Optimal Sequential Decision with Limited Attention
Economics
Speaker: | Konrad Mierendorff, University College London |
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Date: | Friday 23 March 2018 |
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Time: | 3.30pm |
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Location: | Kolade Teaching Room |
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Further details
We consider a dynamic model of information acquisition. Before taking an action, a decision maker may direct her limited attention to collecting different types of evidence that support alternative actions. The optimal policy combines three strategies: (i) immediate action, (ii) a contradictory strategy seeking to challenge the prior belief, and (iii) a confirmatory strategy seeking to confirm the prior. The model produces a rich dynamic stochastic choice pattern as well as predictions in
settings such as jury deliberation and political media choice. Keywords: Wald sequential decision problem, choice of information, contradictory and confirmatory learning strategies, limited attention