Categorical Screening with Rational Inattention

2020 ◽  
Author(s):  
Mogens Fosgerau ◽  
Rajiv Sethi ◽  
Jorgen W. Weibull
Keyword(s):  
Rational Inattention

Rational Inattention and Dynamics of Consumption and Wealth in General Equilibriumm

2016 ◽  
Author(s):  
Yulei Luo ◽  
Jun Nie ◽  
Gaowang Wang ◽  
Eric R. Young
Keyword(s):  
Rational Inattention

Neighborhood-Based Information Costs

2021 ◽  
Vol 111 (10) ◽  
pp. 3225-3255
Author(s):  
Benjamin Hébert ◽  
Michael Woodford
Keyword(s):  
Mutual Information ◽  
Topological Structure ◽  
Cost Functions ◽  
Binary Choice ◽  
Information Costs ◽  
Linear Quadratic ◽  
Rational Inattention ◽  
Linear Quadratic Gaussian ◽  
Perceptual Judgments ◽  
Perceptual Distance

We derive a new cost of information in rational inattention problems, the neighborhood-based cost functions, starting from the observation that many settings involve exogenous states with a topological structure. These cost functions are uniformly posterior separable and capture notions of perceptual distance. This second property ensures that neighborhood-based costs, unlike mutual information, make accurate predictions about behavior in perceptual experiments. We compare the implications of our neighborhood-based cost functions with those of the mutual information in a series of applications: perceptual judgments, the general environment of binary choice, regime-change games, and linear-quadratic-Gaussian settings. (JEL C70, D11, D82, D83, D91)

Persuasion with Rational Inattention

2018 ◽  
Author(s):  
Alexander W. Bloedel ◽  
Ilya Segal
Keyword(s):  
Rational Inattention
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