"The Not-So-Absent-Minded Driver"

Research in Economics 57, 189-200 (2003)

Abstract: This paper starts with a re-examination of Piccione and Rubinstein’s Absent-Minded Driver problem, and suggests a novel interpretation of Aumann, Hart and Perry’s notion of action-optimality. We then consider several variants of the original problem in which the assumption that the player’s information sets partition the set of his decision nodes is relaxed. This relaxation enables us to construct a counter-example to Piccione and Rubinstein’s result that planning-optimal strategies are always action-optimal. We also show that an agent with more information may do worse than an agent with less.

Keywords: Absentmindedness, Action Optimality

JEL Classification Numbers: C72, D81