Munich Personal RePEc Archive

A check for rational inattention

Howard, Greg (2021): A check for rational inattention.

[img]
Preview
PDF
MPRA_paper_108243.pdf

Download (1MB) | Preview

Abstract

Models of rational inattention allow agents to make mistakes in their actions while assuming they do not make mistakes in attention allocation. I test this assumption by comparing attention’s marginal benefit (better actions) and marginal cost (less time for future decisions) using millions of online chess moves. I cannot reject that skilled players equalize marginal benefit and marginal cost across different time controls. Bad players, when they have little time, under-adjust their attention allocation, leading them to have higher marginal cost. A simple intervention improves players' attention allocation.

Logo of the University Library LMU Munich
MPRA is a RePEc service hosted by
the University Library LMU Munich in Germany.