyola Andalucia) Branas-Garza, Pablo Brañas-Garza, John Alan Smith
• Publisher: Cambridge University Press ELT
• Languages: English
• Product format: Hardback
• Released: 30.11.2023
• EAN: 9781009454414
• ISBN: 978-1-0-0945441-4
• No. of pages: 70
• Series: Elements in Behavioural and Experimental Economics
• Subjects: Social sciences, law, business > Business > Economics; BUSINESS & ECONOMICS / Economics / Theory, BUSINESS & ECONOMICS / Econometrics, Economic theory & philosophy, Economic statistics, Behavioural economics, Stochastics, Econometrics, Economic theory and philosophy, BUSINESS & ECONOMICS / Economics / Social & Behavioral, Econometrics and economic statistics