I'll See It When I Believe It - A Simple Model of Cognitive Consistency
Year: 2002
Type: preprint
Abstract: Many observations from psychology, political science, and organizational behavior indicate that people exhibit a taste for consistency. Individuals are inclined to interpret new evidence in ways that confirm their pre-existing beliefs. They also tend to change their beliefs to enhance the desirability of their past actions. The current paper explores the implications of a simple model incorporating these effects into an agent’s utility function. The model allows a characterization of when: 1. agents become under- and over-confident, 2. agents prefer less accurate signals, i.e., they are willing to pay in order to forgo information, and 3. agents exhibit excess stickiness or excess volatility in action choices.
Author: Leeat Yariv
Institution: Princeton University
Language: English
Subfield: General Decision Sciences
Field: Decision Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1558014612