Optimal utility and probability functions for agents with finite computational precision

When making economic choices, such as those between goods or gambles, humans act as if their internal representation of the value and probability of a prospect is distorted away from its true value. These distortions give rise to decisions which apparently fail to maximize reward, and preferences that reverse without reason. Why would humans have evolved to encode value and probability in a distorted fashion, in the face of selective pressure for reward-maximizing choices? Here, we show that under the simple assumption that humans make decisions with finite computational precision––in other words, that decisions are irreducibly corrupted by noise––the distortions of value and probability displayed by humans are approximately optimal in that they maximize reward and minimize uncertainty. In two empirical studies, we manipulate factors that change the reward-maximizing form of distortion, and find that in each case, humans adapt optimally to the manipulation. This work suggests an answer to the longstanding question of why humans make “irrational” economic choices

Home Study Course: Spring 2001

Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/72408/1/j.1526-0976.2001.005002105.x.pd

Medical insurance and free choice of physician shape patient overtreatment: a laboratory experiment

"In a laboratory experiment designed to capture key aspects of the interaction between physicians and patients, we study the effects of medical insurance and competition in the guise of free choice of physician, including observability of physicians’ market shares. Medical treatment is an example of a credence good: only the physician knows the appropriate treatment, the patient does not. Even after a consultation, the patient is not sure whether he received the right treatment or whether he was perhaps overtreated. We find that with insurance, moral hazard looms on both sides of the market: patients consult more often and physicians overtreat more often than in the baseline condition. Competition decreases overtreatment compared to the baseline and patients therefore consult more often. When the two institutions are combined, competition is found to partially offset the adverse effects of insurance: most patients seek treatment, but overtreatment is moderated." (author's abstract

Self-reported depression symptoms in haemodialysis patients: Bi-factor structures of two common measures and their association with clinical factors

Copyright © 2018 Elsevier Inc. All rights reserved.Objective: To validate the factor structure of two common self-report depression tools in a large sample of haemodialysis (HD) patients and to examine their demographic and clinical correlates, including urine output, history of depression and transplantation. Methods: Factor structures of the Beck Depression Inventory (BDI-II) and Patient Health Questionnaire (PHQ-9) were evaluated using confirmatory factor analysis (CFA). Data was utilised from the screening phase (n = 709) of a placebo-controlled feasibility randomised control trial (RCT) of sertraline in HD patients with mild to moderate Major Depressive Disorder. Alternative factor models including bi-factor models for the BDI-II and PHQ-9 were evaluated. Coefficient omega and omega-hierarchical were calculated. Results: For both measures, bi-factor measurement models had the overall best fit to the data, with dominant general depression factors. Omega-hierarchical for the general BDI-II and PHQ-9 factors was 0.94 and 0.88 respectively. Both general factors had high reliability (coefficient omega = 0.97 and 0.94 respectively) and explained over 85% of the explained common variance within their respective models. BDI-II and PHQ-9 general depression factors were negatively associated with age and urine output and positively with a history of depression, antidepressant use within the last 3 months and a history of failed transplantation. In adjusted regression models, age, urine output and a history of depression remained significant. Conclusions: These data suggest that both the BDI-II and PHQ-9 are sufficiently unidimensional to warrant the use of a total score. Younger age, lower urine output and a history of depression appear consistent correlates of depression severity among HD patients.Peer reviewedFinal Accepted Versio

Thermal characteristics of a classical solar telescope primary mirror

We present a detailed thermal and structural analysis of a 2m class solar telescope mirror which is subjected to a varying heat load at an observatory site. A 3-dimensional heat transfer model of the mirror takes into account the heating caused by a smooth and gradual increase of the solar flux during the day-time observations and cooling resulting from the exponentially decaying ambient temperature at night. The thermal and structural response of two competing materials for optical telescopes, namely Silicon Carbide -best known for excellent heat conductivity and Zerodur -preferred for its extremely low coefficient of thermal expansion, is investigated in detail. The insight gained from these simulations will provide a valuable input for devising an efficient and stable thermal control system for the primary mirror.Comment: 14 pages, 8 figures, Accepted for publication in New Astronom

A Fredholm Determinant Representation in ASEP

In previous work the authors found integral formulas for probabilities in the asymmetric simple exclusion process (ASEP) on the integer lattice. The dynamics are uniquely determined once the initial state is specified. In this note we restrict our attention to the case of step initial condition with particles at the positive integers, and consider the distribution function for the m'th particle from the left. In the previous work an infinite series of multiple integrals was derived for this distribution. In this note we show that the series can be summed to give a single integral whose integrand involves a Fredholm determinant. We use this determinant representation to derive (non-rigorously, at this writing) a scaling limit.Comment: 12 Pages. Version 3 includes a scaling conjectur

High-Precision Entropy Values for Spanning Trees in Lattices

Shrock and Wu have given numerical values for the exponential growth rate of the number of spanning trees in Euclidean lattices. We give a new technique for numerical evaluation that gives much more precise values, together with rigorous bounds on the accuracy. In particular, the new values resolve one of their questions.Comment: 7 pages. Revision mentions alternative approach. Title changed slightly. 2nd revision corrects first displayed equatio

Construction of the factorized steady state distribution in models of mass transport

For a class of one-dimensional mass transport models we present a simple and direct test on the chipping functions, which define the probabilities for mass to be transferred to neighbouring sites, to determine whether the stationary distribution is factorized. In cases where the answer is affirmative, we provide an explicit method for constructing the single-site weight function. As an illustration of the power of this approach, previously known results on the Zero-range process and Asymmetric random average process are recovered in a few lines. We also construct new models, namely a generalized Zero-range process and a binomial chipping model, which have factorized steady states.Comment: 6 pages, no figure