Nelson Cowan
- Published in print:
- 1998
- Published Online:
- January 2008
- ISBN:
- 9780195119107
- eISBN:
- 9780199870097
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780195119107.003.0003
- Subject:
- Psychology, Cognitive Psychology
There have been wide-spread disagreements about the nature of short-term memory. What distinguishes it from long-term memory? Is the information in short-term memory forgotten as a function of time ...
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There have been wide-spread disagreements about the nature of short-term memory. What distinguishes it from long-term memory? Is the information in short-term memory forgotten as a function of time (memory decay)? Is it susceptible to a limit in capacity, the number of items that can be held at once? This chapter proposes that there are two mechanisms of short-term memory: the activated portion of long-term memory, and the subset of activated elements that are in the focus of attention. It is suggested that the activated portion has a time limit (as well as being susceptible to interference) whereas the focus of attention has a capacity limit. Some unresolved issues with that approach are discussed, along with the neurophysiology of short-term memory. The commonly-used term “working memory” is conceived as a combination of both short-term memory mechanisms, along with direction from central executive processes.Less
There have been wide-spread disagreements about the nature of short-term memory. What distinguishes it from long-term memory? Is the information in short-term memory forgotten as a function of time (memory decay)? Is it susceptible to a limit in capacity, the number of items that can be held at once? This chapter proposes that there are two mechanisms of short-term memory: the activated portion of long-term memory, and the subset of activated elements that are in the focus of attention. It is suggested that the activated portion has a time limit (as well as being susceptible to interference) whereas the focus of attention has a capacity limit. Some unresolved issues with that approach are discussed, along with the neurophysiology of short-term memory. The commonly-used term “working memory” is conceived as a combination of both short-term memory mechanisms, along with direction from central executive processes.
Pierre Barrouillet and Valérie Camos
- Published in print:
- 2007
- Published Online:
- March 2012
- ISBN:
- 9780198570394
- eISBN:
- 9780191693816
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/acprof:oso/9780198570394.003.0004
- Subject:
- Psychology, Cognitive Psychology
This chapter develops an interpretation of the working memory span task as reflecting the rapid switching of a single, limited capacity attentional resource between the processing element and ...
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This chapter develops an interpretation of the working memory span task as reflecting the rapid switching of a single, limited capacity attentional resource between the processing element and rehearsal of the items for recall. It argues that memory trace is subject to decay over time and demonstrates that when attention is captured by demanding processing tasks that prevent time for rehearsal, the result is poorer memory performance. This view then is of a system in which capacity is limited by time and by attention.Less
This chapter develops an interpretation of the working memory span task as reflecting the rapid switching of a single, limited capacity attentional resource between the processing element and rehearsal of the items for recall. It argues that memory trace is subject to decay over time and demonstrates that when attention is captured by demanding processing tasks that prevent time for rehearsal, the result is poorer memory performance. This view then is of a system in which capacity is limited by time and by attention.
Eric Barthalon
- Published in print:
- 2014
- Published Online:
- November 2015
- ISBN:
- 9780231166287
- eISBN:
- 9780231538305
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231166287.003.0008
- Subject:
- Economics and Finance, Behavioural Economics
This chapter extends the field of application of the theory of psychological time and memory decay to nominal interest rates by looking at their correlation with the perceived rate of nominal growth ...
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This chapter extends the field of application of the theory of psychological time and memory decay to nominal interest rates by looking at their correlation with the perceived rate of nominal growth in eighteen countries. It begins with an overview of the theory of the psychological rate of interest, paying special attention to the psychological symmetry between memory decay and future discounting. It then considers whether the psychological rate of interest computed from the sequence of quarterly nominal GDP growth rates is compatible with U.S. AAA corporate bond yields since 1951. It also presents empirical observations about nominal interest rates and the perceived rate of nominal growth and proceeds to discuss nominal interest rates at the end of the German hyperinflation as well as the application of the theory of the psychological rate of interest to the yield on British Consols during the nineteenth century. It concludes that Maurice Allais's theory of the psychological rate of interest is not compatible with a broader set of empirical data.Less
This chapter extends the field of application of the theory of psychological time and memory decay to nominal interest rates by looking at their correlation with the perceived rate of nominal growth in eighteen countries. It begins with an overview of the theory of the psychological rate of interest, paying special attention to the psychological symmetry between memory decay and future discounting. It then considers whether the psychological rate of interest computed from the sequence of quarterly nominal GDP growth rates is compatible with U.S. AAA corporate bond yields since 1951. It also presents empirical observations about nominal interest rates and the perceived rate of nominal growth and proceeds to discuss nominal interest rates at the end of the German hyperinflation as well as the application of the theory of the psychological rate of interest to the yield on British Consols during the nineteenth century. It concludes that Maurice Allais's theory of the psychological rate of interest is not compatible with a broader set of empirical data.
Eric Barthalon
- Published in print:
- 2014
- Published Online:
- November 2015
- ISBN:
- 9780231166287
- eISBN:
- 9780231538305
- Item type:
- book
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231166287.001.0001
- Subject:
- Economics and Finance, Behavioural Economics
This book applies the neglected theory of psychological time and memory decay of Nobel Prize–winning economist Maurice Allais (1911–2010) to model investors' psychology in the present context of ...
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This book applies the neglected theory of psychological time and memory decay of Nobel Prize–winning economist Maurice Allais (1911–2010) to model investors' psychology in the present context of recurrent financial crises. Shaped by the behavior of the demand for money during episodes of hyperinflation, Allais's theory suggests economic agents perceive the flow of clocks' time and forget the past at a context-dependent pace: rapidly in the presence of persistent and accelerating inflation and slowly in the event of the opposite situation. The book recasts Allais's work as a general theory of “expectations” under uncertainty, narrowing the gap between economic theory and investors' behavior. The text extends Allais's theory to the field of financial instability, demonstrating its relevance to nominal interest rates in a variety of empirical scenarios and the positive nonlinear feedback that exists between asset price inflation and the demand for risky assets. Reviewing the works of the leading protagonists in the expectations controversy, this volume exposes the limitations of adaptive and rational expectations models and, by means of the perceived risk of loss, calls attention to the speculative bubbles that lacked the positive displacement discussed in Charles P. Kindleberger's model of financial crises. It ultimately extrapolates Allaisian theory into a pragmatic approach to investor behavior and the natural instability of financial markets. It concludes with the policy implications for governments and regulators.Less
This book applies the neglected theory of psychological time and memory decay of Nobel Prize–winning economist Maurice Allais (1911–2010) to model investors' psychology in the present context of recurrent financial crises. Shaped by the behavior of the demand for money during episodes of hyperinflation, Allais's theory suggests economic agents perceive the flow of clocks' time and forget the past at a context-dependent pace: rapidly in the presence of persistent and accelerating inflation and slowly in the event of the opposite situation. The book recasts Allais's work as a general theory of “expectations” under uncertainty, narrowing the gap between economic theory and investors' behavior. The text extends Allais's theory to the field of financial instability, demonstrating its relevance to nominal interest rates in a variety of empirical scenarios and the positive nonlinear feedback that exists between asset price inflation and the demand for risky assets. Reviewing the works of the leading protagonists in the expectations controversy, this volume exposes the limitations of adaptive and rational expectations models and, by means of the perceived risk of loss, calls attention to the speculative bubbles that lacked the positive displacement discussed in Charles P. Kindleberger's model of financial crises. It ultimately extrapolates Allaisian theory into a pragmatic approach to investor behavior and the natural instability of financial markets. It concludes with the policy implications for governments and regulators.
Eric Barthalon
- Published in print:
- 2014
- Published Online:
- November 2015
- ISBN:
- 9780231166287
- eISBN:
- 9780231538305
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231166287.003.0007
- Subject:
- Economics and Finance, Behavioural Economics
This chapter illustrates the dynamic properties of the HRL formulation by means of a detailed numerical example based on the hyperinflation observed in Zimbabwe between 2000 and 2008. It first ...
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This chapter illustrates the dynamic properties of the HRL formulation by means of a detailed numerical example based on the hyperinflation observed in Zimbabwe between 2000 and 2008. It first presents the results of dynamic equilibrium and dynamic disequilibrium simulations. It shows that the perceived rate of inflation converged asymptotically toward the instantaneous rate of inflation. This asymptotic convergence happens because the rate of memory decay grows exponentially and the elasticity of the perceived rate of inflation with respect to the instantaneous rate of inflation converges toward unity. The duration of the memory of inflation is also computed, along with the distribution of forecasting errors in the HRL formulation. Finally, the chapter examines how the HRL formulation sheds light on what Charles P. Kindleberger calls “some historical puzzles in macroeconomic behavior”.Less
This chapter illustrates the dynamic properties of the HRL formulation by means of a detailed numerical example based on the hyperinflation observed in Zimbabwe between 2000 and 2008. It first presents the results of dynamic equilibrium and dynamic disequilibrium simulations. It shows that the perceived rate of inflation converged asymptotically toward the instantaneous rate of inflation. This asymptotic convergence happens because the rate of memory decay grows exponentially and the elasticity of the perceived rate of inflation with respect to the instantaneous rate of inflation converges toward unity. The duration of the memory of inflation is also computed, along with the distribution of forecasting errors in the HRL formulation. Finally, the chapter examines how the HRL formulation sheds light on what Charles P. Kindleberger calls “some historical puzzles in macroeconomic behavior”.
Julia Partheymüller
- Published in print:
- 2017
- Published Online:
- November 2017
- ISBN:
- 9780198792130
- eISBN:
- 9780191834295
- Item type:
- chapter
- Publisher:
- Oxford University Press
- DOI:
- 10.1093/oso/9780198792130.003.0002
- Subject:
- Political Science, Comparative Politics
It is widely believed that the news media have a strong influence on defining what are the most important problems facing the country during election campaigns. Yet, recent research has pointed to ...
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It is widely believed that the news media have a strong influence on defining what are the most important problems facing the country during election campaigns. Yet, recent research has pointed to several factors that may limit the mass media’s agenda-setting power. Linking news media content to rolling cross-section survey data, the chapter examines the role of three such limiting factors in the context of the 2009 and the 2013 German federal elections: (1) rapid memory decay on the part of voters, (2) advertising by the political parties, and (3) the fragmentation of the media landscape. The results show that the mass media may serve as a powerful agenda setter, but also demonstrate that the media’s influence is strictly limited by voters’ cognitive capacities and the structure of the campaign information environment.Less
It is widely believed that the news media have a strong influence on defining what are the most important problems facing the country during election campaigns. Yet, recent research has pointed to several factors that may limit the mass media’s agenda-setting power. Linking news media content to rolling cross-section survey data, the chapter examines the role of three such limiting factors in the context of the 2009 and the 2013 German federal elections: (1) rapid memory decay on the part of voters, (2) advertising by the political parties, and (3) the fragmentation of the media landscape. The results show that the mass media may serve as a powerful agenda setter, but also demonstrate that the media’s influence is strictly limited by voters’ cognitive capacities and the structure of the campaign information environment.
Eric Barthalon
- Published in print:
- 2014
- Published Online:
- November 2015
- ISBN:
- 9780231166287
- eISBN:
- 9780231538305
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231166287.003.0012
- Subject:
- Economics and Finance, Behavioural Economics
This book concludes by summarizing the key arguments in the form of a comparison of the HRL formulation with the rational expectations hypothesis (REH). It explains what makes Maurice Allais's ...
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This book concludes by summarizing the key arguments in the form of a comparison of the HRL formulation with the rational expectations hypothesis (REH). It explains what makes Maurice Allais's contribution original, important, and modern. To start with, many of the rational expectations theorists' criticisms of standard adaptive expectations do not apply to the HRL formulation. The HRL formulation is much more sophisticated and much more rational than the standard adaptive expectations model tolerated by the REH advocates when economic variables are interdependent. Furthermore, the variability of the rate of memory decay is endogenous both to economic agents and to the environment they are responding to. Parsimony, nonlinearity and time variability of the gain, unequal weighting of past observations according to a well-specified and stable law of forgetting, absence of patterns in forecasting errors—these are the features that make Allais's HRL formulation worth the consideration of economists wishing to explore or to revisit the unsettled and important question of “expectations” formation.Less
This book concludes by summarizing the key arguments in the form of a comparison of the HRL formulation with the rational expectations hypothesis (REH). It explains what makes Maurice Allais's contribution original, important, and modern. To start with, many of the rational expectations theorists' criticisms of standard adaptive expectations do not apply to the HRL formulation. The HRL formulation is much more sophisticated and much more rational than the standard adaptive expectations model tolerated by the REH advocates when economic variables are interdependent. Furthermore, the variability of the rate of memory decay is endogenous both to economic agents and to the environment they are responding to. Parsimony, nonlinearity and time variability of the gain, unequal weighting of past observations according to a well-specified and stable law of forgetting, absence of patterns in forecasting errors—these are the features that make Allais's HRL formulation worth the consideration of economists wishing to explore or to revisit the unsettled and important question of “expectations” formation.
