Related papers: Increasing Value of Information Implies Separable …
We introduce a new updating rule, the conditional maximum likelihood rule (CML) for updating ambiguous information. The CML formula replaces the likelihood term in Bayes' rule with the maximal likelihood of the given signal conditional on…
Human cooperation depends on how accurately we infer others' motives--how much they value fairness, generosity, or self-interest from the choices they make. We model that process in binary dictator games, which isolate moral trade-offs…
Notwithstanding various attempts to construct a Partial Information Decomposition (PID) for multiple variables by defining synergistic, redundant, and unique information, there is no consensus on how one ought to precisely define either of…
This paper introduces a space of variable lotteries and proves a constructive version of the expected utility theorem. The word ``constructive'' is used here in two senses. First, as in constructive mathematics, the logic underlying proofs…
Diversification represents the idea of choosing variety over uniformity. Within the theory of choice, desirability of diversification is axiomatized as preference for a convex combination of choices that are equivalently ranked. This…
The Random Utility Model (RUM) is the leading model to represent the aggregate choices of a heterogeneous population of preference maximizers. We show that if (and only if) preferences are sufficiently uncorrelated, RUM choices can also be…
A competitive market is modeled as a game of incomplete information. One player observes some payoff-relevant state and can sell (possibly noisy) messages thereof to the other, whose willingness to pay is contingent on their own beliefs. We…
We study a continuous-time expected utility maximization problem in which the investor at maturity receives the value of a contingent claim in addition to the investment payoff from the financial market. The investor knows nothing about the…
Two types of privacy-preserving decision making paradigms for utility-community interactions for multi-horizon operation are examined in this paper. In both designs, communities with renewable energy sources, distributed generators, and…
This paper considers a problem where multiple users make repeated decisions based on their own observed events. The events and decisions at each time step determine the values of a utility function and a collection of penalty functions. The…
We present a new approach to classification that combines data and knowledge. In this approach, data mining is used to derive association rules (possibly with negations) from data. Those rules are leveraged to increase the predictive…
In this paper we design information elicitation mechanisms for Bayesian auctions. While in Bayesian mechanism design the distributions of the players' private types are often assumed to be common knowledge, information elicitation considers…
The extraction of a physical law y=yo(x) from joint experimental data about x and y is treated. The joint, the marginal and the conditional probability density functions (PDF) are expressed by given data over an estimator whose kernel is…
This paper axiomatizes, in a two-stage setup, a new theory for decision under risk and ambiguity. The axiomatized preference relation $\succeq$ on the space $\tilde{V}$ of random variables induces an ambiguity index $c$ on the space…
Dempster's rule is a fundamental tool for combining belief functions from distinct and reliable sources. However, its intersection-based semantics imposes strong structural restrictions, which limits its flexibility in handling complex…
This paper proposes a systematic framework to design a classification model that yields a classifier which optimizes a utility function based on prior knowledge. Specifically, as the data size grows, we prove that the produced classifier…
This paper presents an information-theoretic approach to address the phasor measurement unit (PMU) placement problem in electric power systems. Different from the conventional 'topological observability' based approaches, this paper…
The sum-utility maximization problem is known to be important in the energy systems literature. The conventional assumption to address this problem is that the utility is concave. But for some key applications, such an assumption is not…
The Bayesian decision-theoretic approach to design of experiments involves specifying a design (values of all controllable variables) to maximise the expected utility function (expectation with respect to the distribution of responses and…
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…