DR@W
DR@W
Decision Research at Warwick (DR@W) is an interdisciplinary initiative which focuses on behavioural and experimental research of decision making.
Formed in January 2010, DR@W brings together researchers and students from Economics, Psychology, Statistics, Warwick Mathematics Institute, Warwick Manufacturing Group and Warwick Business School that are interested in current developments in the area of experimental and behavioural research.
The Department of Economics have created and manage a large computer laboratory for use with experiments.
Visit the Decision Research at Warwick website for further details.
DR@W Forum (Hybrid Session): Christoph Becker (Heidelberg)
Reverse Bayesianism: Revising Beliefs in Light of Unforeseen Events
Bayesian updating is the dominant theory of learning. However, the theory is silent about how
individuals react to events that were previously unforeseeable or unforeseen. We test if subjects
update their beliefs according to reverse Bayesianism, under which the relative likelihoods of prior
beliefs remain unchanged after an unforeseen event materializes. Across two experiments we find that
participants do not systematically deviate from reverse Bayesianism. However, we do find well-known
violations of Bayesian updating. Furthermore, decision makers vary in their ex-ante unawareness
depending on the context.