A utility maximizing model of allocating limited attention between adopting new behaviors and adapting current behaviors generates an optimal policy that resembles commonly observed, and apparently irrational, behavioral rules. The ability to update current behaviors implies an endogenous...

This paper presents a novel explanation of the decision by a firm to make an input within the firm rather than to out-source the production to another firm. Due to the limited attention of the manager/entrepreneur, time spent overseeing production in-house has an opportunity cost: the neglect of...

This paper presents a novel explanation of the decision by a firm to make an input within the firm rather than to out-source the production to another firm. Due to the limited attention of the manager/entrepreneur, time spent overseeing production in-house has an opportunity cost: the neglect of...

A utility maximizing model of allocating limited attention between adopting new behaviors and adapting current behaviors generates an optimal policy that resembles commonly observed, and apparently irrational, behavioral rules. The ability to update current behaviors implies an endogenous...

The optimal innovation, firm size, and growth are derived for a centrally controlled firm in which only the entrepreneur evaluates and restores current projects or evaluates and adopts new projects. Current projects are subject to failure (due to entry) and possible obsolescence, while new...

The Allocation of Limited Entrepreneurial Attention examines the implications of allocating limited entrepreneurial attention among activities or projects. This book maintains that attention is simultaneously limited in that a decision maker can pay attention to only one thing at a time, and...