Andrei Matveenko wins Young Economist of the Year Award
The Czech Economic Society has awarded the title Young Economist of the Year 2019 to Andrei Matveenko and his co-author Vladimír Novák for their paper „The Status Quo and Belief Polarization of Inattentive Agents.“
This winning paper is on rational inattention under uncertainty when new policies are introduced. Many real-world situations involve a choice between the implementation of a new policy with multiple possible outcomes and the preservation of the status quo.
Andrei Matveenko and Vladimír Novák analyse what information an inattentive agent acquires in such a binary choice problem. They model the agent to be rationally inattentive: any information about the new policy can be acquired before the choice is made, but doing so is costly. They show how the choice of information, and thus the belief formation, depends on the status quo and they present under which conditions the beliefs can update away from the realized truth in expectation.
This result depends on the endogenous information acquisition process, as the agent only needs to learn whether the uncertain payoff is higher or lower than the payoff of the status quo. Consequently, even two agents with the same prior beliefs about the new policy might become polarized if they differ in the valuations of the status quo.
The Czech Economic Society (CES) is awarding the Young Economist of the Year Award to members of the Czech economics community who are no more than 30 years old. The award is supported by the Council of Scientific Societies of the Czech Republic.
The prize was presented by Kamil Galuščák, CES President, during the General Assembly of the Czech Economic Society on 28th November 2019 in Prague at the Institute of Economic Studies, Charles University.