Economic theories of optimism provide different rationales for the phenomenon motivated reasoning, and a recent empirical literature has tested some them, with mixed results. We contribute to this novel experimental test two mechanisms, according which is respectively predicted when (1) potential material losses due bias are relatively small or (2) cognitive costs enough. In our design, these a...

This paper examines whether the individual economic projections made by Federal Open Market Committee’s (FOMC) policymakers are consistent with macroeconomic theories: Okun’s law, Phillips curve, and Taylor rule. By analyzing FOMC’s between 2007 2014, I find that they revealing a significantly negative relationship unemployment output growth projections. On other hand, inflation associated curv...

Human populations differ reliably in the degree to which people favor family, friends, and community members over strangers and outsiders. In the last decade, researchers have begun to propose several economic and evolutionary hypotheses for these cross-population differences in parochialism. In this paper, we outline major current theories and review recent attempts to test them. We also discu...

For more than forty years, economists have routinely rejected the postulate that economic theory should be realistic. Ever since Milton Friedman sketchily outlined a positive methodology for economics, most students of our science have come to endorse Friedman’s view and have claimed that the only quality standard of economic reasoning was its predictive power. Good theories yield fairly correc...