scholarly journals Constrained versus Unconstrained Rational Inattention

Games ◽  
2021 ◽  
Vol 12 (1) ◽  
pp. 3
Author(s):  
Yaron Azrieli

The rational inattention literature is split between two versions of the model: in one, mutual information of states and signals are bounded by a hard constraint, while, in the other, it appears as an additive term in the decision maker’s utility function. The resulting constrained and unconstrained maximization problems are closely related, but, nevertheless, their solutions differ in certain aspects. In particular, movements in the decision maker’s prior belief and utility function lead to opposite comparative statics conclusions.

2007 ◽  
Vol 39 (9) ◽  
pp. 2248-2270 ◽  
Author(s):  
Wei-Bin Zhang

The author develops a multiregional growth model with endogenous amenity and capital accumulation for any number of regions. The simulation results demonstrate that the national dynamics have a unique equilibrium. Comparative statics analysis shows that, if environmental improvement occurs in the technologically advanced (less advanced) region, the national output rises (falls). As a region improves its technology, the other two regions' aggregated output levels fall—not only in relative, but also in absolute, terms. This implies that if any region has a high rate of technological change and the other regions remain technologically stationary, then economic activities will tend to be concentrated in the technologically advancing region. It is also shown that technological differences appear to play only a small role in accounting for spatial wage disparities and endowments.


2021 ◽  
Vol 13 (1) ◽  
Author(s):  
Corinna Keup ◽  
Vinay Suryaprakash ◽  
Siegfried Hauch ◽  
Markus Storbeck ◽  
Peter Hahn ◽  
...  

Abstract Background Single liquid biopsy analytes (LBAs) have been utilized for therapy selection in metastatic breast cancer (MBC). We performed integrative statistical analyses to examine the clinical relevance of using multiple LBAs: matched circulating tumor cell (CTC) mRNA, CTC genomic DNA (gDNA), extracellular vesicle (EV) mRNA, and cell-free DNA (cfDNA). Methods Blood was drawn from 26 hormone receptor-positive, HER2-negative MBC patients. CTC mRNA and EV mRNA were analyzed using a multi-marker qPCR. Plasma from CTC-depleted blood was utilized for cfDNA isolation. gDNA from CTCs was isolated from mRNA-depleted CTC lysates. CTC gDNA and cfDNA were analyzed by targeted sequencing. Hierarchical clustering was performed within each analyte, and its results were combined into a score termed Evaluation of multiple Liquid biopsy analytes In Metastatic breast cancer patients All from one blood sample (ELIMA.score), which calculates the contribution of each analyte to the overall survival prediction. Singular value decomposition (SVD), mutual information calculation, k-means clustering, and graph-theoretic analysis were conducted to elucidate the dependence between individual analytes. Results A combination of two/three/four LBAs increased the prevalence of patients with actionable signals. Aggregating the results of hierarchical clustering of individual LBAs into the ELIMA.score resulted in a highly significant correlation with overall survival, thereby bolstering evidence for the additive value of using multiple LBAs. Computation of mutual information indicated that none of the LBAs is independent of the others, but the ability of a single LBA to describe the others is rather limited—only CTC gDNA could partially describe the other three LBAs. SVD revealed that the strongest singular vectors originate from all four LBAs, but a majority originated from CTC gDNA. After k-means clustering of patients based on parameters of all four LBAs, the graph-theoretic analysis revealed CTC ERBB2 variants only in patients belonging to one particular cluster. Conclusions The additional benefits of using all four LBAs were objectively demonstrated in this pilot study, which also indicated a relative dominance of CTC gDNA over the other LBAs. Consequently, a multi-parametric liquid biopsy approach deconvolutes the genomic and transcriptomic complexity and should be considered in clinical practice.


2021 ◽  
Vol 111 (10) ◽  
pp. 3225-3255
Author(s):  
Benjamin Hébert ◽  
Michael Woodford

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)


2012 ◽  
Vol 10 (1) ◽  
Author(s):  
Oksana Loginova

Abstract The existing theoretical literature on mass customization maintains that customization reduces product differentiation and intensifies price competition. In contrast, operations management studies argue that customization serves primarily to differentiate a company from its competitors. Interactive involvement of the customer in product design creates an affective relationship with the firm, relaxing price competition. This paper provides a model that incorporates consumer involvement to explain the phenomena described in the operations management literature.Two firms on the Hotelling line compete for a continuum of consumers with heterogeneous brand preferences. An exogenously given fraction of consumers is potentially interested in customization. Consumer benefits from customization are the rewards from a special shopping experience and the value of product customization (a better fitting product); these benefits are higher for consumers located closer to the customizing brand. When a consumer purchases a customized product, he/she incurs waiting costs. Each firm simultaneously decides whether to offer standard products, customized products, or both, and then engage in price competition. I show that customization increases product differentiation, leading to less intense price competition. Depending on the parameter values, in equilibrium either both firms offer customized products, one firm offers customized products and the other standard and customized products, or one firm offers customized products and the other standard products. I perform comparative statics analysis with respect to the fraction of consumers interested in customization, the waiting costs, and the fixed cost of customization.


2009 ◽  
Vol 57 (2) ◽  
pp. 137-147
Author(s):  
Marie Allard ◽  
Camille Bronsard ◽  
Gilles McDougall

ABSTRACT While the meaningful theorems of neo-classical theory of the producer are well known, the neo-keynesian counterparts are not. Therefore, this paper will present those new meaningful theorems and their relations with neo-classical theory. On the one hand, this paper is of interest to the theoretician who would want to use the properties of comparative statics of the producer with quantitative rationing. On the other hand, since a neo-keynesian structural form is presented, the econometrician will be interested in imposing the meaningful theorems of this theory as a priori restrictions.


Author(s):  
M. D. MADULARA ◽  
P. A. B. FRANCISCO ◽  
S. NAWANG ◽  
D. C. AROGANCIA ◽  
C. J. CELLUCCI ◽  
...  

We investigate the pairwise mutual information and transfer entropy of ten-channel, free-running electroencephalographs measured from thirteen subjects under two behavioral conditions: eyes open resting and eyes closed resting. Mutual information measures nonlinear correlations; transfer entropy determines the directionality of information transfer. For all channel pairs, mutual information is generally lower with eyes open compared to eyes closed indicating that EEG signals at different scalp sites become more dissimilar as the visual system is engaged. On the other hand, transfer entropy increases on average by almost two-fold when the eyes are opened. The largest one-way transfer entropies are to and from the Oz site consistent with the involvement of the occipital lobe in vision. The largest net transfer entropies are from F3 and F4 to almost all the other scalp sites.


2018 ◽  
Vol 30 (2) ◽  
pp. 117-127
Author(s):  
António Osório

This article attempts to explain the behaviour observed in the dictator game without explicitly assuming a utility function. Alternatively, I consider the repre- sentative behaviour of a society composed of heterogeneous individuals in terms of altruism and self-interest. Based on these two principles, I present an allocation that aggregates the society's preferences. The result depends crucially on the value of the resource under dispute for the dictator. Even if the value of the resource is extremely important for the dictator, the dictator cannot justify a share of the resource larger than 3/4 of the total. An allocation proposing more than this share of the resource cannot reach social consensus. On the other extreme, if the value of the resource is sufficiently unimportant for the society, an equal split of the resource emerges in the limit.


Author(s):  
Ryotaro Kamimura ◽  

In this paper, we propose new information-theoretic methods to stabilize feature detection. We have introduced information-theoretic methods to realize competitive learning. It turned out that mutual information maximization corresponds to a process of competition among neurons. This means that mutual information can be effective in describing competitive processes. Thus, by using this mutual information, we have introduced information loss to interpret internal representations. By relaxing competitive units by some components such as units and connection weights, a neural network’s information is decreased. If the information loss is sufficiently large, the components play important roles. However, with the information loss, there have been some problems, such as the instability of final representations. This means that final outputs are significantly dependent upon chosen parameters. To stabilize final representations, we introduce two computational methods, that is, <em>relative relaxation</em> and <em>weighted information loss</em>. The relative relaxation is introduced because mutual information is dependent upon the Gaussian width. Thus, we can relax competitive units or softly delete some components, relative only to a predetermined base state. In addition, we introduce weighted information loss to take into account information on related components. We applied the methods to the well-known Iris problem and a problem regarding the extinction of animals and plants. In the Iris problem, experimental results confirmed that final representations were significantly stable if we appropriately chose the parameter for the base state. On the other hand, in the extinction problem, weighted information losses showed better performance, where final outputs were significantly more stable than those by the other methods.


2018 ◽  
Vol 14 (6) ◽  
pp. 155014771878145
Author(s):  
Su-Jin Lee ◽  
Young-Jin Park ◽  
Han-Lim Choi

This article addresses information-based sensing point selection from a set of possible sensing locations. A potential game approach has been applied to addressing distributed decision making for cooperative sensor planning. For a large sensor network, the local utility function for an agent is difficult to compute, because the utility function depends on the other agents’ decisions, while each sensing agent is inherently faced with limitations in both its communication and computational capabilities. Accordingly, we propose an approximation method for a local utility function to accommodate limitations in information gathering and processing, using only a part of the decisions of other agents. The error induced by the approximation is also analyzed, and to keep the error small, we propose a selection algorithm that chooses the neighbor set for each agent in a greedy way. The selection algorithm is based on the correlation between one agent’s and the other agents’ measurement selection. Furthermore, we show that a game with an approximate utility function has an [Formula: see text]equilibrium and the set of the equilibria include the Nash equilibrium of the original potential game. We demonstrate the validity of our approximation method through two numerical examples on simplified weather forecasting and multi-target tracking.


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