Plans of Action
We introduce a decision theoretic foundation for a class of learning models in which thedecision maker's beliefs over the present uncertainty is dictated by the outcomes of herpast actions. This type of learning underlies models of strategic experimentation. Weconstruct a framework in which an alternative is a recursive function contingent at anystage on the outcomes of previous actions, and provide axiomatizations for subjectivediscounted expected utility maximization, both for independent actions and correlatedactions. We point out that models of strategic experimentation have inherent limitedobservability, which in turn leads to partial identification of the subjective belief structure. We show that a class of processes we refer to as strongly exchangeable are the fullcharacterization of Bayesianism in such environments.
|Date of creation:||Jan 2016|
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Web page: http://www.econ.pitt.edu/
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- Cooke, Kevin, 2017. "Preference discovery and experimentation," Theoretical Economics, Econometric Society, vol. 12(3), September.
- Epstein, Larry G. & Seo, Kyoungwon, 2010.
"Symmetry of evidence without evidence of symmetry,"
Econometric Society, vol. 5(3), September.
- Larry G. Epstein & Kyoungwon Seo, 2008. "Symmetry Of Evidence Without Evidence Of Symmetry," Boston University - Department of Economics - Working Papers Series wp2008-018, Boston University - Department of Economics.
- Piermont, Evan & Takeoka, Norio & Teper, Roee, 2016. "Learning the Krepsian state: Exploration through consumption," Games and Economic Behavior, Elsevier, vol. 100(C), pages 69-94.
- Dekel, Eddie & Lipman, Barton L & Rustichini, Aldo, 2001. "Representing Preferences with a Unique Subjective State Space," Econometrica, Econometric Society, vol. 69(4), pages 891-934, July.
- Eddie Dekel, 1997. "A Unique Subjective State Space for Unforeseen Contingencies," Discussion Papers 1202, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Kreps, David M, 1979. "A Representation Theorem for "Preference for Flexibility"," Econometrica, Econometric Society, vol. 47(3), pages 565-577, May.
- R. Vijay Krishna & Philipp Sadowski, 2014. "Dynamic Preference for Flexibility," Econometrica, Econometric Society, vol. 82(2), pages 655-703, 03.
- Faruk Gul & Wolfgang Pesendorfer, 2004. "Self-Control and the Theory of Consumption," Econometrica, Econometric Society, vol. 72(1), pages 119-158, 01.
- W. Pesendorfer & F. Gul, 1999. "Self-Control and the Theory of Consumption," Princeton Economic Theory Papers 99f2, Economics Department, Princeton University.
- Epstein Larry G. & Le Breton Michel, 1993. "Dynamically Consistent Beliefs Must Be Bayesian," Journal of Economic Theory, Elsevier, vol. 61(1), pages 1-22, October.
- Dillenberger, David & Lleras, Juan Sebastián & Sadowski, Philipp & Takeoka, Norio, 2014. "A theory of subjective learning," Journal of Economic Theory, Elsevier, vol. 153(C), pages 287-312.
- Hyogo, Kazuya, 2007. "A subjective model of experimentation," Journal of Economic Theory, Elsevier, vol. 133(1), pages 316-330, March. Full references (including those not matched with items on IDEAS)
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