Following beliefs or excluding the worst? The role of unfindable state in learning
Tatiana Mayskaya
European Economic Review, 2024, vol. 162, issue C
Abstract:
An agent learns in continuous time from two information sources, each associated with a hypothesis. If a hypothesis is true, the associated source confirms it at a positive rate. False hypotheses are never confirmed. Among the two hypotheses, either exactly one is true or both are false. The agent’s optimal learning strategy has two phases. During the first phase, the agent follows his beliefs; that is, at each moment, he learns from the source associated with the most likely hypothesis according to his current beliefs. During the second phase, he focuses on excluding the least likely but more important hypothesis.
Keywords: Dynamic information acquisition; Poisson process; Limited attention; Search (search for similar items in EconPapers)
JEL-codes: D83 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:
Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292123002817
Full text for ScienceDirect subscribers only
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:162:y:2024:i:c:s0014292123002817
DOI: 10.1016/j.euroecorev.2023.104653
Access Statistics for this article
European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer
More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Catherine Liu (repec@elsevier.com).