Research

If people know that they may forget information over time, do they strategically respond to their memory decay? I develop a theoretical model of imperfect recall in which a decision-maker optimally shapes memory retention through effort choice. When the decision-maker attempts to recall previously encoded data, the success or failure of recall provides a signal about their own forgetting rate, leading to updated beliefs about memory strength and effort adjustment. This mechanism endogenously generates the spacing effect, a key property of human memory. I test the model's behavioral predictions with a novel laboratory experiment. The results show that participants are aware of their forgetting and choose their costly effort for memorization accordingly. Moreover, after observing negative feedback about their actual memory strength, participants adjust their behavior by choosing a higher effort. These findings suggest that individuals can deliberately manage their memory retention through effort, making imperfect recall an endogenous component of decision-making.

Understanding if and how uncertainty shapes diminishing impatience is central to theories of intertemporal choice. We report the first incentivized experiment that directly compares present bias across certain, risky, and ambiguous monetary outcomes. Relative to certainty, uncertainty attenuates present bias, yielding more stationary choices. Moreover, present bias for certain payments is positively associated with ambiguity aversion. Together, these results suggest that uncertainty systematically interacts with time preferences and caution against models that treat intertemporal choice separable from attitude towards uncertainty.

Why people trust without sufficient information about the trustworthiness of the other is a major puzzle in trust research. Drawing on evolutionary psychology signaling logic, we develop a formal model that offers a novel explanation as to why leaders make this seemingly irrational decision. We demonstrate that leaders can signal superior competence by assuming the risk inherent to trusting. Credibly communicating competence, in turn, leads to improved outcomes for these leaders and their followers alike. We show that signaling is a viable strategy only for leaders with superior competence, who trust precisely because the risk they take renders that signal credible. The effectiveness of the signaling is determined by the leaders’ knowledge of their subordinates’ trustworthiness, the impact of subordinates’ felt trust, and managers’ overconfidence.