Back to 2025 Programme

Getting the Picture

Sydney, Australia 24 August 2025 – 26 August 2025

Robert Akerlof (UNSW); Richard Holden (UNSW); Hongyi Li (UNSW)

B7 Knowledge and Communication
Chair: Robert Akerlof
Room UNSW Business School 119
Economics / Other

Abstract

People may have all the information needed to draw a conclusion yet—in contrast to standard economic models—they fail to connect the dots. For example, when staring at a picture, someone might be able to identify the color of each “pixel” and yet fail to see what the picture represents (e.g. “it’s a smiley face”). We formalize this idea. An agent’s task is to learn about a picture’s features. Initially, they know the color of each pixel, but not features of larger regions of the picture—thus, they cannot discern what the picture depicts. They add to knowledge by loading existing knowledge into working memory and deducing new features. Importantly, the agent has limited working memory, which bounds their ability to draw conclusions. The model captures many important phenomena, such as multi-stable perception, choice overload, and satisficing. It provides a useful conceptualization of narratives as “big-picture statements.” We discuss several potential applications, including to the politics of persuasion.

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