Economics / Data Analysis

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What is Contest Theory? Contest theory is a tool to describe situation where agents compete with costly efforts to win a scare prize. Quick tips: - agent: economic agent abstraction, examples include workers, sports people etc. - costly efforts: This just means the agent has to make a decision. Ie they do have infinity effort to try to win. Think of the contest people tennis players. A player cannot give 110%, it is physically impossible.

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What is the Discouragement Effect? The discouragement effect is when the future consequences of winning or losing the current contest leads to decreased effort Konrad (2012). This is due the future contest reducing the overall value of winning. Think about a tennis match with 3 sets. If a player loses the first set then to win the entire match they must win 2 sets compared to the other player only needing to win 1 match.

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Introduction

Policy Evaluation (Prediction)

Algorithm

Example

Policy Improvement

Algorithm

Example

Policy Iteration

Algorithm

Example

Value Iteration

Algorithm

Example

Asynchronous Dynamic Programming

Dont sweep the entire state space.

Generalized Policy Iteration

evaluation then improvement then evaluation then improvement then evaluation

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Introduction In Markov Decision Processes you have: * Agent: The decision maker / learner. The agent sends an action to the environment. * Environment: Everything that is not the agent. The environment sends a reward back to the agent. * Reward: The signal that agent tries to maximize. Example GridWorld Lets say we have a 5x5 grid. There are four possible actions: left, right, up, and down. If you reach the point (1,2) and move in any direction you recieve the reward of 10 and are moved to the point (5,2).

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R Markdown This is an R Markdown document. Markdown is a simple formatting syntax for authoring HTML, PDF, and MS Word documents. For more details on using R Markdown see http://rmarkdown.rstudio.com. When you click the Knit button a document will be generated that includes both content as well as the output of any embedded R code chunks within the document. You can embed an R code chunk like this: summary(cars) Including Plots You can also embed plots, for example:

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