45,889 research outputs found
Optimal and Myopic Information Acquisition
We consider the problem of optimal dynamic information acquisition from many
correlated information sources. Each period, the decision-maker jointly takes
an action and allocates a fixed number of observations across the available
sources. His payoff depends on the actions taken and on an unknown state. In
the canonical setting of jointly normal information sources, we show that the
optimal dynamic information acquisition rule proceeds myopically after finitely
many periods. If signals are acquired in large blocks each period, then the
optimal rule turns out to be myopic from period 1. These results demonstrate
the possibility of robust and "simple" optimal information acquisition, and
simplify the analysis of dynamic information acquisition in a widely used
informational environment
Efficient Algorithms for Optimal Control of Quantum Dynamics: The "Krotov'' Method unencumbered
Efficient algorithms for the discovery of optimal control designs for
coherent control of quantum processes are of fundamental importance. One
important class of algorithms are sequential update algorithms generally
attributed to Krotov. Although widely and often successfully used, the
associated theory is often involved and leaves many crucial questions
unanswered, from the monotonicity and convergence of the algorithm to
discretization effects, leading to the introduction of ad-hoc penalty terms and
suboptimal update schemes detrimental to the performance of the algorithm. We
present a general framework for sequential update algorithms including specific
prescriptions for efficient update rules with inexpensive dynamic search length
control, taking into account discretization effects and eliminating the need
for ad-hoc penalty terms. The latter, while necessary to regularize the problem
in the limit of infinite time resolution, i.e., the continuum limit, are shown
to be undesirable and unnecessary in the practically relevant case of finite
time resolution. Numerical examples show that the ideas underlying many of
these results extend even beyond what can be rigorously proved.Comment: 19 pages, many figure
Vehicle Choices, Miles Driven, and Pollution Policies
Mobile sources contribute large percentages of each pollutant, but technology is not yet available to measure and tax emissions from each vehicle. We build a behavioral model of household choices about vehicles and miles traveled. The ideal-but-unavailable emissions tax would encourage drivers to abate emissions through many behaviors, some of which involve market transactions that can be observed for feasible market incentives (such as a gas tax, subsidy to new cars, or tax by vehicle type). Our model can calculate behavioral effects of each such price and thus calculate car choices, miles, and emissions. A nested logit structure is used to model discrete choices among different vehicle bundles. We also consider continuous choices of miles driven and the age of each vehicle. We propose a consistent estimation method for both discrete and continuous demands in one step, to capture the interactive effects of simultaneous decisions. Results are compared with those of the traditional sequential estimation procedure.
Search Costs and Medicare Plan Choice
There is increasing evidence suggesting that Medicare beneficiaries do not make fully informed decisions when choosing among alternative Medicare health plans. To the extent that deciphering the intricacies of alternative plans consumes time and money, the Medicare health plan market is one in which search costs may play an important role. To account for this, we split beneficiaries into two groups--those who are informed and those who are uninformed. If uninformed, beneficiaries only use a subset of covariates to compute their maximum utilities, and if informed, they use the full set of variables considered. In a Bayesian framework with Markov Chain Monte Carlo (MCMC) methods, we estimate search cost coefficients based on the minimum and maximum statistics of the search cost distribution, incorporating both horizontal differentiation and information heterogeneities across eligibles. Our results suggest that, conditional on being uninformed, older, higher income beneficiaries with lower self-reported health status are more likely to utilize easier access to information.Search, Medicare Health Plan Choice, Discrete Choice Models, Bayesian Methods
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