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Role of Information in Decision Making of Social Agents

Author

Listed:
  • Vyacheslav I. Yukalov

    (Department of Management, Technology and Economics, ETH Zürich, Swiss Federal Institute of Technology, Zürich CH-8092, Switzerland;
    Bogolubov Laboratory of Theoretical Physics, Joint Institute for Nuclear Research, Dubna 141980, Russia)

  • Didier Sornette

    (Department of Management, Technology and Economics, ETH Zürich, Swiss Federal Institute of Technology, Zürich CH-8092, Switzerland;
    Swiss Finance Institute, c/o University of Geneva, 40 Blvd. Du Pont d'Arve, CH 1211 Geneva 4, Switzerland)

Abstract

The influence of additional information on the decision making of agents, who are the interacting members of a society, is analyzed within the mathematical framework based on the use of quantum probabilities. The introduction of social interactions, which influence the decisions of individual agents, leads to a generalization of the quantum decision theory (QDT) developed earlier by the authors for separate individuals. The generalized approach is free of the standard paradoxes of classical decision theory. This approach also explains the error-attenuation effects observed for the paradoxes occurring when decision makers, who are members of a society, consult with each other, increasing in this way the available mutual information. A precise correspondence between QDT and classical utility theory is formulated via the introduction of an intermediate probabilistic version of utility theory of a novel form, which obeys the requirement that zero-utility prospects should have zero probability weights.

Suggested Citation

  • Vyacheslav I. Yukalov & Didier Sornette, 2015. "Role of Information in Decision Making of Social Agents," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 14(05), pages 1129-1166.
    • Handle: RePEc:wsi:ijitdm:v:14:y:2015:i:05:n:s0219622014500564
    DOI: 10.1142/S0219622014500564
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    Citations

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    Cited by:

    1. Zabaleta, O.G. & Barrangú, J.P. & Arizmendi, C.M., 2017. "Quantum game application to spectrum scarcity problems," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 466(C), pages 455-461.
    2. Ferro, Giuseppe M. & Kovalenko, Tatyana & Sornette, Didier, 2021. "Quantum decision theory augments rank-dependent expected utility and Cumulative Prospect Theory," Journal of Economic Psychology, Elsevier, vol. 86(C).
    3. Eichberger, Jürgen & Pirner, Hans Jürgen, 2018. "Decision theory with a state of mind represented by an element of a Hilbert space: The Ellsberg paradox," Journal of Mathematical Economics, Elsevier, vol. 78(C), pages 131-141.
    4. Maroussia Favre & Amrei Wittwer & Hans Rudolf Heinimann & Vyacheslav I Yukalov & Didier Sornette, 2016. "Quantum Decision Theory in Simple Risky Choices," PLOS ONE, Public Library of Science, vol. 11(12), pages 1-29, December.

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