The cost of information

We develop an axiomatic theory of information acquisition that captures the idea of constant marginal costs in information production: the cost of generating two independent signals is the sum of their costs, and generating a signal with probability half costs half its original cost. Together with a monotonicity and a continuity conditions, these axioms determine the cost of a signal up to a vector of parameters. These parameters have a clear economic interpretation and determine the difficulty of distinguishing states. We argue that this cost function is a versatile modeling tool that leads to more realistic predictions than mutual information.Comment: 52 pages, 4 figure

Axiomatic foundations of quantum mechanics revisited: the case for systems

We present an axiomatization of non-relativistic Quantum Mechanics for a system with an arbitrary number of components. The interpretation of our system of axioms is realistic and objective. The EPR paradox and its relation with realism is discussed in this framework. It is shown that there is no contradiction between realism and recent experimental results.Comment: submitted to International Journal of Theoretical Physics, uses Latex, no figure

A subjective spin on roulette wheels.

We provide a behavioral foundation to the notion of ‘mixture’ of acts, which is used to great advantage in he decision setting introduced by Anscombe and Aumann. Our construction allows one to formulate mixture-space axioms even in a fully sub-jective setting, without assuming the existence of randomizing devices. This simplifies the task of developing axiomatic models which only use behavioral data. Moreover, it is immune from the difficulty that agents may ‘distort’ the probabilities associated with randomizing devices. For illustration, we present simple subjective axiomatizations of some models of choice under uncertainty, including the maxmin expected utility model of Gilboa and Schmeidler, and Bewley’s model of choice with incomplete preferences.

Axiomatic Bargaining Theory on Opportunity Assignments

This paper discusses issues of axiomatic bargaining problems over opportunity assignments. The fair arbitrator uses the principle of "equal opportunity" for all players to make the recommendation on re- source allocations. A framework in such a context is developed and several classical solutions to standard bargaining problems are reformulated and axiomatically characterized. Working Paper 06-4

Bargaining and the theory of cooperative games: John Nash and beyond

This essay surveys the literature on the axiomatic model of bargaining formulated by Nash ("The Bargaining Problem," Econometrica 28, 1950, 155-162).Nash's bargaining model, Nash solution, Kalai-Smorodinsky solution, Egalitarian solution

CCS Dynamic Bisimulation is Progressing

Weak Observational Congruence (woc) defined on CCS agents is not a bisimulation since it does not require two states reached by bisimilar computations of woc agents to be still woc, e.g.\ $\alpha.\tau.\beta.nil$ and $\alpha.\beta.nil$ are woc but $\tau.\beta.nil$ and $\beta.nil$ are not. This fact prevents us from characterizing CCS semantics (when $\tau$ is considered invisible) as a final algebra, since the semantic function would induce an equivalence over the agents that is both a congruence and a bisimulation. In the paper we introduce a new behavioural equivalence for CCS agents, which is the coarsest among those bisimulations which are also congruences. We call it Dynamic Observational Congruence because it expresses a natural notion of equivalence for concurrent systems required to simulate each other in the presence of dynamic, i.e.\ run time, (re)configurations. We provide an algebraic characterization of Dynamic Congruence in terms of a universal property of finality. Furthermore we introduce Progressing Bisimulation, which forces processes to simulate each other performing explicit steps. We provide an algebraic characterization of it in terms of finality, two characterizations via modal logic in the style of HML, and a complete axiomatization for finite agents. Finally, we prove that Dynamic Congruence and Progressing Bisimulation coincide for CCS agents. Thus the title of the paper

(WP 2016-03) Economics, Neuroeconomics, and the Problem of Identity

This paper reviews the debate in economics over neuroeconomics’ contribution to economics. It distinguishes majority and minority views, argues that this debate has been framed by mainstream economics’ conception of itself as an isolated science, and argues that this framing has put off the agenda in economics issues such as individual identity that are increasingly important in connection with the social and historical context of economic explanations in a changing complex world. The paper first discusses how the debate over neuroeconomics has been limited to the question of what information from other sciences might be employed in economics. It then goes on to the individual identity issue, and discusses how economics’ top-down, closed character generates a circular individual identity conception, while bottom-up, open character of psychology and neuroscience, and their continual concern with the changing relation between theory and evidence, has produced four competing individual identity conceptions in neuroeconomic research