“Noon Sunshine-Young Scholars Seminar” is a regular academic exchange platform held by School of Finance. It aims to offer valuable occasions of communications among scholars in our college, between teachers and students, the domestic and the oversea. In this semester, we keep our original intention, set off for a new voyage. We will devote ourselves to fostering the academic atmosphere in the college, and promoting the academic level for both teachers and students.

The first session of “Noon Sunshine-Young Scholars Seminar” for the Autumn Semester in 2024 is arranged as follows:

Lecture topic

An Experiment on Probabilistic Inference from Signal Frequency

Keynote Speaker: Kwon O Sub

Date

Thursday, September 26th, 2024

Time

12:00-13:30

Lecture Venue

Room 116, School of Finance

Abstract

In real life, it is uncommon to know precisely how an information source sends a signal based on the states. Instead, the frequency with which an information source sends signals is more noticeable. For instance, we expect a left-leaning media to predominantly send left-leaning signals rather than right-leaning ones, and vice versa for a right-leaning media. How does a decision-maker make probabilistic inferences in such situations? We explore this question through a series of laboratory experiments. We find that: 1) when the prior probability is known, subjects generally consider frequent signals less informative, which is reasonable, as highly informative signals mathematically cannot be highly frequent. However, 2) when the prior probability is unknown, this comparative static no longer applies, and frequent signals may brainwash subjects into believing that the corresponding states are more likely.