A Markov Decision Process with Awareness and Present Bias in Decision-Making
We propose a Markov Decision Process Model that blends ideas from Psychological research and Economics to study decision-making in individuals with self-control problems. We have borrowed a dual-process of decision-making with self-awareness from Psychological research, and we introduce present bias...
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| Format: | Article |
| Language: | English |
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MDPI AG
2023-06-01
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| Series: | Mathematics |
| Subjects: | |
| Online Access: | https://www.mdpi.com/2227-7390/11/11/2588 |
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| author | Federico Bizzarri Chiara Mocenni Silvia Tiezzi |
| author_facet | Federico Bizzarri Chiara Mocenni Silvia Tiezzi |
| author_sort | Federico Bizzarri |
| collection | DOAJ |
| description | We propose a Markov Decision Process Model that blends ideas from Psychological research and Economics to study decision-making in individuals with self-control problems. We have borrowed a dual-process of decision-making with self-awareness from Psychological research, and we introduce present bias in inter-temporal preferences, a phenomenon widely explored in Economics. We allow for both an exogenous and endogenous, state-dependent, present bias in inter-temporal decision-making and explore, by means of numerical simulations, the consequences on well-being emerging from the solution of the model. We show that, over time, self-awareness may mitigate present bias and suboptimal choice behaviour. |
| first_indexed | 2024-03-11T03:01:25Z |
| format | Article |
| id | doaj.art-3216ded7e516493ca61f5f86543f918f |
| institution | Directory Open Access Journal |
| issn | 2227-7390 |
| language | English |
| last_indexed | 2024-03-11T03:01:25Z |
| publishDate | 2023-06-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Mathematics |
| spelling | doaj.art-3216ded7e516493ca61f5f86543f918f2023-11-18T08:14:04ZengMDPI AGMathematics2227-73902023-06-011111258810.3390/math11112588A Markov Decision Process with Awareness and Present Bias in Decision-MakingFederico Bizzarri0Chiara Mocenni1Silvia Tiezzi2Department of Information Engineering and Mathematics, University of Siena, Via Roma, 56, 53100 Siena, ItalyDepartment of Information Engineering and Mathematics, University of Siena, Via Roma, 56, 53100 Siena, ItalyDepartment of Economics and Statistics, University of Siena, Piazza San Francesco, 7/8, 53100 Siena, ItalyWe propose a Markov Decision Process Model that blends ideas from Psychological research and Economics to study decision-making in individuals with self-control problems. We have borrowed a dual-process of decision-making with self-awareness from Psychological research, and we introduce present bias in inter-temporal preferences, a phenomenon widely explored in Economics. We allow for both an exogenous and endogenous, state-dependent, present bias in inter-temporal decision-making and explore, by means of numerical simulations, the consequences on well-being emerging from the solution of the model. We show that, over time, self-awareness may mitigate present bias and suboptimal choice behaviour.https://www.mdpi.com/2227-7390/11/11/2588awarenesspresent biasdecision-makingMarkov Decision Process |
| spellingShingle | Federico Bizzarri Chiara Mocenni Silvia Tiezzi A Markov Decision Process with Awareness and Present Bias in Decision-Making Mathematics awareness present bias decision-making Markov Decision Process |
| title | A Markov Decision Process with Awareness and Present Bias in Decision-Making |
| title_full | A Markov Decision Process with Awareness and Present Bias in Decision-Making |
| title_fullStr | A Markov Decision Process with Awareness and Present Bias in Decision-Making |
| title_full_unstemmed | A Markov Decision Process with Awareness and Present Bias in Decision-Making |
| title_short | A Markov Decision Process with Awareness and Present Bias in Decision-Making |
| title_sort | markov decision process with awareness and present bias in decision making |
| topic | awareness present bias decision-making Markov Decision Process |
| url | https://www.mdpi.com/2227-7390/11/11/2588 |
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