The gradual nature of economic errors

Carlos Alós-Ferrer, Michele Garagnani

Research output: Contribution to journalArticlepeer-review


Overwhelming evidence from the cognitive sciences shows that, in simple discrimination tasks (determining what is louder, longer, brighter, or even which number is larger) humans make more mistakes and decide more slowly when the stimuli are closer along the relevant scale. We investigate to what extent these effects are relevant for economic decisions in a setting where optimal choices are objectively known (and independent of attitudes toward risk). We find that, even for tasks with objectively-correct answers, error rates and response times increase gradually as expected values become closer. Differences in payoff-independent numerical magnitudes also play a role, which however only becomes clear when one accounts for expected values. We conclude that the gradual effects on choice found in cognitive discrimination paradigms are very much present in economic choices, and depend on economic as well as perceptual variables.

Original languageEnglish (US)
Pages (from-to)55-66
Number of pages12
JournalJournal of Economic Behavior and Organization
StatePublished - Aug 2022


  • Decision errors
  • Stochastic choice
  • Strength of preference

ASJC Scopus subject areas

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management


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