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dc.creatorAcevedo, Rafael A.
dc.creatorAponte, Elvis
dc.creatorHarmath, Pedro
dc.creatorMora, Jose U.
dc.date.accessioned2021-04-02T17:31:39Z
dc.date.available2021-04-02T17:31:39Z
dc.date.issued2021
dc.identifier.citationAcevedo, R.A., Aponte, E., Harmath, P., & Mora, J.U. (2021). Rational irrationality: A two stage decision making model. Advances in Decision Sciences, 25 (1), 1-39. https://doi.org/10.47654/v25y2021i1p1-39en_US
dc.identifier.urihttps://doi.org/10.47654/v25y2021i1p1-39
dc.identifier.urihttps://hdl.handle.net/2346/86882
dc.description.abstractThis paper proposes a mathematical two-stage decision making model based on dual-decision models from behavioral economics that includes, in addition to cognitive and affective systems, an individualistic human factor and a stochastic shock. The model provides a new vision of the decision-making process and the impact of individualism. In the first stage, the agent´s initial willingness to choose is obtained following traditional economic theory but including an individual human factor, which is composed by the learning process, free will, and other human factors. This allows us to explain the reason why sometimes people are inclined to choose options that seem to be irrational decisions from the view of traditional economics logic. In the second stage, the model explains how the cognitive and affective systems and the influence of a stochastic shock affect the initial willingness to choose, obtained in the first stage. The shock might be produced by those negative and/or positive feelings and information not known or considered previously that allows the individual arrive to the final decision. Finally, our model demonstrates that the individual human factor and the stochastic shock are fundamental elements that define the rational irrationality when traditional economic theory fails to explain individuals' choices.en_US
dc.language.isoengen_US
dc.publisherAsia University, Taiwanen_US
dc.subjectDecision Makingen_US
dc.subjectExpected Utilityen_US
dc.subjectBehavioral Economicsen_US
dc.subjectCognitive and Affective Systemsen_US
dc.subjectHuman Factoren_US
dc.titleRational irrationality: A two stage decision making modelen_US
dc.typeArticleen_US


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