Choice under Markovian Constraints
AbstractIn this paper I provide a descriptive model of choice over time by a population of constrained maximizing agents. Agents’ choice sets are markovian in the sense that they depend on previous choices. The unperturbed dynamics turns out to be trapped into local maxima whatever the length of memory. In the presence of perturbations efficiency is got with a memory of at least two periods. This provides a useful insight for what drives to efficient evolution in this setting: perturbations create variety and a two period long memory allows comparisons and selection
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Bibliographic InfoPaper provided by Department of Economics, University of Siena in its series Department of Economics University of Siena with number 516.
Date of creation: Oct 2007
Date of revision:
personal experience; limited cognitive capabilities; stochastically stable distribution;
Find related papers by JEL classification:
- D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-11-17 (All new papers)
- NEP-CBE-2007-11-17 (Cognitive & Behavioural Economics)
- NEP-DCM-2007-11-17 (Discrete Choice Models)
- NEP-EVO-2007-11-17 (Evolutionary Economics)
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