Related papers: Correlation Concern
Correlated equilibria arise naturally when agents communicate or rely on intermediaries such as recommendation systems. We study when a given Nash equilibrium can be improved within the set of correlated equilibria for general objectives.…
A multitude of classifiers can be trained on the same data to achieve similar performances during test time, while having learned significantly different classification patterns. This phenomenon, which we call prediction discrepancies, is…
Machine learning models are often used to inform real world risk assessment tasks: predicting consumer default risk, predicting whether a person suffers from a serious illness, or predicting a person's risk to appear in court. Given…
Discovering a correlation from one variable to another variable is of fundamental scientific and practical interest. While existing correlation measures are suitable for discovering average correlation, they fail to discover hidden or…
Outside ideal settings, conventions are shaped by competing processes that can challenge the emergence of norms. This paper identifies three trade-offs challenging the diffusion of conventions: (I) the trade-off between the imperatives of…
Machine learning (ML) is increasingly used in high-stakes settings, yet multiplicity - the existence of multiple good models - means that some predictions are essentially arbitrary. ML researchers and philosophers posit that multiplicity…
I study how past and future choices are linked in the framework of attention. Attention cannot be observed but past choices are necessarily considered in future decisions. This link connects two types of rationality violations,…
A procedure for the evaluation of correlators of any order in a reasonable computer time is presented. Connection between correlators and fluctuations of the event mean values of observables is discussed. Extension of the procedure to…
The problem of assessing the value of a candidate is viewed here as a multiple combination problem. On the one hand a candidate can be evaluated according to different criteria, and on the other hand several experts are supposed to assess…
Decision-making individuals are often considered to be either imitators who copy the action of their most successful neighbors or best-responders who maximize their benefit against the current actions of their neighbors. In the context of…
Estimating causal interactions in complex dynamical systems is an important problem encountered in many fields of current science. While a theoretical solution for detecting the causal interactions has been previously formulated in the…
People often deviate from expected utility theory when making risky and intertemporal choices. While the effects of probabilistic risk and time delay have been extensively studied in isolation, their interplay and underlying theoretical…
In general, underestimation of risk is something which should be avoided as far as possible. Especially in financial asset management, equity risk is typically characterized by the measure of portfolio variance, or indirectly by quantities…
When a collective decision maker presents a menu of uncertain prospects to her group members, each member's choice depends on their predictions about payoff-relevant states. In reality, however, these members hold different predictions;…
An individual can only experience regret if she learns about an unchosen alternative. In many situations, learning about an unchosen alternative is possible only if someone else chose it. We develop a model where the ex-post information…
Understanding cooperation in social systems is challenging because the ever-changing rules that govern societies interact with individual actions, resulting in intricate collective outcomes. In virtual-world experiments, we allowed people…
Decisions by humans depend on their estimations given some uncertain sensory data. These decisions can also be influenced by the behavior of others. Here we present a mathematical model to quantify this influence, inviting a further study…
Decision-making pipelines are generally characterized by tradeoffs among various risk functions. It is often desirable to manage such tradeoffs in a data-adaptive manner. As we demonstrate, if this is done naively, state-of-the art…
A seller posts a price for a single object. The seller's and buyer's values may be interdependent. We characterize the set of payoff vectors across all information structures. Simple feasibility and individual-rationality constraints…
Option written on several foreign exchange rates (FXRs) depends on correlation between the rates. To evaluate the option, historical estimates for correlations can be used but usually they are not stable. More significantly, pricing of the…