### Optimal choice of the best available applicant in full-information models

Mitsushi Tamaki
Source: J. Appl. Probab. Volume 46, Number 4 (2009), 1086-1099.

#### Abstract

The problem we consider here is a full-information best-choice problem in which n applicants appear sequentially, but each applicant refuses an offer independently of other applicants with known fixed probability 0≤q<1. The objective is to maximize the probability of choosing the best available applicant. Two models are distinguished according to when the availability can be ascertained; the availability is ascertained just after the arrival of the applicant (Model 1), whereas the availability can be ascertained only when an offer is made (Model 2). For Model 1, we can obtain the explicit expressions for the optimal stopping rule and the optimal probability for a given $n$. A remarkable feature of this model is that, asymptotically (i.e. n→∞), the optimal probability becomes insensitive to $q$ and approaches 0.580 164. The planar Poisson process (PPP) model provides more insight into this phenomenon. For Model 2, the optimal stopping rule depends on the past history in a complicated way and seems to be intractable. We have not solved this model for a finite $n$ but derive, via the PPP approach, a lower bound on the asymptotically optimal probability.

First Page:
Primary Subjects: 60G40
Secondary Subjects: 62L15
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Permanent link to this document: http://projecteuclid.org/euclid.jap/1261670690
Digital Object Identifier: doi:10.1239/jap/1261670690
Zentralblatt MATH identifier: 05665457
Mathematical Reviews number (MathSciNet): MR2582708

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