A Sharp Test of the Portability of Expertise

46 Pages Posted: 5 Sep 2015 Last revised: 9 Sep 2016

Etan A. Green

Wharton - Operations, Information and Decisions

Justin M. Rao

Microsoft Research; Microsoft Corporation - Microsoft Research - Redmond

David M. Rothschild

Microsoft Research - NYC

Date Written: September 5, 2016

Abstract

As-if justifications of rationality contend that economic actors approximate optimal behavior through heuristics. We evaluate this contention by observing experts perform a task that is logically isomorphic to — but contextually distinct from — a familiar task in which they are skilled. We find that performance plummets when contextual cues disappear, implying that the expertise we observe on the familiar task is more heuristic than conceptual and does not travel far. Our results provide support for as-if justifications: with experience in a domain, actors develop heuristics that are adaptive in that setting. Our results also delineate bounds on such justifications, showing that heuristics can fail even in contexts with the same logical structure. This observation entails a normative implication for experimental design. If economic actors approximate rationality though context-dependent heuristics, then studies which abstract away contextual cues bias their findings against standard theories of rationality.

Keywords: expertise, field vs. lab, probabilistic judgment

JEL Classification: D81, C91, C93

Suggested Citation

Green, Etan A. and Rao, Justin M. and Rothschild, David M., A Sharp Test of the Portability of Expertise (September 5, 2016). Available at SSRN: https://ssrn.com/abstract=2656268 or http://dx.doi.org/10.2139/ssrn.2656268

Etan A. Green (Contact Author)

Wharton - Operations, Information and Decisions ( email )

Philadelphia, PA 19104
United States

Justin M. Rao

Microsoft Research ( email )

641 Avenue of Americas
7th Floor
New York, NY 11249
United States

Microsoft Corporation - Microsoft Research - Redmond ( email )

Building 99
Redmond, WA
United States

David M. Rothschild

Microsoft Research - NYC ( email )

641 6th Ave., 7th Floor
New York, NY 10011
United States

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