Advancement to Candidacy Presentation: “Good News Bad News with Non-Bayesian Agents", Kenneth Chan

Speaker

Kenneth Chan, University of California, Santa Barbara

Biography

Kenneth is a PhD student studying Economics at UCSB. Prior to joining UCSB, he received a Bachelor of Social Sciences in Economics from the National University of Singapore in 2020. Kenneth's research interests lie within the realms of Behavioral and Experimental Economics. His current projects study how people incorporate new information into their beliefs, contributing to our understanding of people's decision-making processes under uncertainty. 

In addition to his academic pursuits, Kenneth has a strong interest in contract bridge, a partnership-based game involving decision-making under conditions of uncertainty. He has represented Singapore in bridge and even engaged in semi professional play. This game sparked his inspiration to pursue a Ph.D. in economics to study human behavior and decision making processes.

Event Details

Kenneth Chan will be presenting his Advancement to Candidacy paper, “Good News Bad News with Non-Bayesian Agents”. To access the Advancement paper, you must have an active UCSB NetID and password.

Abstract and JEL Codes

This paper presents an alternative characterization of the Grether (1980) model that is centered around the preservation of the Monotone Likelihood Ratio Property (MLRP). I also show that Bayesian updating can be characterized by the preservation of MLRP and the martingale property. Using this representation result, I identify a class of non-Bayesian updating rules where we can obtain useful comparative statics across different signal realization in canonical belief updating problems. In the pilot experiment, I found suggestive evidence that people update their beliefs in a manner where MLRP is preserved from signals. This provides some validation for the widely used Grether (1980) model.

JEL codes: C91, D01, D83, D90