Diversion Inattention: Time for Action!

Travel time variability and rational inattention

This paper sets up a rational inattention model for the choice of departure time for a traveler facing random travel time. The traveler chooses how much information to acquire about the travel time outcome before choosing departure time. This reduces the cost of travel time variability compared to models in which the information is exogenously fixed .

Competing for Consumer Inattention∗

Consumers purchase multiple types of goods, but may be able to examine only a limited number of markets for the best price. We propose a simple model which captures these features, conveying new insights. A firm’s price can deflect or draw attention to its market, and consequently, limited attention introduces a new dimension of cross-market competition. We characterize the equilibrium, and sho...

Diversion Issues in Real-Time Vehicle Dispatching

Recent technological advances in communication systems now allow the exploitation of realtime information for dynamic vehicle routing and scheduling. It is possible, in particular, to consider diverting a vehicle away from its current destination in response to a new customer request. In this paper, a strategy for assigning customer requests, which includes diversion, is proposed, and various i...

Foundations for optimal inattention

This paper models an agent who has a limited capacity to pay attention to information and thus conditions her actions on a coarsening of the available information. An optimally inattentive agent chooses both her coarsening and her actions by constrained maximization of an underlying subjective expected utility preference relation. The main result axiomatically characterizes the conditional choi...

[Time for action].