The Analytics of Uncertainty and Information (Cambridge Surveys of Economic Literature)

Rating:
Summary: Difficult but worthwhile read
Review: Firstly, this book is not a book for a novice to economics, and as an economics graduate, I found this a challenging book to read. If you are a mathematics major, you might also want to consider this book. That being said, the theories expressed in this book are truely phenomenal. Anyone with an interest or background in transactions cost economic theory will be both at an advantage, and will have a deep appreciation for the contents of this book.

This book comes in two halves. The first deals with situations where an individual has limited information, and derives some generalised theories about how individuals choose actions to obtain a probability density function of alternatives (since outcomes are not fully known). The second half of this book deals with situations where an agent can partake in information gathering activities to reduce the risk involved in the action-consequence connection.

This is a tough book, not for the faint of heart. But it is an incredibly worthwhile book. And as I said earlier, a background in economics (or *possibly* mathematics) is essential. Easily worth the money paid.