At LEEPS we emphasize the laboratory study of learning processes within various institutions, including markets, multiplayer games and individual choice tasks. In the laboratory the institution can be varied in a systematic manner, and information and payoffs can be observed, permitting sharp tests of learning models. Such laborarory work is complementary to analysis of field evidence, computer simulations and model construction emphasized by many other researchers.
The US National Science Foundation has provided core funding for LEEPS under a series of grants listed below. Additional grants have come from HP Labs and from The Environmental Defense Fund.
Supplementary funds have come from UCSC sources (including the Economics Department, Social Sciences Division and the Academic Senate) and private sources, including Netgear. Our thanks to all our sponsors!
Our Current Projects - NSF Grants ''Preferences and Equilibrium in Laboratory Financial Markets" SES-1357867, "Economic Analysis of Recommender Systems" CCF-1101741, and the HP Open Innovation Grant "Boiling the Frog Optimally: A Laboratory Experiment".
Completed Projects - NSF Grants SES-0925039 (2008-2012), SBR-0351801 (2004-08), SES-0436509 (2005-08), IIS-0527770 (2006-09), SES84-11382, IRI88-12798, SES90-23945, DUE-9351763, SBR-9223461, SBR-9310347, SBR-9617917, and IIS-9986651.
Our research partners have included the following institutions:
- Visual Math Institute
- Information Retrieval and Knowledge Management Lab at UCSC
- Experimental Economics Lab at GSU
- Almaden Services Research
- Computable & Experimental Economics Lab (CEEL), Trento
- Information Dynamics Laboratory, HP Labs
- UCSC Perceptual Science Laboratory
- Santa Fe Institute
Other Economics Links
- Economic Science Association
- Al Roth's Game Theory and Experimental Economics Page
- Resources for Economists on the Internet
- SIEC (Social Interaction Economics & Computing)
- California Social Science and Experimental Laboratory
- The Science Lab website - Economics resources
- Eco5 - Research portal for finance and economics
- ESA Experimental Methods Discussion Group
A Manifestino On Learning and Economics
The casual visitor could easily get the impression that the diverse projects at LEEPS are disconnected. Not so. Most spring from a common intellectual ground, a blend of economic theory with some aspects of evolution and psychology. Here is the logic.
Economists have a well defined theoretical approach. Individual people are self-interested utility maximizers who interact through markets, and the markets produce equilibrium outcomes. This optimization/equilibrium approach has enjoyed considerable success in explaining the general tendencies of most goods markets. It has been widely extended, with mixed success, to a variety of settings in economics and other social sciences.
The optimization/equilibrium approach has two fundamental deficiencies, one theoretical and the other practical. The approach lacks a theoretical account of how equilibrium becomes established, and therefore it offers no convincing way of choosing among multiple equilibria. The practical deficiency is that it offers no guidance as to when actual outcomes will closely approximate equilibrium outcomes. Hence the pattern of success and failure in explaining labor markets, macroeconomics, law, politics, etc., often surprises its supporters as well as its critics.
Evolutionary processes provide a complementary approach that promises to remedy the deficiencies in the equilibrium/optimization approach and to re-unify economics with its sister social sciences. Evolutionary processes operate on three distinct time scales. Individual learning is the most rapid. Given facilitating market and other social institutions, learning will rapidly and reliably produce outcomes close to equilibrium. Thus utility maximization and equilibrium should be thought of as the end result of a learning dynamic shaped by efficient social institutions. Unfortunately, social institutions evolve on a slower time scale and not always towards the efficient institutions. Our basic human nature as social creatures shapes the evolution of our institutions, and it in turn is subject to the slow force of genetic evolution. Thus the optimization/equilibrium approach will not always offer a reasonable approximation to actual outcomes.
Much empirical and theoretical work will be necessary for the learning/evolution approach to realize its promise. Psychologists' learning models and data traditionally ignored the impact of institutions on equilibrating tendencies. Anthropologists and other social scientists who study social institutions have traditionally shied away from explicit evolutionary analysis. Sociobiologists tended to conflate social and genetic evolution. Fortunately, recent trends in these disciplines are more compatible with learning and evolution, and an interdisciplinary fusion may well be in progress.
At LEEPS we emphasize the laboratory study of learning processes within various institutions, and focus on their equilibrating tendencies. In the laboratory the institution can be varied in a systematic manner and information and payoffs can be observed, permitting much sharper tests of learning models than field evidence. But field evidence will also be required to check for external validity and to observe social evolution at work. New model construction will certainly be in order as evidence accumulates on current models. Computer simulation will become an increasingly important part of model construction and analysis. Thus our work at LEEPS is complementary to that of many other researchers. See the list of affiliated institutions and drop us a line if your research program connects to ours.
by Dan Friedman/LEEPS Lab 5/96 and lightly edited 2011