In this paper we discuss experimental evidence for two different institutional approaches to a possible resolution of the fundamental conflict between social welfare maximization and individual utility maximization. The basic workhorse for modelling this conflict is the voluntary contribution of...

We extend the discrete-choice rational inattention model to the case in which the decision maker can influence the payoff distribution across states. By reducing the gap between payoffs in different states, the decision maker is able to affect her own incentives to pay attention. The smaller the...