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Theory Workshop: Alessandro Pavan

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Title: Attention, Coordination, and Bounded Recall

I consider a ‡flexible model of coordination under dispersed information where, prior to committing their actions, agents choose the attention to allocate to an arbitrarily large number of information sources. The analysis identifies channels that are responsible for inefficiency in the equilibrium allocation of attention. The results for the case of perfect recall (where the agents remember the effect of each source on posterior beliefs) are compared to the case of bounded recall (where posterior beliefs are consistent with the allocation of attention, but where agents are unable to recognize the in‡uence of individual sources).

This talk is part of the Cambridge-INET Institute, Faculty of Economics series.

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