Switching cost models as hypothesis tests

Cohen, SN; Henckel, T; Menzies, GD; Muhle-Karbe, J; Zizzo, DJ

Switching cost models as hypothesis tests

Cohen, SN Henckel, T Menzies, GD

Muhle-Karbe, J Zizzo, DJ

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Publication Type:: Journal Article
Citation:: Economics Letters, 2019, 175 pp. 32 - 35
Issue Date:: 2019-02-01

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Field	Value	Language
dc.contributor.author	Cohen, SN	en_US
dc.contributor.author	Henckel, T	en_US
dc.contributor.author	Menzies, GD https://orcid.org/0000-0003-4133-2282	en_US
dc.contributor.author	Muhle-Karbe, J	en_US
dc.contributor.author	Zizzo, DJ	en_US
dc.date.available	2021-02-01T18:06:50Z
dc.date.issued	2019-02-01	en_US
dc.identifier.citation	Economics Letters, 2019, 175 pp. 32 - 35	en_US
dc.identifier.issn	0165-1765	en_US
dc.identifier.uri	http://hdl.handle.net/10453/129655
dc.description.abstract	© 2018 Elsevier B.V. We relate models based on costs of switching beliefs (e.g., due to inattention) to hypothesis tests. Specifically, for an inference problem with a penalty for mistakes and for switching the inferred value, a band of inaction is optimal. We show this band is equivalent to a confidence interval, and therefore to a two-sided hypothesis test.	en_US
dc.relation.ispartof	Economics Letters	en_US
dc.relation.isbasedon	10.1016/j.econlet.2018.11.014	en_US
dc.rights	info:eu-repo/semantics/openAccess
dc.subject.classification	Economics	en_US
dc.title	Switching cost models as hypothesis tests	en_US
dc.type	Journal Article
utslib.citation.volume	175	en_US
utslib.for	1401 Economic Theory	en_US
utslib.for	14 Economics	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Business
pubs.organisational-group	/University of Technology Sydney/Faculty of Business/Economics Discipline
utslib.copyright.status	open_access	*
pubs.publication-status	Published	en_US
pubs.volume	175	en_US

Abstract:

© 2018 Elsevier B.V. We relate models based on costs of switching beliefs (e.g., due to inattention) to hypothesis tests. Specifically, for an inference problem with a penalty for mistakes and for switching the inferred value, a band of inaction is optimal. We show this band is equivalent to a confidence interval, and therefore to a two-sided hypothesis test.

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http://hdl.handle.net/10453/129655