Weekly Seminar – April 11: Shachar Kariv (University of California, Berkeley), “The Predictivity and Falsifiability of Theories of Choice Under Uncertainty”

Date: April 11th, 2024 (12:30 pm – 1:30 pm)

Paper Title: “The Predictivity and Falsifiability of Theories of Choice Under Uncertainty” with with Keaton Ellis (UC Berkeley), and Erkut Ozbay, (University of Maryland)

Abstract: Economic models are founded on parsimony and interpretability, which is achieved through axioms on choice behavior. We empirically evaluate the predictive accuracy of economic models of choice under risk and ambiguity, and the strength of their axiomatic foundations, using complementary methods of completeness (Fudenberg et al., 2022) and restrictiveness (Fudenberg et al., 2023), respectively. To better understand the tradeoff between the two concepts, we additionally relate their performance to machine learning models. We use budgetary choice environments with three dimensions to provide a strong test of axioms. We show that adding a third dimension of choice marginally reduces completeness of economic models, but significantly increases restrictiveness. Economic models are also more complete than machine learning models, and are significantly more restrictive. These results are robust to considering an environment of choice under ambiguity than choice under risk.

Bio:

Shachar Kariv is a Benjamin N. Ward Professor of Economics. He was educated at Tel Aviv University and New York University, where he received my Ph.D. in economics in 2003, the same year he joined the Department of Economics at the University of California, Berkeley. He has been the Department Chair (2014-17 and 2021-22) the Faculty Director of UC Berkeley Experimental Social Science Laboratory (2009-2014), aka Xlab, a laboratory for conducting experiment-based investigations of issues of interest to social sciences.

Shachar was a visiting member of the School of Social Science at the Institute for Advanced Studies at Princeton (2005-6), a visiting professor at the European University Institute (2008), a visiting fellow at Nuffield Collegeof the University of Oxford (2009), a visiting professor at the Interdisciplinary Center (IDC) Herzliya (2011-12), and a visiting professor at the Department of Economics at Stanford University (2014). I am also a visiting professor (Professor II) at the Department of Economics at the NHH Norwegian School of Economics where he is affiliated with the Choice Lab.

Shachar is also the recipient of the UC Berkeley Haas School of Business Cheit Award for Excellence in Teaching (2012), the UC Berkeley Division of Social Sciences Distinguished Teaching Award (2008), and the Graduate Economics Association Outstanding Advising Award (2006). And was also awarded NYU College of Arts and Science Outstanding Teaching Award (Golden Dozen) in recognition of excellence in teaching and contributions to undergraduate education (2002) and NYU Dean’s Outstanding Teaching Award in the Social Sciences (2001). For his Ph.D. dissertation at NYU, he received the Outstanding Dissertation Award in the Social Sciences (2003), and was also awarded a Sloan Research Fellowship for Economics (2009-10).

Center for Experimental Social Science

The Center for Experimental Social Science is an inter-disciplinary research center at New York University engaged in laboratory experimental work in the social sciences that combines high quality Economic Theory, Psychology, Political Science, and Neuroscience.

Weekly Seminar – April 11: Shachar Kariv (University of California, Berkeley), “The Predictivity and Falsifiability of Theories of Choice Under Uncertainty”