Related papers: On Directed Information and Gambling
We formulate an adaptive version of Kelly's horse model in which the gambler learns from past race results using Bayesian inference. A known asymptotic scaling for the difference between the growth rate of the gambler and the optimal growth…
We study how cursedness, the tendency to neglect how other people's strategies depend on their private information, affects information transmission in Spence's job market signaling game. We characterize the Cursed Sequential Equilibrium…
In an intelligent transportation system, the effects and relations of traffic flow at different points in a network are valuable features which can be exploited for control system design and traffic forecasting. In this paper, we define the…
Probabilities of causation are fundamental to individual-level explanation and decision making, yet they are inherently counterfactual and not point-identifiable from data in general. Existing bounds either disregard available covariates,…
This paper seeks to clarify whether the processing of two types of messages that promote responsible gambling, namely personalized messages and normative messages, varies across gamblers severity habits and rational thinking
We propose an extensive-form solution concept, with players that neglect information from hypothetical events, but make inferences from observed events. Our concept modifies cursed equilibrium (Eyster and Rabin, 2005), and allows that…
We identify the common underlying form of the capacity expression that is applicable to both cases where causal or non-causal side information is made available to the transmitter. Using this common form we find that for the single user…
We consider the classical problem of discrete distribution estimation using i.i.d. samples in a novel scenario where additional side information is available on the distribution. In large alphabet datasets such as text corpora, such side…
This paper addresses the problem of inferring circulation of information between multiple stochastic processes. We discuss two possible frameworks in which the problem can be studied: directed information theory and Granger causality. The…
Information asymmetry in games enables players with the information advantage to manipulate others' beliefs by strategically revealing information to other players. This work considers a double-sided information asymmetry in a Bayesian…
We consider a specialized form of risk management for betting opportunities with low payout frequency, presented in particular for exotic horse race wagering. An optimization problem is developed which limits losing streaks with high…
We propose information-directed sampling -- a new approach to online optimization problems in which a decision-maker must balance between exploration and exploitation while learning from partial feedback. Each action is sampled in a manner…
Most betting market models employ static frameworks that condition decisions on final odds. Using a unique dataset of interim odds from Japanese horse racing, this study examines the validity of such static analyses by asking whether there…
We investigate the problem of gambling with uncertainty in outcome probabilities. Stochastic optimization models are proposed for optimal investing on events with mutually exclusive outcomes when probabilities are estimated using…
We establish fundamental connections between utility theories of wealth from the economic sciences and information-theoretic quantities. In particular, we introduce operational tasks based on betting where both gambler and bookmaker have…
When users lack specific knowledge of various system parameters, their uncertainty may lead them to make undesirable deviations in their decision making. To alleviate this, an informed system operator may elect to signal information to…
Interaction information is one of the multivariate generalizations of mutual information, which expresses the amount information shared among a set of variables, beyond the information, which is shared in any proper subset of those…
Every interaction of a living organism with its environment involves the placement of a bet. Armed with partial knowledge about a stochastic world, the organism must decide its next step or near-term strategy, an act that implicitly or…
Decision-making under uncertainty and causal thinking are fundamental aspects of intelligent reasoning. Decision-making has been well studied when the available information is considered at the associative (probabilistic) level. The…
We consider the problem of decision-making with side information and unbounded loss functions. Inspired by probably approximately correct learning model, we use a slightly different model that incorporates the notion of side information in…