Exchange mechanisms, endogenous preferences and bounded rationality

  • van de Klundert, Theo (Tutor)
  • van de Ven, J. (Researcher)

    Project: Research project

    Project Details


    "Calculus of pleasure" may be subdivided into Economics and Utilitarian Ethics (Edgeworth). The economical calculus investigates the equilibrium of a system of forces tending to maximize individual utility. The second part is usually ignored. However, the neglect of other motivations, such as intrinsic motivations and ethical considerations, leads to misunderstanding in topics like social choice theory and exchange mechanisms. This topic has gained in popularity and attention in recent years.
    The scope of this project is to incorporate, to a certain extent, the endogeneity of preferences into the framework of economics. The preferences are endogenous with respect to attitudes, and are closely related to ethics. The emphasis is not on developing an ethical theory but on explaining how certain phenomena can be explained by changing preferences. For example, the evolution and equilibria of exchange mechanisms. Other keywords related to the choice of a particular exchange mechanism are transaction costs and bounded rationality. The aim is to provide a framework of economic models rather than being descriptive.
    Short titleExchange mechanisms, endogenous preferences and bounded rationality
    Effective start/end date1/02/991/02/03