Foundation and identification of multi-attribute Shannon entropy

David Walker-Jones

Games and Economic Behavior, 2025, vol. 150, issue C, 334-355

Abstract: By weakening Shannon's original axioms to allow for attributes of the choice environment to differ in their associated learning costs, this paper provides an axiomatic foundation for Multi-Attribute Shannon Entropy, a natural multi-parameter generalization of Shannon Entropy. Sufficient conditions are also provided for a simple dataset that provides a closed-form solution for the Multi-Attribute Shannon Entropy cost function for information by analyzing stochastic choice data produced by a rationally inattentive agent that is picking between pairs of options when relatively few states of the world have a positive probability of being realized.

Keywords: Rational inattention; Shannon entropy; Perceptual distance (search for similar items in EconPapers)
JEL-codes: D83 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:150:y:2025:i:c:p:334-355

DOI: 10.1016/j.geb.2025.01.006

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