Experiments on Stable Suboptimality in Individual Behavior

• Published in: The American economic review Vol. 81; no. 2; pp. 360 - 364
• Main Author: Herrnstein, R. J.
• Format: Journal Article
• Language: English
• Published: Menasha, Wis American Economic Association 01.05.1991; American Economic Assoc
• Subjects: Behavior; Choices; Earnings; Economic theory; Economics; Expected utility; Experimentation; Experiments; Geometric lines; Implications; Individual; Individual behaviour; Investment return rates; Konsumentenverhalten; Learning and Adaptive Economic Behavior; Profit maximization; Psychological reinforcement; Sozialpsychologie; Studies; Theorie; Weighted averages; United States > US
• ISSN: 0002-8282; 1944-7981

In several recent experiments, subjects behaved irrationally, and their irrationality appeared to be systematic and motivated. The subjects worked for money by repeatedly choosing one of 2 alternatives in procedures in which the long-run pattern of choice interacted with the rate of payment for each alternative. They earned less money than they could have, and there was no plausible compensating nonmonetary gain. Melioration rather than maximization appears to have driven the subjects' choices in 2 experiments that did not pit melioration against maximization in a way that would decisively affect earnings. In a 3rd experiment, melioration implied the maximally inefficient allocation of choices. A large majority of subjects learned the least efficient strategy, and obeying the principle of melioration was relatively expensive. The evidence points toward generically suboptimal human choice under at least some conditions.