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Nonparametric learning rules from bandit experiments: The eyes have it!

Hu, Yingyao and Kayaba, Yutaka and Shum, Matthew (2013) Nonparametric learning rules from bandit experiments: The eyes have it! Games and Economic Behavior, 81 . pp. 215-231. ISSN 0899-8256. doi:10.1016/j.geb.2013.05.003.

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How do people learn? We assess, in a model-free manner, subjectsʼ belief dynamics in a two-armed bandit learning experiment. A novel feature of our approach is to supplement the choice and reward data with subjectsʼ eye movements during the experiment to pin down estimates of subjectsʼ beliefs. Estimates show that subjects are more reluctant to “update down” following unsuccessful choices, than “update up” following successful choices. The profits from following the estimated learning and decision rules are smaller (by about 25% of average earnings by subjects in this experiment) than what would be obtained from a fully-rational Bayesian learning model, but comparable to the profits from alternative non-Bayesian learning models, including reinforcement learning and a simple “win-stay” choice heuristic.

Item Type:Article
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URLURL TypeDescription DOIArticle ItemWorking Paper
Shum, Matthew0000-0002-6262-915X
Additional Information:© 2013 Elsevier Inc. Received 22 February 2012; Available online 30 May 2013. We are indebted to Antonio Rangel for his encouragement and for the funding and use of facilities in his lab. We thank Dan Ackerberg, Peter Bossaerts, Colin Camerer, Andrew Ching, Mark Dean, Cary Frydman, Ian Krajbich, Pietro Ortoleva, Joseph Tao-yi Wang and participants in presentations at U. Arizona, Caltech, UCLA, U. Washington and Choice Symposium 2010 (Key Largo) for comments and suggestions. Kayaba thanks the Nakajima Foundation for the financial support.
Funding AgencyGrant Number
Nakajima FoundationUNSPECIFIED
Subject Keywords:Learning; Belief dynamics; Experiments; Eye tracking; Bayesian vs. non-Bayesian learning
Classification Code:JEL classification: D83; C91; C14
Record Number:CaltechAUTHORS:20131017-093750421
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Official Citation:Yingyao Hu, Yutaka Kayaba, Matthew Shum, Nonparametric learning rules from bandit experiments: The eyes have it!, Games and Economic Behavior, Volume 81, September 2013, Pages 215-231, ISSN 0899-8256, (
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:41966
Deposited By: Tony Diaz
Deposited On:17 Oct 2013 21:07
Last Modified:10 Nov 2021 04:36

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