630. Rational Inattention and Rate Distortion Theory: A Teaching Note

by Tommaso Denti, Massimo Marinacci, Luigi Montrucchio

In this teaching note we discuss the relation between rational inattention and a major branch of information theory called “rate distortion theory.” Focusing on methods, we translate tools from rate distortion theory into the language of rational inattention. These tools provide an alternative, more primitive, approach to the study of optimal attention allocation.    


Last updated October 19, 2018