Portfolio Selection from Multiple Benchmarks: A Goal Programming Approach to an Actual Case

This paper deals with benchmark‐based portfolio choice for buy‐and‐hold strategies of investing. Multiple benchmarks for returns are considered, which is more realistic than taking a unique benchmark – a unique aspiration difficult to select in practice among the various aspirations for returns that the investor has in mind. Portfolio selection with multiple benchmarks leads to a multi‐objective problem, which is addressed by mean value – stochastic goal programming. In particular, two benchmarks are considered, which involves two goals. Weights for goals depend on investor's preferences and Arrow's absolute risk aversion coefficients. An efficient frontier of portfolios is obtained. Advantages of this stochastic method in our context are as follows: (i) Mean value‐stochastic goal programming relies on classical utility theory under uncertainty and Arrow's absolute risk aversion, which ensures soundness and strictness, and (ii) the numerical model is easily solved by using available software such as mean–variance software. Numerical results are tabulated and discussed. Copyright © 2011 John Wiley & Sons, Ltd.     

Coordination after gains and losses: Is prospect theory’s value function predictive for games?

We analyze the effects of prior gain and loss experiences on individuals’ behavior in two coordination games: battle of the sexes and simultaneous market entry. We propose subjectively transformed games that integrate elements of prospect theory, aggregation of prior and subsequent payoffs, and social projection. Mathematical predictions of behavior are derived based on equilibrium selection concepts. Males’ behavior in our experimental studies is largely consistent with our predictions. However, the behavior of many female respondents appears to be rather consistent with interpreting the initial random lottery outcomes used to manipulate prior experiences as a signal for the players’ abilities to compete. This could be related to females’ known uneasiness of competing against counterparts that might be male and thus, a generally higher salience of rivalry in our incentivized experiments. Females also chose to play far more mixed strategies than males indicating some uncertainty about what type of behavior is appropriate.     

Attachment to groups: Relationships with group esteem,self-esteem,and investment in ingroups

We apply a model of interpersonal attachment style to the group domain, examining how attachment to ingroups relates to self-views, group esteem, and ingroup investment. In Study 1 (N = 306), participants completed measures of self-esteem, group esteem, group attachment insecurity, and investment. Study 2 (N = 316) implemented a within-subjects experimental design in which participants completed the same measures as in Study 1 with regard to ingroups they held in high versus low esteem. In both studies, the negative relationship between group esteem and group attachment avoidance was stronger among participants with higher self-esteem, and the negative relationship between self-esteem and group attachment anxiety was stronger for more esteemed ingroups. Over and above group esteem, group attachment anxiety was positively and avoidance negatively related to investment in ingroups. We integrated frameworks spanning group dynamics and close relationships to contribute to a more comprehensive understanding of how individuals perceive their relationships with ingroups.     

Representation of Game Algebras

We prove that every abstractly defined game algebra can be represented as an algebra of consistent pairs of monotone outcome relations over a game board. As a corollary we obtain Goranko's result that van Benthem's conjectured axiomatization for equivalent game terms is indeed complete.     

Trust and trustworthiness in a sequential bargaining game

We use a two‐person extensive form bargaining game to explore individuals' trusting and reciprocal behavior and how those relate to their scores on a trust survey. In keeping with prior research, we find that the ‘self‐interested’ outcome is rejected by a majority of individuals. People who score high on the trust survey are both trusting and are also trustworthy, in that they reciprocate others' trust. But people with low‐trust scores often exhibit trust but are not trustworthy. These ‘inconsistent trusters’ seem to be interested in exploiting the trust and trustworthiness of others in increasing their own payoff. Copyright © 2003 John Wiley & Sons, Ltd.     

Focusing failures in competitive environments: explaining decision errors in the Monty Hall game,the Acquiring a Company problem,and multiparty ultimatums

This paper offers a unifying conceptual explanation for failures in competitive decision making across three seemingly unrelated tasks: the Monty Hall game (Nalebuff, 1987), the Acquiring a Company problem (Samuelson & Bazerman, 1985), and multiparty ultimatums (Messick, Moore, & Bazerman, 1997). We argue that the failures observed in these three tasks have a common root. Specifically, due to a limited focus of attention, competitive decision makers fail properly to consider all of the information needed to solve the problem correctly. Using protocol analyses, we show that competitive decision makers tend to focus on their own goals, often to the exclusion of the decisions of the other parties, the rules of the game, and the interaction among the parties in light of these rules. In addition, we show that the failure to consider these effects explains common decision failures across all three games. Finally, we suggest that this systematic focusing error in competitive contexts can serve to explain and improve our understanding of many additional, seemingly disparate, competitive decision‐making failures. Copyright © 2003 John Wiley & Sons, Ltd.     

A generic and efficient emotion-driven approach toward personalized assessment and adaptation in serious games

Emotions have a major role in the player-game interaction. In serious games playing contexts, real-time assessment of the player’s emotional state is crucially important to enable an emotion-driven adaptation during gameplay. In addition, a personalized assessment and adaptation based on the player's characteristics remains a challenge for serious games designers. This paper presents a generic and efficient emotion-driven approach for personalized assessment and adaptation in serious games, in which two main methods and their algorithms are proposed. The first one is a method for assessing, in real time, the player's emotion taking into account the personality type and the playing style of the player. The second one is an emotion-driven personalized adaptation method based on Markov modeling of dependency between the serious game events and the change in the player's emotional state. Therefore, the proposed approach has been evaluated by playing an affective vs. non-affective version of a serious game that we have developed to illustrate the applicability of the above-mentioned methods. The overall results showed that owing to our approach, a serious game become able to enhance its adaptivity toward playing outcomes and improve its overall playability.     

First Among Equals: Hybridization of Cognitive Diagnostic Assessment and Evidence-Centered Game Design

The objective of the present article is to explore differences and similarities between cognitive diagnostic assessment (CDA) and evidence-centered game design (ECgD) in the service of intentional hybridization. Although some testing specialists might argue that both are essentially the same given their origins in principled assessment design and equivalency of measurement models, this view misses differences in their focus and operationalization. Given the strengths of both CDA and ECgD, there is motivation to consider ways in which each can deliberately inform the other. The intentional hybridization of CDA and ECgD has, at least in principle, significant advantages to produce a stronger offspring than either parent alone. The article includes four sections: (1) conceptual differences between CDA and ECgD, (2) conceptual similarities between CDA and ECgD, (3) challenges with CDA and ECgD, including narrowness of cognitive models, fidelity with learning, ocean of data, sensitivity to diverse learners, reliance on multidimensional psychometric models, and how hybridization may help, and (4) implications for educational assessment in the twenty-first century around the globe.     

Exploring cooperation and competition in the Centipede game through verbal protocol analysis

The Centipede game is an abstract model of reciprocal relationships in which two individuals alternate in helping each other at relatively small personal cost. Whereas mutual cooperation can benefit both individuals in the long run, a paradoxical but logically compelling backward induction argument suggests that cooperation is irrational. Empirical studies have reported reliable deviations from the non‐cooperative backward induction solution, but their exclusively quantitative methods allow only a limited range of predefined motives to be explored. Our study uses verbal (‘think aloud’) protocols and qualitative data analysis to identify motives for cooperation in the Centipede game. The results provide little evidence for sophisticated backward induction reasoning. Instead, a wide range of motives emerged, their relative saliences varying according to the stage of the game. Activity bias affected decisions mainly at the beginning of the game, whereas cooperative and altruistic social value orientations most frequently accounted for cooperation towards its natural end.