DAVID
WALKER-JONES
Welcome! I am a lecturer with the School of Economics at the University of Surrey and I specialize in micro theory and experimental economics.
Published Papers
This paper studies a new measure for the cost of learning that allows the different attributes of the options faced by an agent to differ in their associated learning costs. The new measure maintains the tractability of Shannon’s classic measure but produces richer choice predictions and identifies a new form of informational bias significant for welfare and counterfactual analysis that is conducted with the multinomial logit model. Necessary and sufficient conditions are provided for optimal agent behavior under the new measure for the cost of learning.
By weakening Shannon’s original axioms to allow for attributes of the choice environment to differ in their associated learning costs, this paper provides an axiomatic foundation for Multi-Attribute Shannon Entropy, a natural multi-parameter generalization of Shannon Entropy. Sufficient conditions are also provided for a simple dataset that identifies the Multi-Attribute Shannon Entropy cost function for information by analysing stochastic choice data produced by a rationally inattentive agent that is picking between pairs of options when relatively few states of the world have a positive probability of being realized.
Working Papers
Welfare and counterfactual analysis with demand represent some of the most foundational tools in economics, and yet an understanding of what demand looks like in a revealed preference environment with standard models of costly learning is lacking. I provide necessary and sufficient conditions for demand being rationalized by several standard costly learning models and show that heterogeneous costs for learning can produce demand patterns that cannot be rationalized by representative agent versions of the same model. A data enrichment shows that many experiment subjects violate even the most flexible model of costly learning if costs are assumed to be constant.
(with Yoram Halevy and Lanny Zrill)
We introduce an incentive-compatible mechanism that set-identifies behavior consistent with broad classes of complete preferences under uncertainty. Choices outside this set reveal an inability to rank alternatives, indicating incomplete preferences. Experimental findings show that choices incompatible with Subjective Expected Utility often cannot be rationalized by flexible models of complete preferences. These results reflect three sources of deliberate randomization – indifference, hedging (convexity), and incomplete preferences.
(with Umberto Garfagnini)
This paper presents a novel experiment investigating how individuals update beliefs when faced with repeated or redundant information, uninformative signals common in realworld communication but rarely studied in economics. While Bayes’ rule prescribes that such information should be ignored, we find it significantly influences behavior. These deviations from Bayesianism are not due to computational complexity: calculating posteriors is generally as simple as averaging two integers. Instead, our results suggest that many subjects rely on heuristics consistent with naive frequentism, interpreting repeated or redundant information as indicative of frequency, which helps explain its persuasive power and prevalence in real-world settings.
Work in Progress
Mechanism Design with Endogenous Information Dissemination
(with Henrique Castro-Pires and Krittanai Laohakunakorn)
We investigate the tradeoffs associated with giving additional commitment power to a biased principal.
Ambiguous Political Platforms and Behavioural Voters
This paper explores a behavioral model of how voters pick a favorite political candidate, and the implications of the model for equilibria in a two candidate election that sees candidates choosing their public platform by selecting the dimensions of their planned policy they wish to disclose. Even if the behavioral voters are ambiguity averse, not declaring a position in certain dimensions can benefit a candidate by focusing the attention of their target voters on dimensions in which the target voters have more homogenous preferences.
Competing Firms and Obfuscation
This paper explores a Bertrand style duopoly environment in which a priori identical firms can choose both the price for their product and how costly it is for prospective buys to observe their realized heterogenous value for the firm's product. In such a setting, competition is not sufficient for achieving prices that are lower than the monopoly price.
​Identifying Preferences Using Reaction Times
A theory paper that holds learning costs, as identified by reaction times, constant by using the non-monotonic relationship between the price of a good with uncertain value and the incentive to learn. Holding learning costs constant allows for the identification of preferences.
​
​
Contact
