Revealed Preference, Rational Inattention, and Costly Information Acquisition

S-Tier
Journal: American Economic Review
Year: 2015
Volume: 105
Issue: 7
Pages: 2183-2203

Authors (2)

Andrew Caplin (not in RePEc) Mark Dean (Brown University)

Score contribution per author:

4.036 = (α=2.02 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Apparently mistaken decisions are ubiquitous. To what extent does this reflect irrationality, as opposed to a rational trade-off between the costs of information acquisition and the expected benefits of learning? We develop a revealed preference test that characterizes all patterns of choice "mistakes" consistent with a general model of optimal costly information acquisition and identify the extent to which information costs can be recovered from choice data. (JEL D11, D81, D83)

Technical Details

RePEc Handle
repec:aea:aecrev:v:105:y:2015:i:7:p:2183-2203
Journal Field
General
Author Count
2
Added to Database
2026-01-25