On the economics of superabundant information and scarce attention

Abstract

This article provides an introduction to the literature addressing the causes and consequences of limited attention in economics. We present a simple set-theoretic micro-structure describing the allocation of attention, and use this framework to explain the central notions of goal-and stimulus-driven attention mechanisms. After presenting empirical evidence on limited attention from psychology, marketing and internet research, we use our baseline setting to discuss a number of recent contributions featuring some form of limited attention or related phenomena, such as obfuscation.

Keywords

• limited attention
• information overload
• attention allocation
• salience
• perception
• informative advertising