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Subjective Information Choice Processes

Author

Listed:
  • David Dillenberger

    (University of Pennsylvania)

  • R. Vijay Krishna

    (Florida State University)

  • Philipp Sadowski

    (Duke University)

Abstract

We propose a class of dynamic models that capture subjective (and hence unob-servable) constraints on the amount of information a decision maker can acquire, pay attention to, or absorb, via an Information Choice Process (icp). An icp specifies the information that can be acquired about the payo?-relevant state in the current period, and how this choice a?ects what can be learned in the future. In spite of their generality, wherein icps can accommodate any dependence of the information constraint on the history of information choices and state realizations, we show that the constraints imposed by them are identified up to a dynamic extension of Blackwell dominance. All the other parameters of the model are also uniquely identified. Behaviorally, the model is characterized by a novel recursive application of static properties.

Suggested Citation

  • David Dillenberger & R. Vijay Krishna & Philipp Sadowski, 2020. "Subjective Information Choice Processes," PIER Working Paper Archive 20-021, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    • Handle: RePEc:pen:papers:20-021
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    File URL: https://economics.sas.upenn.edu/system/files/working-papers/20-021%20PIER%20Paper%20Submission.pdf
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    References listed on IDEAS

    as
    1. Faruk Gul & Wolfgang Pesendorfer, 2006. "Random Expected Utility," Econometrica, Econometric Society, vol. 74(1), pages 121-146, January.
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    Cited by:

    1. Youichiro Higashi & Kazuya Hyogo & Norio Takeoka, 2020. "Costly Subjective Learning," KIER Working Papers 1040, Kyoto University, Institute of Economic Research.
    2. Krishna, R. Vijay & Sadowski, Philipp, 2021. "Randomly evolving tastes and delayed commitment," Journal of Mathematical Economics, Elsevier, vol. 92(C), pages 81-94.

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    More about this item

    Keywords

    Dynamic Preferences; Information Choice Process; Dynamic Blackwell Dominance; Rational Inattention; Subjective Markov Decision Process;
    All these keywords.

    JEL classification:

    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General

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