We present a novel approach to finite Rational Inattention (RI) models based on the ignorance equivalent, a fictitious action with state-dependent payoffs that effectively summarizes the optimal learning and conditional choices. The ignorance equivalent allows us to recast the RI problem as a...

While the Trump Administration accomplished little of substance, it made progress on one structural objective: casting public doubt on the legitimacy of federal agencies. In particular, the Administration's use of cost-benefit analysis was outcome-oriented and often just bizarre. By deploying...

The simple permanent income model provides a good description of the medium-long run behavior of aggregate nondurables consumption, while it fails in describing its short run behavior. In this paper I present a non-representative agent model with near-rational microeconomic units that...

Standard economic models primarily captured human beings to be rational utility maximizers in the homo oeconomicus model. Behavioral economics addressed human decision making fallibility in a wide range of studies including laboratory and field experiments as well as big data. The currently...

Objective - This study aims to elaborate business resilience of small medium enterprises and to test the impact of rational and irrational antecedents of business resilience during COVID-19 crisis.Methodology/Technique - It is cross-sectional and causal study for testing five hypothesizes....

This study investigates the observed resurgence in religious beliefs seen across many societies during the COVID-19 pandemic. Using the economic theory of religious club, we model religious participation during the pandemic as a mechanism for alleviating the financial distress associated with...

We show analysts’ own earnings forecasts predict error in their own forecasts of earnings at other horizons, which we argue provides a measure of the extent to which analysts inefficiently use information. We construct our measure by exploiting two sources of variation in analysts’...

We review the recent literature on rational inattention, identify the main theoretical mechanisms, and explain how it helps us understand a variety of phenomena across fields of economics. The theory of rational inattention assumes that agents cannot process all available information, but they...

This paper provides a theoretical and empirical examination of the long-run growth in weight over time. We argue that technological change has induced weight growth by making home- and market-production more sedentary and by lowering food prices through agricultural innovation. We analyze how...

Lab experiments have revealed that animals sometimes outperform human-beings in terms of instrumental rationality. The current essay argues that constrained maximization tendency with consistency of preferences are perhaps genetically imbibed behavior of organism, and such examples display a...