Behavioral Economic Theory

I explore the frontiers of behavioural economics in three branches of this project. The first branch will explain risk attitudes by information processing frictions. The second branch will identify welfare generated by markets from standard market data, allowing for a realistic possibility that the consumers are making mistakes in their marginal comparisons. The third branch draws mathematical analogies between statistics and economic growth; this allows for a transfer of methods from statistical models of decision-making to the macroeconomic topic of growth.