This paper presents a general framework for constructing and solving the multivariate static linear quadratic Gaussian (LQG) rational inattention tracking problem. We interpret the nature of the solution and the implied action of the agent, and we construct representations that formalize how the...

Goods and services vary along a number of dimensions independently. Customers can choose to acquire information to assess the quality of some dimensions and not others. Their choices affect firms' incentives to invest in quality and so lead to indirect externalities in consumers' choices. We...

We develop a growth model that features the endogenous two-tier innovations of information carrier technology and production technology. Information carrier technology promotes production technology innovation and thus economic growth through improving the preservation and dissemination of...

We show how information acquisition costs can be identified using observable choice data. Identifying information costs from behavior is especially relevant when these costs depend on factors-such as time, effort, and cognitive resources-that are difficult to observe directly, as in models of...

This paper is concerned with the role of committees in collective decision-makingprocesses in a world where agents must be motivated to collect information. Committees improvethe quality of decision-making by providing information and by coordinating the collection ofinformation. We address two...

A decision-maker (DM) faces an intertemporal decision problem, where his payoff depends on actions taken across time as well as on an unknown Gaussian state. The DM can learn about the state from different (correlated) information sources, and allocates a budget of samples across these sources...

In this paper, I studied an information acquisition problem: a decision maker acquires information about payoff relevant states to facilitate decision making. My primary focus is on flexibility: the decision maker can choose any dynamic signal process as information source, subject to cost on...

This paper studies static rational inattention problems with multiple actions and multiple shocks. We solve for the optimal signals chosen by agents and provide tools to interpret information processing. By relaxing restrictive assumptions previously used to gain tractability, we allow agents...