Related papers: Information inefficiency in a random linear econom…
Opportunities, such as access to education or family background, shape income inequality by influencing the chances of economic success. Unequal opportunities create uncertainty about whether success is merit- or luck-based. We examine how…
Various papers demonstrate the importance of inequality, poverty and the size of the middle class for economic growth. When explaining why these measures of the income distribution are added to the growth regression, it is often mentioned…
Observation of other people's choices can provide useful information in many circumstances. However, individuals may not utilize this information efficiently, i.e., they may make decision-making errors in social interactions. In this paper,…
Recommendation systems are ubiquitous and impact many domains; they have the potential to influence product consumption, individuals' perceptions of the world, and life-altering decisions. These systems are often evaluated or trained with…
Understanding consumption dynamics and its impact on the whole economy and welfare within the present economic crisis is not an easy task. Indeed the level of consumer demand for different goods varies with the prices, consumer incomes and…
I develop a rather simple agent-based model to capture a co-evolution of opinion formation, political decision making and economic outcomes. I use this model to study how societies form opinions if their members have opposing interests.…
We discuss several aspects of creation of adequate mathematical models in other sciences. In particular, many difficulties stem from great complexity of the source systems and the presence of a variety of uncertain factors. We illustrate…
We study consumption behaviour in systems with heterogeneous interacting agents. Two different models are introduced, respectively with long and short range interactions among agents. At any time step an agent decides whether or not to…
The recent developments of social networks and recommender systems have dramatically increased the amount of social information shared in human communities, challenging the human ability to process it. As a result, sharing aggregated forms…
This paper establishes a general equivalence between discrete choice and rational inattention models. Matejka and McKay (2015, AER) showed that when information costs are modelled using the Shannon entropy function, the resulting choice…
Decision makers who receive many signals are subject to imperfect recall. This is especially important when learning from feeds that aggregate messages from many senders on social media platforms. In this paper, we study a stylized model of…
Integrating information gained by observing others via Social Bayesian Learning can be beneficial for an agent's performance, but can also enable population wide information cascades that perpetuate false beliefs through the agent…
We are interested in the effect of consumer demand estimation error for new products in the context of production planning. An inventory model is proposed, whereby demand is influenced by price and advertising. The effect of parameter…
Traditional evaluation of information access systems has focused primarily on average utility across a set of information needs (information retrieval) or users (recommender systems). In this work, we argue that evaluating only with average…
In this paper, our aim is to propose a model that helps in the efficient use of an information system by users, within the organization represented by the IS, in order to resolve their decisional problems. In other words we want to aid the…
While popularity bias is recognized to play a crucial role in recommmender (and other ranking-based) systems, detailed analysis of its impact on collective user welfare has largely been lacking. We propose and theoretically analyze a…
The minority model was introduced to study the competition between agents with limited information. It has the remarkable feature that, as the amount of information available increases, the collective gain made by the agents is reduced.…
Algorithmic predictions are increasingly informing societal resource allocations by identifying individuals for targeting. Policymakers often build these systems with the assumption that by gathering more observations on individuals, they…
The technological revolution of the Internet has digitized the social, economic, political, and cultural activities of billions of humans. While researchers have been paying due attention to concerns of misinformation and bias, these…
Nowadays, attitudes towards electricity customers have been changed, so that they are no longer considered static players. The customers behavior identification is vital for establishing modern power systems. This paper utilizes the…