Matthew Rabin | |
|---|---|
 Rabin in 2008 | |
| Born | (1963-12-27)December 27, 1963 (age 62) |
| Academic background | |
| Alma mater | University of Wisconsin–Madison MIT |
| Doctoral advisor | Drew Fudenberg[1] |
| Academic work | |
| Discipline | Behavioral economics,Game theory |
| Doctoral students | Gary Charness[2] Jeffrey C. Ely[3] |
| Notable ideas | Cursed equilibrium,Rabin fairness,Rabin's paradox |
| Awards | John Bates Clark Medal John von Neumann Award |
| Website | |
Matthew Joel Rabin (/ˈreɪbɪn/;[4] born December 27, 1963) is an American economist. He is the Pershing Square Professor ofBehavioral Economics in the Harvard Economics Department andHarvard Business School. Rabin's research focuses primarily on incorporating psychologically more realistic assumptions into empirically applicable formal economic theory. His topics of interest include errors in statistical reasoning and the evolution of beliefs, effects of choice context on exhibited preferences, reference-dependent preferences, and errors people make in inference in market and learning settings.[5][6]
Rabin was the Edward G. and Nancy S. Jordan Professor of Economics at the University of California, Berkeley Economics Department for 25 years before moving to Harvard.[5][7] He received aBachelor of Arts inEconomics andMathematics fromUniversity of Wisconsin–Madison in 1984 andPhD inEconomics fromMIT in 1989.[8] Before entering MIT, he was a research student at theLondon School of Economics.[5] He is a member of the Russell Sage Foundation Behavioral Economics Roundtable and co-organizer of the Russell Sage Summer Institute in Behavioral Economics.[8] Rabin has also been a visiting professor at M.I.T., London School of Economics, Northwestern, Harvard, and Caltech, and a visiting scholar at the Center for Advanced Study in Behavioral Sciences at Stanford, and the Russell Sage Foundation.[5][8]
Rabin's research is directed towardsgame theory andbehavioral economics. Rabin works on the economics of individual self-control problems, reference-dependent preferences, fairness motives and mistakes in probabilistic reasoning. He developedRabin fairness as a model to account for fairness in social preferences. In 2001, he was awarded theJohn Bates Clark Medal by theAmerican Economic Association[9] and also theMacArthur "Genius" Fellowship.[8] In 2006, he was awarded theJohn von Neumann Award by theRajk László College for Advanced Studies.[8]
Between 2006 and 2009,[10][11][12] Rabin together with economistBotond Kőszegi published a series of papers elaborating on the idea ofreference dependence inProspect Theory, according to which monetary and hedonic prizes are evaluated in relation to a reference point, whereby losses loom larger than gains. In Kőszegi and Rabin's version, the reference point is determined by prior expectations of consumption. In this model, plans for future consumption both affect the future reference point, and are determined to maximize the agent's experience given that reference point. This necessitates the invocation ofpersonal equilibrium, a concept which applies game-theoretic notions of equilibrium to single-agent settings where decision-making is reflexive. The 2009 paper extends the model to dynamic settings where information about future consumption is gradually revealed. Kőszegi and Rabin introduce the notion ofnews utility—the pleasure or displeasure experienced when a person learns new information about their future hedonic experience.
