A theory of subjective learning

David Dillenberger, Juan Sebastián Lleras, Philipp Sadowski and Norio Takeoka

Journal of Economic Theory, 2014, vol. 153, issue C, 287-312

Abstract: We study an individual who faces a dynamic decision problem in which the process of information arrival is unobserved by the analyst. We elicit subjective information directly from choice behavior by deriving two utility representations of preferences over menus of acts. One representation uniquely identifies information as a probability measure over posteriors and the other identifies information as a partition of the state space. We compare individuals who expect to learn differently in terms of their preference for flexibility. On the extended domain of dated-menus, we show how to accommodate gradual learning over time by means of a subjective filtration.

Keywords: Subjective learning; Partitional learning; Preference for flexibility; Valuing insurance acts; Subjective filtration; Dated-menus (search for similar items in EconPapers)
JEL-codes: D80 D81 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (30)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:153:y:2014:i:c:p:287-312

DOI: 10.1016/j.jet.2014.07.003

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