Optimal strategies for seeking information: Models for statistics, choice reaction times, and human information processing

Abstract

Models for optional stopping in statistics are also normative models for tasks in which subjects may purchase risk-reducing information before making a decision. A Bayesian model for optional stopping for the two-hypothesis continuous case is developed; it takes explicit account of cost of information, values of the possible outcomes of the final decision, and prior probabilities of the hypotheses.A nonparametric model for choice reaction times is derived. It makes strong predictions about times and errors; only one quantity in it is not directly observable.A second example uses the model to design and predict results of a binomial information-purchase experiment.