A Sparsity-Based Model of Bounded Rationality

By Xavier Gabaix. 2014

682 citations recorded by the source corpus.

Subfields: Economics and Econometrics, General Decision Sciences

View Paper: https://www.semanticscholar.org/paper/773590777c9c493226b75e08cf840dc296bd8226

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Citations in the corpus

Do Managers Overreact to Salient Risks? Evidence from Hurricane Strikes (2017, background): “11 Other models based on the mechanism of salience include Bordalo, Gennaioli and Shleifer (2012a, 2013a), Gabaix (2011), Gennaioli and Shleifer (2010), Köszegi and Szeidl (2013), and Schwartzstein (2009).”
Incomplete Information in Macroeconomics: Accommodating Frictions in Coordination (2016, neutral): “Consider, in particular, Sims (2003), Reis (2006), and Gabaix (2014).”
A Behavioral New Keynesian Model (2020, positive): “This includes limited information updating (Gabaix and Laibson (2002), Mankiw and Reis (2002)), related differential salience (Bordalo et al. (2013)), and noisy signals (Sims (2003), Maćkowiak and Wiederholt (2015), Caplin et al.”
Market Efficiency in the Age of Big Data (2019, positive): “One can think of this as bounded rationality that induces excessive shrinkage or sparsity of investors’ forecasting models, along the lines of Sims (2003) , Gabaix (2014) , and Molavi et al. (2020) .”
Regressive Sin Taxes, with an Application to the Optimal Soda Tax* (2019, background): “Gabaix (2015): “Optimal Taxation with Behavioral Agents,” Working Paper 21524, National Bureau of Economic Research.”
Learning Through Noticing: Theory and Evidence from a Field Experiment (2014, methodology): “…was accepted *We thank Daniel Benjamin, Matthew Gentzkow, Marina Halac, Andy Newman, Ted O’Donoghue, Tim Ogden, Matthew Rabin, Andrei Shleifer, and four anonymous referees for extremely helpful comments, as well as seminar participants at the Behavioural Decision Theory Conference, Berkeley,…”
Executive Compensation: A Survey of Theory and Evidence (2017, neutral): “Garen (1994) shows that salaries are insignicantly increasing in rm risk as measured by dollar volatility, and insignicantly decreasing in percentage volatility.”
Memory, Attention, and Choice* (2020, positive): “In economics, a conventional approach to this issue is rational inattention (Sims 2003), or the idea that paying attention to all price changes is too costly (Gabaix 2014).”
Natural Expectations, Macroeconomic Dynamics, and Asset Pricing (2012, background): “Constraints on memory and cognition make it diffi cult for agents to work with complicated models, leading decision makers to adopt simplifi cations and heuristics (e.g., Tversky and Kahneman 1974; Gigerenzer and Goldstein 1996; Gabaix et al. 2006; Gabaix 2011).”
Do investors care about carbon risk? (2020, background): “Even socially responsible investors that care about climate change may use sparse models (à la Gabaix, 2014) and not look much beyond industry categorizations, such as the energy and electric utility sectors, which produce a disproportionate share of CO2 emissions.”