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Essays on Costly Deliberation

出版	Boston University, 2009
URL	http://books.google.com.hk/books?id=GhUdtAEACAAJ&hl=&source=gbs_api

註釋Abstract: The three chapters consider various models of bounded rationality: 1. Competitive problem solving. Agents compete to solve a problem. Each agent's strategy choice is a problem-solving method and only the agent who solves the problem first gets a positive payoff. There are two qualitatively different problem solving strategies, search and deliberation. Under search, the agent finds a solution with a certain probability at each date independent of his ability. On the other hand, in deliberation, the agent finds the solution with certainty after he deliberates a certain amount of time where this time is private information. I show that there exists a unique symmetric equilibrium where only those types "smarter" than a certain level deliberate and all less smart types use search. I also show that when the problem is sufficiently difficult, then competition forces moderately smart types to play a speculative problem solving strategy and brings inefficiency. 2. Time to think and the negative effect of competition. Agents compete to acquire a limited economic opportunity of uncertain profitability. On the other hand, agents take time to process available information about the opportunity. How much information do agents utilize before trying to acquire the opportunity? I analyze this problem as a strategic optimal stopping problem where each agent decides when he stops utilizing information. The equilibria have various levels of efficiency under mild competition. However, when competitive pressure is sufficiently high, there is less time to process information leading to worse decisions. As a consequence, under strong competition, all equilibria have the lowest possible efficiency. 3. Complementarity of behavioral biases. I investigate the complementarity of behavioral biases in intertemporal decisions. The agent has incomplete knowledge about a correlation between fitness and the decision environment. Nature endows the agent with a decision procedure so that the induced action can reflect this correlation. I show that the agent with this decision procedure always exhibits (i) present biased time preference, (ii) distorted belief and (iii) cognitive dissonance. The three biases are complements and the absence of one of them destroys the value of the other two. [PUBLICATION ABSTRACT]